If you drive for Uber or Lyft in California, something changed this year that no generation of gig drivers before you ever had. For the first time anywhere in the country, app-based rideshare drivers have a legal right to form a union and bargain collectively over pay and working conditions, and they get that right without giving up their status as independent contractors. The law that did it is Assembly Bill 1340, the Transportation Network Company Drivers Labor Relations Act, and in mid 2026 the machinery it created is starting to move.
This article walks through what the law says, who it covers, how the union process actually works, what the state's first round of data shows, and what drivers and companies can realistically expect next.
A First in the Nation Law for Gig Drivers
Governor Newsom signed AB 1340 on October 3, 2025, and the law took effect on January 1, 2026. It is codified at California Business and Professions Code section 7470 and the sections that follow, and it is administered by the Public Employment Relations Board, known as PERB, the same state agency that has overseen public sector labor relations in California for decades.
The core of the law is simple to state. Drivers for large rideshare companies have the right to form, join, and participate in a driver organization, to bargain through representatives they choose, and to engage in concerted activity for mutual aid or protection. They also have the right to refrain from all of that. Companies that interfere with those rights, or that retaliate against drivers for exercising them, can face unfair practice charges before PERB.
What makes AB 1340 unusual is what it does not do. It does not reclassify drivers as employees. After Proposition 22, California rideshare drivers are generally independent contractors as a matter of law, which means the National Labor Relations Act, the federal law that gives employees union rights, does not apply to them. AB 1340 fills that gap with a state system built specifically for this workforce. Drivers keep the flexibility of contractor status and gain a seat at the bargaining table. Whether those two things can coexist smoothly is one of the big questions of 2026.
Who Is Covered, and Who Is Not
The law applies to transportation network companies, meaning companies that use an app to connect drivers using their personal vehicles with passengers. But it does not apply to all of them equally, and it does not cover every driver.
- Covered companies. The Act's bargaining obligations fall on the largest platforms. Based on PERB's data for the first quarter of 2026, Uber and Lyft are the covered companies, together accounting for over 99 percent of the roughly 70 million rideshare trips completed in California in that quarter. Smaller platforms like HopSkipDrive, Wingz, and specialized medical transport services are currently noncovered.
- Active drivers. Union rights under the Act belong to "active" drivers, generally those who completed at least 20 rides in the preceding six months. Covered companies must send PERB a quarterly list of these drivers, including contact information and ride counts, so the agency can verify who is eligible to participate in organizing.
- Who is excluded. Drivers who are classified as employees under federal law are excluded, on the theory that they already have union rights under the National Labor Relations Act. Delivery-only platforms and other kinds of gig work are not covered by this law, although many observers expect similar proposals if the rideshare system works.
PERB's first published numbers give a sense of the scale. As of the data covering October 1, 2025 through March 31, 2026, there were 98,235 active rideshare drivers in California, and the median active driver completed 461 rides in that six month window. That is a bargaining unit larger than most private employers in the state.
How the Union Process Works, Step by Step
The process AB 1340 creates looks different from a traditional union election at a single workplace. It is sector wide, meaning a certified driver organization would negotiate industry level agreements rather than separate contracts shop by shop. Here is the path in plain English:
- A driver organization applies to PERB. Groups seeking to represent drivers first apply for designation as a TNC driver organization. PERB opened its first application window for this designation on April 21, 2026.
- The 10 percent showing. To start the certification process, a driver organization must show PERB that it has support from at least 10 percent of active drivers. PERB then verifies that showing.
- Drivers get notified. Once the 10 percent threshold is verified, the companies must notify active drivers that an organization is seeking to represent them, and the organization gets access to the eligible driver list.
- The 30 percent threshold and an election. If the organization demonstrates support from 30 percent of active drivers, PERB conducts an election by remote voting, which fits a workforce that has no common worksite.
- Majority support means certification. If an organization shows majority support, it can be certified as the drivers' representative. Once certified, the covered companies have a duty to bargain with it.
The subjects on the bargaining table are the ones drivers talk about most: compensation, benefits, safety standards, grievance procedures, and, notably, deactivation. For many drivers, the possibility of being deactivated by an app with little explanation and no meaningful appeal has long been the single most stressful feature of the job. A negotiated deactivation appeal process would be a significant change in how this industry handles disputes.
