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Californian voters passed Proposition 22, a controversial bill categorizing gig workers as contractors, which denies minimum wage or benefits.
Californian voters passed Proposition 22, a controversial bill categorizing gig workers as contractors, which denies minimum wage or benefits.
On this Tuesday, Election Day, California voters passed an Uber and Lyft backed bill, the California Proposition 22. During the so-far yearlong battle to pass the proposition, both sides of the ballot measure have been extremely insistent on their backed side winning.
Proposition 22 is an extremely controversial measure, which would strip gig workers, such as Uber drivers, from any and all worker benefits. This includes a minimum wage, healthcare, a 401K, and all sorts of other benefits from a standardized job.
Workers are now classified as contractors, which allow businesses that “contract” them, such as Uber or Lyft, to get away with no worker benefits and no minimum wage.
This proposition is likely to cause national effects, as other states are likely to follow in California’s footsteps. If gig companies were unable from passing this measure, it result in exponentially higher expenses and entirely redeveloped business models.
With the vote passed however, it allows them to minimize expenses and focus this large win into other regions across the US and across the world.
Early on in polling, whether or not the proposition would be passed was not very easily determined. 46% of voters backed the proposition and 42% opposed it, with 50% of the vote, minimum, to pass. According to the California Secretary of State, this morning, the bill passed with 58% of the vote.
The proposition was pushed incredibly hard by gig companies, such as Uber, Lyft, DoorDash, Grubhub, Postmates, due to the potential expense savings. These companies contributed more than $205 million to the campaign, with a Monday Uber spend of $1 million, last minute.
According to Ballotpedia, the initiative from these five companies marks the most expensive ballot measure campaign in California, and one of the most expensive in the entire US.
A no for the proposition would mean that gig workers would now be classified as employees. The argument behind this involved not guaranteed minimum wage, and that health care would need to be more substantial than what was provided. Under California law AB5, this would mean:
A yes for the proposition meant that workers would still be classified as non-employees, and would officially be classified as contractors. Contractors don’t receive benefits or a minimum wage, since they’re effectively hired for whatever their contract happens to be.
In Uber or Lyft’s case, this would mean whatever percentage they get from the ride. That would be all of their income from the company, since they would be in miniature contracts with riders.
As Election Day approached this Tuesday, yays and nays went into overdrive with campaigning and advertising.
Uber, Lyft, and whoever else was in the left campaigning coated social media and TV stations throughout California with ads, which according to MarketWatch, totaled almost $100 million. The market also sent messages through apps and emails, asking for support from riders and drivers.
According to CNET,
“One email Uber sent customers on Monday reminded Californians they could register to vote even on Election Day. It then asked customers to “join the NAACP and California Small Business Association in supporting drivers by voting yes on Prop 22.”
The California chapter of the NAACP did endorse the Yes campaign — that backing came as a small consulting firm run by the chapter’s president was paid $85,000 by the campaign. The national branch of the NAACP did not endorse the ballot measure.”
The yes side of campaigning focused their main reasoning behind their support for lowered expenses through “independent studies.” Most of these independent studies also happened to be paid for by said companies.
While these independent studies say that this is better for drivers and the companies behind the platforms, others disagree.
A large amount of drivers and riders both believed that those who worked for these companies should receive ample compensation and benefits.
In response to this, Lyft spokeswoman Julie Wood said “drivers have consistently said they want to remain independent, and we believe California voters will stand with them.”
On the other side of the proposition, nays were supported from some high-level Democrats. Presidential nominee Joe Biden and Californian vice presidential nominee Kamala Harris, as well as much of the Democratic Party are heavily supporting no.
Their pretense is the increased income for the drivers, combined with the unfair hours and working conditions provided, for below minimum wage and with zero benefits.
Overall, due to this proposition passing, it marks a very weird time to be a gig worker, and a very good time to be a gig company. By being able to hire workers without giving them minimum wage or worker benefits, companies are able to squeeze out more profit, while at the person al expense of all of their not-employees. We’ll have to see not only how this plays out in California, but how this’ll play out across the rest of the world.
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