In a win for third-party delivery services and other big tech companies, California has passed Proposition 22, ensuring gig workers will remain independent contractors rather than employees of these companies.
Uber, DoorDash, Instacart, and other tech companies that use gig workers to fulfill the last mile of food deliveries backed Prop. 22, which is the most expensive ballot-measure campaign in California history.
The measure, a response to California’s Assembly Bill 5, which was signed into law last year, exempts companies from having to actually employ drivers and in doing so pay for healthcare, sick leave, and other benefits.
Uber, DoorDash, and other companies that rely on gig workers have long said that classifying drivers as employees would drastically change the way the companies do business. Less talked about but just as obvious is the point that classifying drivers as employees would undercut delivery and rideshare services’ still-elusive profitability. In August, Uber and Lyft even threatened to pull out of California after a judge ordered the companies to reclassify their employees in keeping with AB 5.
Uber CEO Dara Khosrowshahi sent an email last night thanking drivers, saying, “The future of independent work is more secure because so many drivers like you spoke up,”
Prop 22. opponents, such as labor groups, argue that the measure allows Uber and other tech companies to skirt basic obligations to workers, including minimum wage, health insurance, and paid sick leave. That last item is an especially hot-button issue at a time when COVID-19 cases are on the rise once again.
Gig Workers Rising, which opposed Prop. 22, called the measure “a loss for our democracy that could open the door to other attempts by corps to write their own laws.”