Where Things Stand in July 2026
The law is no longer theoretical. As of this summer, PERB has published its first covered company determinations, calculated the active driver and median ride figures, and opened the designation process for driver organizations. Companies are filing their quarterly driver lists, which PERB updates and shares on a January, April, July, and October cycle. No election has been announced yet, and organizing at this scale takes time, but the foundation is now in place.
There is also a legal cloud worth being honest about. Because AB 1340 builds a state labor relations system for workers the federal system does not reach, court challenges arguing that federal labor law preempts the state scheme are widely expected. The law was drafted to avoid that outcome by covering only independent contractors, who sit outside the National Labor Relations Act. How courts treat that design will shape not just California but every state watching this experiment. If the model survives, it could become a template for gig worker bargaining across the country.
What This Means for Drivers
For drivers, the practical takeaways in 2026 are fairly concrete:
- Participation is protected. Supporting a driver organization, signing an authorization, or talking with other drivers about organizing is legally protected activity under the Act, and so is choosing not to participate. Retaliation for either choice can be raised with PERB as an unfair practice.
- Your contractor status does not change. Joining or supporting a driver organization under this law does not make anyone an employee, and it does not affect Prop 22 benefits. The broader rules on worker classification still matter for other purposes, and our guide to independent contractor versus employee status in California explains how those tests work.
- Expect contact. Because companies must share active driver lists with PERB, and verified organizations eventually get access to eligible driver contact information, active drivers may start hearing from organizing campaigns. Whether to engage is each driver's own decision.
- Keep your own records. Ride counts determine who is an active driver, and pay and deactivation issues are likely to be central bargaining topics. Keeping screenshots and records of earnings, ride totals, and any deactivation notices is a sensible habit. Our article on documenting workplace issues covers the basics, and most of it applies to app-based work too.
What This Means for Companies and Employers
For the covered platforms, the compliance obligations are immediate: accurate quarterly driver lists, required notices when an organization reaches the 10 percent threshold, and a duty to avoid interference or retaliation while the process unfolds. Getting the early steps wrong could generate unfair practice charges before bargaining even begins.
For other California employers, AB 1340 is worth watching even if it does not touch your business directly. It signals where the state is heading. California lawmakers have shown they are willing to build entirely new dispute resolution and bargaining structures for workers who fall outside traditional employment law, and the themes at the center of this law, fair process before deactivation or termination, transparent pay, a real avenue for grievances, mirror what employees in conventional workplaces increasingly expect. Businesses that build fair internal processes now are generally better positioned than those that wait for a statute to require it. Our overview of new California workplace laws for 2026 shows how much ground the legislature covered in a single year.
Disputes Are Coming. Resolution Does Not Have to Mean War
Step back from the mechanics and AB 1340 is really a law about disputes. Drivers wanted a structured way to raise problems, from pay to safety to sudden deactivation, and to get answers from the companies on the other side of the app. The legislature responded by building a formal system with a neutral referee, defined procedures, and a path to negotiated resolution instead of litigation.
That same idea, giving both sides a structured, neutral place to work through a conflict before it hardens into a legal fight, is what Wiser Workplace does for California workplaces every day. Our platform lets an employee raise a concern confidentially, gives the employer a fair way to hear and respond to it, and brings in a neutral mediator when the two sides need help finding a resolution. We are not a law firm and we do not give legal advice. What we offer is a faster, calmer, and far less expensive alternative to letting a workplace problem escalate into a courtroom. If that approach makes sense to you, you can read about the benefits of staying out of court or join the launch waitlist.
California just gave nearly a hundred thousand drivers a new way to be heard. However the first elections and the inevitable court fights turn out, the direction is clear: the future of workplace conflict in this state runs through structured resolution, not silence.
Sources: Assembly Bill 1340 (2025), Transportation Network Company Drivers Labor Relations Act, California Business and Professions Code section 7470 et seq.; California Public Employment Relations Board, TNC Act page and Q1 2026 covered company data (perb.ca.gov/tnc-act); PERB news releases on TNC Act rulemaking and the April 21, 2026 driver organization designation window; CDF Labor Law LLP analysis of AB 1340 (October 8, 2025).