CALIFORNIA VOTERS APPROVE UBER-LYFT-SPONSORED PROPOSITION 22 EXEMPTING RIDESHARING DRIVERS FROM LABOR PROTECTIONS

Written by Taher Kameli & Chathan Vemuri

In an earlier post, we talked about how the First District Court of Appeal in California ruled that Uber and Lyft drivers were employees and were entitled to full protections under California’s Assembly Bill 5 law (AB5) such as paid sick leave, overtime, and fair wages.[1] Around the same time, however, Uber and Lyft were sponsoring a state ballot-initiative for Election Day known as Proposition 22 that would have exempted their drivers from the protections of AB5 and identified them as “independent contractors” rather than “employees.”[2] This would override the state Appellate Court’s decision and set the legal standard for how ridesharing drivers would be classified for labor law purposes. This is exactly what happened last week.

On Tuesday, November 3 of 2020, on Election Day, California voters passed the Proposition 22 ballot measure exempting gig companies from treating their drivers as employees as opposed to independent contractors.[3] This followed a record-breaking expensive campaign led by Uber and Lyft (amounting to $200 million) to promote the ballot measure, outspending that of opponents of the measure such as the California Labor Federation.[4] Whether it was ads at common thoroughfares such as billboards, mailers, commercial advertisements, ads at public events such as sports competitions, or, most importantly, notifications on the apps themselves supporting the measure, Uber and Lyft spread positive awareness of the measure far and wide.[5] They particularly appealed to riders sense of convenience, emphasizing longer wait times and higher priced fares if the Proposition did not go through.[6] Experts point out that voter reliance on these services and desire to avoid disruptions in them, coupled with lack of knowledge about the specifics about the legal dispute allowed companies like Uber and Lyft to set the terms of the debate around Proposition 22, attracting voters’ support even if they didn’t fully understand the different sides of the issue, much less support one side or the other.[1] The desire alone to continue relying on these services meant support for Proposition 22, especially as Uber and Lyft both publicly threatened to leave California if…