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Uber, Doordash, and Instacart spent more than $200 million to promote it, making this the most expensive referendum in state history.
California voters passed a ballot initiative Tuesday backed by Uber, Lyft, DoorDash, and Instacart, which collectively spent more than $200 million to promote it. It’s the latest—and perhaps final—volley in a years-long battle over whether or not the apps’ drivers need to be classified as employees.
Specifically, Proposition 22 defines app-based delivery and other drivers as independent contractors, contrary to a California law that went into effect on January 1 (more on that later). It also includes provisions that guarantee certain worker protections, like healthcare subsidies and a wage floor set at 120 percent above the minimum wage. But these protections aren’t exactly as cushy as they sound, California Matters reports: The minimum wage provision is based on a driver’s “engaged time,” which does not include time spent waiting for rides. (Drivers have argued that, when wait time is included, their wages dip below the state minimum.) Overall, CalMatters concludes, the protections are a “milder alternative” to rights granted to full employees under state law. Translation: They’re a watered-down yet progressive-sounding compromise that allows Uber and Lyft to claim they’re guaranteeing decent pay for their drivers.
“But know this: Our movement is strong and will not go away.”
The ballot initiative, the most expensive in California’s history, is a direct response to a ruling by the state’s Supreme Court and the subsequent passage of a state law that would have forced app-based companies to reclassify their workers as employees. The change would have ensured basic protections like minimum wage, sick pay, and the right to organize. Assembly Bill 5 was supposed to take effect on January 1, 2020, but tech companies successfully stalled it in court as they sought to win voters’ support of the ballot measure.
Assembly Bill 5 would have prompted a fundamental shift in the business models of rideshare companies, which force drivers to shoulder expenses like taxes, vehicle maintenance, and sick time, in exchange for scheduling flexibility. The companies outspent their opponents at a rate of 10 to one. These aggressive campaign tactics included threatening to cut off service in California, pushing pro-Proposition 22 messages to riders through the app, and major spending on advertising. According to the Washington Post, the passage of the measure may embolden Uber and Lyft to pursue similar legislation in other states.
Labor advocates vowed to continue fighting for reclassification. “Prop 22 is an illegitimate carve-out for the greedy few who want to rig the rules in their favor, and continue to deny their workers wages, sick leave, workers compensation, and unemployment,” said Cherri Murphy, an Oakland-based Lyft driver and organizer for Gig Workers Rising. “But know this: Our movement is strong and will not go away. We will keep fighting until all workers are treated with the dignity and respect we deserve.”
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