California Enacts AB 1340: Pathway for Uber and Lyft Driver Unions

California, October 4, 2025

News Summary

California Governor Gavin Newsom signed AB 1340 into law, allowing Uber and Lyft drivers to form unions and negotiate contracts starting January 1. Authored by Assemblymembers Buffy Wicks and Marc Berman, the legislation provides essential rights for drivers to discuss pay, working conditions, and benefits, despite their independent contractor status established by Proposition 22. Though the law presents opportunities for drivers, challenges remain in achieving better compensation and job security.

California Governor Gavin Newsom has signed a landmark piece of legislation that creates a pathway for Uber and Lyft drivers in the state to negotiate their first union contract, despite being classified as independent contractors. The new law, known as AB 1340, will take effect on January 1, marking a significant advancement in the ongoing efforts of drivers to secure workplace rights.

Authored by Assemblymembers Buffy Wicks (D-Oakland) and Marc Berman (D-Menlo Park), AB 1340 allows unions for drivers, once certified by a state board, to negotiate on their behalf regarding essential issues like pay, working conditions, and benefits. The law also provides protections against retaliation for those participating in union activities. This measure is part of a broader attempt to improve the working conditions of ride-hailing drivers, who for years have sought the rights typically granted to employees.

The legislation follows California’s 2020 ballot measure, Proposition 22, which classified app-based drivers as independent contractors, thus removing many of their workplace rights. Under federal law, independent contractors generally do not have the right to collectively bargain, whereas employees enjoy protections, including minimum wage and overtime pay.

AB 1340 mandates that app-based companies and certified unions must negotiate in good faith on driver-related issues. This includes pay rates, deactivation policies, and provisions for paid leave. Additionally, the Public Employment Relations Board will oversee union elections and enforce compliance with any agreements reached during bargaining.

Initially, Uber and Lyft opposed the legislation but later shifted their position after negotiating reduced insurance coverage requirements through a separate bill, SB 371. However, critics of AB 1340 have raised concerns that, while the new law empowers drivers to organize, significant obstacles remain in securing better pay and benefits from these tech giants. A key component of union formation involves gathering signatures from at least 10% of California’s approximately 800,000 ride-hailing drivers, as well as achieving a 30% approval rate to formally recognize a union.

Driver activists have noted that the legislation does not guarantee the right to strike, a crucial element of leverage and bargaining power for unions. The law was enacted following a California Court of Appeals ruling that clarified that lawmakers could authorize collective bargaining rights for drivers, despite the limitations imposed by Proposition 22.

Experts have expressed skepticism regarding the long-term benefits of AB 1340, suggesting that Uber and Lyft maintain substantial control over drivers’ earnings and working conditions. Labor leaders also face substantial administrative hurdles before formal negotiations can commence, with some estimates indicating discussions may not begin until 2026.

In addition to AB 1340, a comprehensive wage theft lawsuit is currently being pursued against Uber and Lyft, with drivers hoping the legal action will recover back wages and enhance future pay terms. The overarching goals of AB 1340 and its accompanying legislation are to find a balance between reducing rideshare costs for consumers while simultaneously empowering drivers within the gig economy.

This makes California the second state in the United States, following Massachusetts, to establish such pathways for app-based drivers to unionize.

Key Features of AB 1340

• Effective Date: January 1
• Author: Assemblymembers Buffy Wicks and Marc Berman
• Independent Contractor Status: Maintained under Proposition 22
• Union Certification: By a state board
• Negotiation Topics: Pay, working conditions, benefits
• Driver Participation: Minimum of 10% for union formation; 30% approval for recognition
• Oversight: Public Employment Relations Board

Deeper Dive: News & Info About This Topic

• Politico
• LAist
• The Guardian
• New York Times
• Los Angeles Times
• Wikipedia: Union
• Google Search: union rights
• Google Scholar: unionization laws
• Encyclopedia Britannica: collective bargaining
• Google News: uber lyft drivers unionize

Author: STAFF HERE COSTA MESA WRITER

COSTA MESA STAFF WRITER The COSTA MESA STAFF WRITER represents the experienced team at HERECostaMesa.com, your go-to source for actionable local news and information in Costa Mesa, Orange County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the OC Fair, Concerts in the Park, and Fish Fry. Our coverage extends to key organizations like the Costa Mesa Chamber of Commerce and Boys & Girls Clubs of Central Orange Coast, plus leading businesses in retail, fashion, and technology that power the local economy such as Vans, Experian, and South Coast Plaza. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HEREMissionViejo.com, HERESanDiego.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.