Californians are being asked to decide whether Uber, Lyft and other app-based drivers should remain independent contractors or be eligible for the benefits of being employees of the company.

The battle between the powers of the so-called odd-job economy and unions, including the International Brotherhood of Teamsters, could become the costliest ballot measure in state history. Voters are questioning whether to create an exemption to a new state law aimed at providing wage and social protections for drivers.

Uber and Lyft have fought a losing battle in the legislature and the courts, so now – with help from app-based food delivery companies DoorDash, Postmates, and Instacart – they’re spending over $ 180 million on lead their fight directly to voters in November. 3 election.

Early voting in California begins Monday. Uber and Lyft, both based in San Francisco, have said they could leave the state if the measure fails.

The historic labor law known as AB5 threatens to upend the app-based business model, which offers great flexibility to drivers who can work when they want. But they are giving up protections like minimum wages, overtime, health insurance and reimbursement of expenses.

“What is at stake is the future of work, the nature of work, how conditions are changing for households amid the pandemic and recession,” said David McCuan, chairman of the department of political science from Sonoma State University in California.

Worker-friendly Democrats in the legislature passed legislation last year to extend a 2018 California Supreme Court ruling that barred companies from classifying workers as independent contractors.

Uber and Lyft maintained that their drivers met the criteria to be independent contractors, not employees. They also argued that the law does not apply to them because they are technology companies, not transport companies, and drivers are not at the heart of their business.

Attorney General Xavier Becerra sued the companies and a San Francisco Superior Court judge ruled the companies were subject to the new employment standards. But that decision has been put on hold while the companies appeal.

Any decision could be overturned by the outcome of the vote, although further litigation is likely.

If Proposition 22 is adopted, it would exempt transport and delivery companies based on employment law applications and drivers would remain independent contractors exempt from mandates for overtime, sick leave and reimbursement of expenses.

But it would also put in place policies requiring these companies to provide “alternative benefits,” including a guaranteed minimum wage and health insurance subsidies if they work an average of 25 hours a week.

Proponents say drivers appreciate the independence and flexibility of the current model.

“If I want to work four hours and say, ‘I’m done,’ I can do it,” said Doug Mead, a Palm Springs retiree who delivers meals for Uber Eats and Postmates and estimates he earns about $ 24. $ per hour. “Where is there an employer on the planet where I can do this?” “

Opponents say companies exploit workers and will not pay as much as supporters claim.

Saori Okawa, who drove 10 hours a day, six days a week for Uber in San Francisco for a year and now delivers food, said she wanted more protections for drivers, many of whom are immigrants like her. .

She thinks she was making almost $ 10 an hour after factoring in expenses that included renting a car for $ 1,000 a month. She said the hours were long and stressful and she had an accident which, had it resulted in injuries, would have resulted in hospital bills and unpaid time off.

“Before going to work, I always prayed to God… to protect me,” Okawa said. “The traffic is crazy.

Rideshare and delivery companies have spent more than $ 180 million so far to push through the measure, while labor groups have spent more than $ 10 million to defeat it.

McCuan said the companies were likely to pay an additional $ 100 million or more, making it more expensive in today’s dollars than a 1998 proposal that allowed Native American tribes to operate casinos in California.

“Big Tech has joined in with the big and bad bad guys in California politics,” McCuan said. “If you’re going to push something and you’re going to have a hard time in the Legislature because Democrats own the Legislature and Labor is a 900-pound gorilla in Sacramento, you have to… go around the Legislative Assembly.”

Most of the state’s largest newspapers, which have been granted exemptions for freelance writers and a temporary reprieve for drivers who deliver their publications, have written editorials in support of the measure.

The San Francisco Chronicle called the measure flawed, but said it was trying to strike a balance between workers and businesses that “will keep app-based, ridesharing and delivery services in California.”

“The legislative reluctance and lawsuits of worker-dependent politicians in the state capital, San Francisco and elsewhere give us no certainty that a reasonable solution could be found if the initiative fails,” the newspaper writes.

The coronavirus pandemic has hammered Uber and Lyft as more people work from home and are not traveling. On the flip side, more and more people are ordering food and grocery deliveries from app-based services like Postmates and Instacart. Some gig workers have moved to these platforms to work, earning what they say are lower wages.

A majority of Uber and Lyft drivers surveyed in an hour recently at Los Angeles International Airport said they supported the measure, all citing the freedom to set their own schedules and work other jobs.

Jeff Hodge, a stand-up comedian in search of his big breakup, sees the pros and cons on both sides, but being independent suits him better.

“If I were an ordinary Joe, I would be an employee,” Hodge said. “It all depends on your lifestyle. If I didn’t do anything else, I would like the benefits. I wish I could come and guarantee a certain number of hours, get a certain salary, go home.


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California Personal Auto Sharing Economy Carpool Entrepreneurs Uber