The New York Times. April 04, 2020

THE NEW YORK TIMES, SATURDAY, APRIL 4, 2020 N B5

VIRUS FALLOUT

the same devastation as busi-
nesses in areas like travel or re-
tailing.
Instead, tech services are in-
creasingly in demand as millions
of people work and socialize from
home to avoid being infected by
the coronavirus. Amazon orders
have soared so much that the com-
pany has put a priority on ship-
ping essential items like soap,
food and toilet paper. Google has
provided temporary free access to
some of its remote work tools. And
Facebook’s traffic has surged.
“Amazon, Google and Facebook
are very well positioned,” said
John Blackledge, a tech analyst at
Cowen, adding that the companies
have substantial cash reserves to

weather an economic downturn.
Tech lobbyists have nonethe-
less seized the moment. In the
weeks before the virus swept the
United States, groups represent-
ing Google, Facebook and Twitter
already wanted the California at-
torney general, Xavier Becerra, to
wait to enforce the state’s new pri-
vacy rules until 2021.
The law, known as the Califor-
nia Consumer Privacy Act, re-
quires businesses to give people a
copy of the data that has been col-
lected about them, as well as the
ability to delete it. Companies
have complained that the rules
would place too many obligations
on businesses. The law went into
effect this year, but California will
not start enforcing it until July.
“We thought even before this
that there should be a delay,” said
Dan Jaffe, the group executive
vice president of the Association
of National Advertisers, because
of the slow speed with which the
rules were being enacted. Now the
pandemic has added urgency to
the groups’ request, he said.
In a letter on March 17 ad-
dressed to Mr. Becerra, more than
30 groups, including lobbying
blocs for non-internet businesses,
said many “companies have insti-
tuted mandatory work-from-
home measures to limit communi-
ty spread of the virus, meaning
that the individuals who are re-
sponsible for creating processes
to comply” with the law weren’t in
the office to work on the issue.
They asked him to wait to enforce
the rules until 2021.
“If you’re on a ventilator, you’re
not going to be doing a lot to be re-
sponding to a regulatory de-
mand,” Mr. Jaffe said. “I’m not try-

ing to pretend that that’s yet the

situation, but those are real-world

things that could happen.”

An adviser to Mr. Becerra,

speaking on the condition of ano-

nymity, said his office was still

committed to enforcing the rules

starting this summer. (This week,

Gavin Newsom, the governor of

California, delayed some regula-

tory processes in light of the vi-

rus.)

Facebook, Google and Twitter,

which are represented by some of

the groups that signed the letter,

declined to comment.

Other companies with growing

demand for their products have

pushed for deregulation or other

government action that would

benefit them, arguing it would im-

prove the response to the virus

crisis.

Trade associations represent-

ing drone makers like Amazon

and the Alphabet subsidiary Wing

have tried to expedite approval

for airborne deliveries — or waive

approvals altogether — and elimi-

nate prohibitions on the circum-

stances under which the devices

can be operated.

Amazon and Wing declined to

comment.

Instacart, the delivery start-up

that recently announced it would

hire 300,000 more grocery deliv-

ery contractors to meet new de-

mand, said it had told policymak-

ers that one of its priorities was

expanding a pilot program where

customers can use federal food

services, like the Supplemental

Nutrition Assistance Program, to

buy goods online.

Several lobbying groups repre-

senting the cloud computing in-

dustry, including Amazon and

Google, have also encouraged fed-

eral officials to grant faster ap-

provals for the services to be

adopted in light of the virus or to

provide more funding for federal

employees to work from home.

Matthew Cornelius, a former

federal official who leads the Alli-

ance for Digital Innovation, which

represents Amazon and Sales-

force, said rapid spread of tele-

work in the federal government

validated the industry’s argument

that agencies should be able to

more quickly use their products.

He hopes that after the immedi-

ate shock of the virus passes, he

said, the government and indus-

try will look at lessons in how the

government can increasingly do

work in the cloud.

“I think this is a tremendous op-

portunity,” he said.

Uber, too, has cast a long-waged

policy fight as newly urgent in

light of the coronavirus. For years,

the ride-hailing company, whose

drivers are contractors, has re-

sisted calls to make them full-time

employees. Federal law does not

require companies to give con-

tractors certain benefits and pro-

tections, like health insurance,

which can be expensive for com-

panies to provide.

Last year, California lawmakers

approved a measure meant to pro-

vide employment protections to

contractors, over the continued

objections of Uber, Lyft and oth-

ers.

