Prop 22: WHat’s at stake for labor?

By Sarah Kowaleski

A Narrow Proposition

This November in California, multi-billionaire Gig corporations such as Uber, Lyft, Postmates, DoorDash and Instacart spent more than $200 million to back a deceptive California state proposition known as Prop 22. This was a corporate backlash to a new law in California, known as AB5, that rightly classified gig workers as employees. Despite all of their millions and resorting to deceptive tactics, gig corporations won, narrowly. Only 58% of California voters backed Prop 22, the gig-worker proposition. 

Prop 22 has both enabled gig corporations to continue misclassifying their workers as “contractors” and has given the industry a playbook they hope to replicate in the face of rising Labor movements worldwide.

What’s in it for Gig Employers?

Proposition 22 was based around the fear that their workers, given the proper wages and protections of employees would annihilate the gig business model based on hyper exploitation. Uber and the like see their ‘success’ with Prop 22 in California as a way to thwart regulations that apply to every other employer. In fact, just after the win, Uber CEO Dara Khosrowshahi told analysts, “We feel strongly that this is the right approach, and it’s a priority for us to work with governments across the U.S. and the world to make this a reality.”  32 other states already use the same legal test to determine worker classification as California’s, so Gig corporations are keen to export this approach to other states. They know that “not real employee” status is inferior to “employee” status, so they wish to enshrine this everywhere, permanently.

What’s at stake for Labor and communities?

Measures like Prop 22 allow wealthy corporations to deny their drivers rights and protections like paid sick leave, workers compensation, and unemployment benefits. What’s at stake include good union jobs that pay fair wages, and small businesses, as gig corporations drive down standards in order to drive up their competitive advantage. Gig corporations want to maximize their profit and expand their low-pay, no-protection business model to virtually every industry, leading to unprecedented job loss and a race to the bottom. 

Now, gig corporations are pouring resources into state legislation and forming industry lobby groups such as the App-Based Work Alliance, to accomplish their goal of rolling back workers’ rights and to pre-emptively stifle worker organizing and consumer advocacy for stronger protections. This makes us all less safe by eliminating safety protections for riders and drivers and any liability these wealthy corporations have to consumers.

Stay tuned for ways you can support Gig workers organizing, pushing back on greedy corporate plans to erode the rights of employees. We must not take these rights for granted!