Uber, Lyft defeat unions in CA Prop. 22 fight

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App-based gig worker Terresa Mercado participates in a demonstration outside Los Angeles City Hall to urge voters to vote no on Proposition 22, a November ballot measure that would classify app-based drivers as independent contractors and not employees or agents, in Los Angeles, California, U.S., October 8, 2020.

App-based gig worker Terresa Mercado participates in a demonstration outside Los Angeles City Hall to urge voters to vote no on Proposition 22, a November ballot measure that would classify app-based drivers as independent contractors and not employees or agents, in Los Angeles, California, U.S., October 8, 2020. Photo by Mike Blake/Reuters

Hundreds of thousands of California rideshare drivers finally have clarity on their job classification — but it’s not the outcome their unions were hoping for.

A California appeals court ruled Monday that drivers can indeed be treated as independent contractors and not employees of Uber, Lyft, DoorDash and other platforms, reports CalMatters’ Grace Gedye.

If this sounds vaguely familiar, you’re probably thinking of Proposition 22 from 2020. Monday’s ruling upheld the initiative, which exempted rideshare companies from a law that would have required them to classify the estimated 300,000 to 400,000 Californians who provide rides or deliveries as employees. 

Rideshare companies poured more than $224 million into the initiative, according to Ballotpedia. At the time, it was the state’s most expensive ballot measure, only surpassed last year by two sports gambling propositions. The money paid off, with voters passing Prop. 22 by a 58% to 42% margin. 

Though Prop. 22 granted workers some benefits, including a partial health care subsidy under certain conditions, drivers still don’t have access to other workplace benefits, such as minimum wage, sick leave, unemployment benefits and more.

  • Jennifer Barrera, president of the California Chamber of Commerce: “Voters knew what they were voting on. They wanted to maintain the flexibility for these gig workers and provide them the opportunity to do this work.”

Despite Monday’s news, this likely won’t be the last we hear on the issue. The Service Employees International Union said it will “consider all options,” which includes seeking a review from the state Supreme Court. 

  • Lorena Gonzalez Fletcher, executive secretary-treasurer of the California Labor Federation: “The Appeals Court chose to stand with powerful corporations over working people… Our system is broken.”

This victory for Uber and Lyft affirms the efforts of private companies to go to the ballot box to block state laws they don’t like. The bail bond industry, for example, managed to overturn a law that would have ended cash bail, and the tobacco industry tried but failed to reverse a law banning certain flavored tobacco products.

Two California ballot measures for the upcoming 2024 election, one backed by the fast food industry and the other by oil and gas companies, also aim to block existing laws that could curtail their business operations.