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Uber updates app in California as state enacts gig work bill

Uber Technologies Inc. said Jan. 8 that it has made changes to its mobile ride-hailing platform in California, effective today, to adhere to a new state law that requires gig economy companies to categorize workers as employees.

Under the new law, previously dubbed Assembly Bill 5, Uber and other gig-economy companies like Lyft Inc. and food-delivery service DoorDash Inc. are no longer allowed to classify their workers as independent contractors.

San Francisco-based Uber said that as part of the changes to its app, drivers in California will now see estimated earnings and trip destinations prior to accepting a booking. It also said that the service fee that drivers are charged per trip will no longer exceed 25%, except for premium services like UberXL, Comfort, SUV and Lux trips.

In addition, trips with surge will now be calculated as multiples of the trip fare instead of fixed dollar amounts. Drivers can also now see the exact amount they will earn for every completed pickup on Uber Pool trips.

In participating cities where Quest promotions are available, Uber said drivers can pay a lower service fee for trips they take after they complete a certain number of Quest rides. The ride-hailing company said it is also replacing its Consecutive Trips promotion with a new campaign called Boost, which gives drivers a chance to lower their service fee by completing trips in certain locations during busy times of day.

Boost, unlike Consecutive Trips, will not have a minimum trip requirement, Uber said. It added that it plans to roll out similar features in its food delivery service Uber Eats.

Uber first announced changes to its app in California in December 2019.

The company, along with Lyft and DoorDash, has pledged $90 million to contest the new gig work law with a ballot measure this year. Uber and Postmates Inc. have also sued the state of California over the bill.