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California leaning to keep app-based drivers contractors

Brian Melley | Hagadone News Network | UPDATED 4 years AGO
by Brian Melley
| November 3, 2020 11:03 PM

LOS ANGELES (AP) — A California ballot measure that would exempt Uber, Lyft and other app-based delivery drivers from being classified as company employees eligible for benefits and job protections had a strong lead Tuesday.

The more than $225 million measure bankrolled largely by the titans of the so-called gig economy is the most expensive in state history and had more than 58% of over 10 million votes counted so far. Supporters of the measure claimed victory, though millions of votes remained to be counted.

The ballot question aims to override lawmakers and the courts and determine whether drivers remain classified as independent contractors, which would preserve the companies' business model. Uber and Lyft, both based in San Francisco, have threatened to pull out of California if the proposition fails.

Opponents say the companies exploit drivers to keep profits high and that the ballot measure would deprive workers of other rights like overtime pay and workers' compensation.

Supporters say the measure would allow drivers to maintain the freedom to work hours they choose and would provide other benefits.

Bill French, 62, a former high school baseball coach voting in Huntington Beach, said he retired early so he could supplement his pay as an Uber driver and work when he wants. He voted in favor of the measure.

“I don’t need them to control me and tell me when I’m going to work and not going to work,” French said.

The gig economy powerhouses — with help from DoorDash, Postmates and Instacart — have collectively spent more than $205 million on Proposition 22 vs. labor's nearly $20 million.

The spending, which doesn't account for $30 coupons Uber Eats and other services have been offering customers to promote their brands, will likely put future ballot measure funding on steroids, said political science professor David McCuan of Sonoma State University.

“What Prop. 22 does is it raises the tide of all ballot measures,” McCuan said. “It sets records that are just going to be blown past the next time. ... It makes the parallel route of direct democracy a playground that will be measured in the billions in a few (election) cycles.”

If more than 50% of votes are in favor of the measure, drivers would remain independent contractors exempt from mandates such as sick leave and expense reimbursement. Drivers would receive some “alternative benefits,” including a guaranteed minimum wage and subsidies for health insurance if they average 25 hours of work a week.

If the measure fails, drivers would be subject to the same labor laws as other workers covered by the landmark state labor law known as AB5, which was aimed at Uber and Lyft and provides job protections and benefits.

State Attorney General Xavier Becerra took the companies to court, claiming they were misclassifying their drivers as contractors in violation of the law. A state appeals court recently sided with a San Francisco Superior Court judge who said the new employment standards apply to the app-based companies.

Uber and Lyft argued in court that their drivers meet the criteria to be independent contractors, not employees. They also said the law didn’t apply to them because they are technology companies, not transportation companies, and drivers are not a core part of their business.

That ruling could be undone by the outcome of the vote, though further litigation is likely, and the companies said they might appeal the earlier rulings to the California Supreme Court.

Some Uber drivers recently sued the company for sending ads supporting Proposition 22 in the app they use, claiming they were subject to political coercion. But another San Francisco judge rejected a request to block the ads, saying such a move would infringe on the company's First Amendment rights.

Nonpartisan polls by the Institute of Governmental Studies at the University of California, Berkeley, indicated the measure gained support from September to October as spending increased.

“It shows how cost prohibitive or how expensive a vote is,” McCuan said.

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Associated Press reporter Amy Taxin contributed to this report from Orange County.

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Find AP’s full election coverage at APNews.com/Election2020.

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