California passed AB 1340, granting certain gig drivers the right to unionize, bargain collectively, and engage in concerted activities without being classified as employees. The law takes effect January 1, 2026, and applies to drivers working for Transportation Network Companies (TNCs) like Uber and Lyft.

This legislation complements SB 371, signed just two days later, which slashes rideshare insurance costs and further bolsters the gig economy. Learn more about SB 371.

These complementary laws showcase California's forward-thinking approach to the gig economy, fostering growth and fairness for all stakeholders.

The Public Employment Relations Board (PERB) will enforce the Act's provisions, including resolving labor disputes, adjudicating unfair practice charges, and overseeing elections.

AB 1340 only covers drivers classified as independent contractors under federal law or National Labor Relations Board rulings. Those already classified as employees are excluded since they already have unionization rights under federal law.

Starting January 1, 2026, covered TNCs must submit quarterly to PERB a list of drivers who completed at least 20 rides in the past six months. The list includes each driver's name, license number, contact information, date joined, and ride count. PERB calculates the median ride count and identifies "active" drivers—those meeting or exceeding the 20-ride threshold over the prior six months.

The unionization process differs from the National Labor Relations Act. A driver organization can begin organizing by showing PERB it has 10% support among active drivers. PERB has 30 days to verify the threshold is met.

If verified, TNCs must notify active drivers within 30 days that the union is seeking to represent them. Only after certification can PERB provide the union with the list of eligible drivers. The union then needs 30% support to trigger an election conducted through remote voting.

If the union shows more than 50% support, there's no election—the union is automatically certified.

The law reflects California's ongoing effort to balance worker protections with the realities of app-based work, particularly after Proposition 22 classified TNC drivers as independent contractors.

This is progress for workers who've been stuck in a legal gray area for years. AB 1340 creates a path for drivers to organize and negotiate collectively without forcing the employee classification that many drivers don't want and that companies have fought hard against.

The 10% threshold to start organizing is lower than traditional union drives, making it easier for drivers to begin the process. The 30% threshold for elections and automatic certification at 50% are reasonable checkpoints that prevent either side from gaming the system.

But there's a timing issue nobody's talking about: autonomous vehicles. Waymo and Uber are already expanding robotaxi services to Austin and Atlanta. DoorDash and Serve Robotics are deploying delivery robots across multiple cities. Tesla just launched its Robotaxi service in the Bay Area and Austin. These unions are organizing just as the technology that could replace their members is hitting commercial scale.

Will these unions push back against autonomous vehicle deployment? Probably. That's what unions do when automation threatens jobs. But the reality is that California can mandate unionization rights all it wants—if autonomous vehicles prove cheaper, safer, and more reliable, the market will shift regardless of union resistance.

The question isn't whether unions can stop autonomous vehicles. They can't. The question is whether they can negotiate transition support, retraining programs, and job guarantees while the technology scales up. That's where collective bargaining actually matters.

Drivers organizing now might get a few years of better wages and working conditions before the technology makes large-scale human driving economically obsolete. That's worth fighting for, but it's also not a permanent solution.

The collision between AB 1340 and autonomous vehicles is going to be messy. California just gave gig workers collective bargaining rights at the exact moment those jobs are becoming automatable. Waymo's operating 100,000+ trips per week, Tesla's launching in multiple cities, Lyft's building AV fleet infrastructure, and Amazon's Zoox is hitting the streets. The autonomous vehicle future isn't theoretical—it's operational.

That's either incredibly well-timed for getting transition benefits, or it's locking the barn door after the horse has already left. What's certain is that unionization rights won't stop the technology. The economics of autonomous vehicles are too compelling—no labor costs, 24/7 operation, lower insurance rates.

This is exactly why Uber's partnering with Waymo, Lucid-Nuro, and May Mobility while Lyft's working with Waymo, Tensor, and May Mobility. Both platforms are building insurance policies against rising labor costs. If unionization pushes driver compensation too high, they'll shift volume to autonomous fleets. The multi-partner strategy ensures they're ready when that transition becomes economically necessary.

Source: JD Supra