California Assembly Bill 5, Ride-sharing, and Other Workers

Since the beginning, ride-sharing has been a complicated issue. At first there were  issues with drivers using their personal autos for business use; many drivers did not understand that what they were doing was excluded under their personal auto policy. It took some time for the industry to adapt and make it clear when coverage fell under the personal auto, when there was no coverage under the personal auto, and when coverage fell to the Transportation Network Company (TNC). Carriers began developing endorsements and coverage specifically for ride-sharing, especially as some states passed legislation requiring coverage to be provided during any gap periods.

Then, it became a matter of whether or not the drivers were employees of the TNC, or whether they were independent contractors. The drivers wanted to be considered employees in order to receive increased pay and benefits, while the TNCs maintained that the drivers were not their employees, the drivers were simply using the service provided by the TNC to match them with potential passengers. This is an ongoing issue; yesterday the California senate passed a bill that provides companies strict guidelines on how to determine if a person is an employee or an independent worker.