In recent days, Dara Khosrow-

shahi, Uber’s chief executive, has

said the virus crisis shows the im-

portance of creating a new classi-

fication for workers who are nei-

ther employees nor contractors,

something the company pushed

for before the pandemic took

shape.

Last week, Mr. Khosrowshahi

wrote a letter to President Trump,

calling for the so-called third way

approach. He has also spoken to

lawmakers on Capitol Hill, includ-

ing Senator Chuck Schumer of

New York, the Democratic leader,

since the outbreak began.

Privately, Uber has gone fur-

ther. The company has asked law-

makers to shield it from lawsuits

over how its drivers are classified

if it provides the drivers with med-

ical supplies or compensation dur-

ing the pandemic, according to a

mid-March email obtained by The

New York Times. A labor lawyer

recently asked courts in California

and Massachusetts to reclassify

Uber and Lyft drivers as employ-

ees in light of the crisis.

An Uber spokeswoman, Susan

Hendrick, said in an email that a

so-called safe harbor provision to

shield the company from lawsuits

would let it provide benefits to

drivers until the law was perma-

nently changed.

Lyft said in a statement that it

was not proactively seeking such

a safe harbor from lawsuits but

that it would back one.

The idea pushed by Uber has

gained traction in Congress. Last

week, a bipartisan group of law-

makers sent congressional lead-

ers a letter asking for the legal

shield that the ride-hailing compa-

nies support.

Some in the tech industry are

sensitive to any appearance they

are seizing on a crisis for their

own gain.

Aaron Cooper, vice president

for global policy at BSA, an enter-

prise software trade group, said it

believed that increased sharing of

private and public data could help

improve the response to the virus.

But he bristled when asked if BSA

was lobbying to trim regulations

that might hold that kind of shar-

ing back.

“It’s not the right time to be try-

ing to push the government to

change rules,” he said.

In Frenzy of Pandemic, Tech Firms See Chances for Lobbying

FROM FIRST BUSINESS PAGE

BRYAN BANDUCCI FOR THE NEW YORK TIMES

WING, VIA ASSOCIATED PRESS

Kate Conger contributed reporting

Uber is pushing harder to avoid classifying its drivers as employees. from San Francisco.

JEENAH MOON FOR THE NEW YORK TIMES

Urging California

to delay a law while

compliance employees

work from home.

Drone makers have lobbied for approval of airborne deliveries.

Orders through Amazon, which owns Whole Foods, have been soaring.

AIRLINES

Delta and JetBlue Warn

Of Severely Lower Revenue

The chief executive of Delta told

employees on Friday that the air-

line expected revenue in the sec-

ond quarter to be 90 percent lower

than the same quarter last year.

The announcement was a down-

ward revision from just two weeks

ago when the company warned of

an 80 percent decline.

And the chief executive of Jet-

Blue warned that April revenue

was expected to be about 95 per-

cent lower than last year.

Both companies, along with

United Airlines, said they had sub-

mitted applications for federal

stimulus funds to pay employees

through September.

MARKETS

Pimco Is Tapped to Help

With Relief Effort

The Federal Reserve Bank of New

York has retained Pacific Invest-

ment Management Company,

known as Pimco, to run a program

meant to calm the market for

short-term business debt.

Pimco managed a similar pro-

gram during the 2008 financial

crisis.

The investment manager has

been retained on a short-term ba-

sis for “its knowledge and experi-

ence in the commercial paper

market and in credit risk manage-

ment and its operational and tech-

nological capabilities,” according

to the New York Fed. State Street

Bank & Trust Company will act as

custodian.

Pimco has many connections at

the central bank. Richard H. Clar-

ida, the Fed vice chair, formerly

worked at the company. Ben S.

Bernanke, who was Fed chair dur-

ing the Great Recession, is now a

senior adviser.

RETAIL

Hobby Lobby to Close Stores

And Furlough Most Employees

Hobby Lobby, the arts-and-crafts

chain that was accused of defying

lockdown orders in at least four

states during the coronavirus out-

break, announced on its website

that it would close its stores at 8

p.m. Friday.

The retailer also said it would

furlough most of its employees

without pay.

“We encourage furloughed em-

ployees to file their claims with

their state’s unemployment com-

missions as soon as possible,” the

company said in a statement.

State and local authorities in

Colorado, Indiana, Ohio and Wis-

consin took action against the re-

tailer this week in an effort to shut

the stores as governors across

much of the United States have

signed stay-at-home orders and

health authorities have urged

Americans to practice social dis-

tancing.

Virus Briefing

store.nytimes.com

800.671.4332

Times Style.

Presenting the contemporary collection of New York Times goods from the Store.