California voters have approved an electoral measure that allows gig economy companies Uber and Lyft to continue to treat drivers as contractors rather than employees.
Proposition 22, whose adoption is widely expected, exempts ride-hailing and app-based delivery companies from AB 5, a state law that would have forced them to classify drivers as employees – a radical reorganization of their business models.
As independent contractors, drivers enjoy flexibility but are not entitled to benefits such as health care, unemployment insurance, minimum wage and overtime pay.
The companies that supported this measure – Uber, Lyft, DoorDash and Postmates – advocated the independence of drivers and warned that changing their models would lead to fewer jobs, more expensive journeys and a restriction on the number of cities in which they could operate.
Critics of Prop 22, as it became known, rejected the claims and countered that it created a legal loophole for companies to exploit their workers for profit. While conceding defeat today, the union activists said their struggle would continue.
“We have led this struggle on the side of justice and with integrity, and I am proud of that forever. We will prevail,” Vanessa Bain, a gig economy worker and co-founder of the Gig Workers Collective, told Washington Newsday when it emerged that Prop 22 had been passed.
“For several years, gig workers and gig companies have been fighting a tug-of-war over our fate as high-stakes workers. I have been committed to this struggle for over four years, and nothing will change, no matter what the outcome.
At the time of writing, polls show that more than 6.7 million people (58.4 percent) voted for Prop 22, while 4.7 million people (41.6 percent) voted against it.
The app companies were a powerful opponent for the proponents of the work. Their deep pockets and lobbying skills meant that the “Yes to 22” campaign was the most expensive election campaign in California to date, with more than $205 million from donors like Uber, Lyft and DoorDash.
The money was put into a marketing campaign that included Facebook advertising and, in Uber’s case, integration into their app.
The “No on 22” campaign raised about $20 million, including funds from the Service Employees International Union and the United Food and Commercial Workers Union.
The coalition of Gig Economy companies said Prop 22 would provide drivers with new protections while at work, including a minimum 120 percent minimum wage, health subsidies and accident insurance. They pledged to introduce public safety safeguards, such as periodic background checks on drivers and mandatory safety courses.
“The end of this campaign is only the beginning in the fight for fair wages, sick pay and care for gig workers when they are injured at work,” said a spokesman for the advocacy group Gig Workers Rising ahead of the Newsday vote in Washington.
“The election has shown us just how unscrupulous these companies are […] they have chosen to fund a law that benefits themselves. Prop 22 is a corporate power grab.
“Our organization is strong and will continue long after election night. We will continue to organize to force Uber and Lyft to obey the law and give their workers the fair wages, sick leave, unemployment insurance and protection that all workers owe.
The Gig Workers Collective wrote in a blog post published today that the pro-prop 22 campaign relied on its wealth to spread “propaganda” through apps and television commercials, promising that its members would continue to be “ready to continue the struggle.
“These companies are clearly afraid, otherwise they would never have had to spend those $200 million-and it is the workers they fear. It’s only a matter of time before the law catches up with them,” they wrote.
AB 5 was incorporated into state law in September 2019, giving union activists hope that it will help give workers in the gig economy more rights. But it was immediately pushed back strongly.
In August of this year, a San Francisco court ruled that Uber and Lyft had violated AB 5 by misclassifying their workers and requiring them to treat drivers as full employees. The companies responded by threatening