California’s Prop. 22 Vs. Workers

In a propaganda campaign described as “the most expensive in the state’s history,” Uber, Lyft, and others have spent nearly $200 million to try to convince California voters that “gig companies” deserve to be exempt from the law passed there earlier this year which closes loopholes that allow such companies to skirt labor laws, such as minimum wages, by not treating their drivers as employees. Veena Dubal, an associate professor at the University of California Hastings College of the Law, has characterized this as “following a long history in California of powerful groups ‘manipulating the way the public understands propositions,’” as reported in The Washington Post.

Uber has threatened to “cut off” over 150,000 drivers if the ballot measure passes, however, the New York Times says that, “Though Uber and Lyft, for example, are publicly traded companies with a combined worth of $70.5 billion, they have never been profitable.” The Times goes on to report, “They lose billions of dollars each year, and the pandemic has made turning a profit even more difficult.” When you consider the situation, this paints a picture of a few executives at the top trying to squeeze what money they can from a failed business model, while they can, at the expense of workers. It also suggests the aforementioned threat of cutting drivers loose may be the typical management tactic of threatening jobs when workers seek better conditions.

According to data from LIMRA, 16% of workers in the U.S. were “earning income exclusively from gig work” in mid-2019, and that number is growing. While a spokesman for the “Yes on 22” campaign touts the flexibility for drivers under this arrangement, a flexible schedule is no substitute for labor rights, especially if this is one’s only job. As Salon points out, “the gig economy is paving the road to serfdom,” and courts in Canada, the U.S., and the UK seem to agree. A UK Court of Appeals apparently went so far as to describe Uber’s description of their worker relationship as “a sham.”

Regardless of the outcome in California, this is yet another fight that concerned parties should keep their eyes on, as according to the Times, “Uber hopes to avoid continued state-by-state battles by pressing for federal legislation.”