Please ensure Javascript is enabled for purposes of website accessibility
Uber, Lyft Spend Big, Win in California Vote About Drivers
gvw_ap_news
By Associated Press
Published 4 years ago on
November 4, 2020

Share

LOS ANGELES — Uber, Lyft and other app-based ride-hailing and delivery services spent $200 million in a winning bet to circumvent California lawmakers and the courts to preserve their business model by keeping drivers from becoming employees eligible for benefits and job protections.

The titans of the so-called gig economy bankrolled the most expensive ballot measure in state history, which was decided Tuesday with 58% of more than 11 million voters choosing to keep drivers classified as independent contractors able to set their own hours.

Shares of both companies surged 11% to 13% before the opening bell Wednesday after the huge victory.

The outcome was a defeat for labor unions that had pushed for a state law aimed directly at Uber and Lyft, mandating they provide drivers with protections like minimum wage, overtime, health insurance and reimbursement for expenses.

Supporters of Proposition 22 said the outcome showed voters wanted to preserve the flexibility of the current system. Opponents said the companies had bought their own law and vowed to continue fighting for drivers’ rights.

San Francisco-based Uber and Lyft had threatened to pull out of California if they lost. They got additional support in the fight from DoorDash, Postmates and Instacart, which all could have had their businesses upended if it failed.

The Companies Sought an Exemption

Labor-friendly Democrats in the Legislature last year passed the landmark law known as AB5 to expand a 2018 ruling by the California Supreme Court that limited businesses from classifying certain workers as independent contractors.

The companies sought an exemption, taking their fight to voters with a campaign that included TV ads, mailers and messages that appeared on their app for both customers and drivers.

Opponents said the companies exploit drivers to keep profits high and the ballot measure would deprive workers of rights like overtime pay and workers’ compensation.

Supporters said 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 who voted for the measure in Huntington Beach, said he retired early so he could supplement his pay as an Uber driver and work when he wants.

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

More than $225 million was spent on the race, with unions kicking in about $20 million of that.

“The obscene amount of money these multibillion-dollar corporations spent misleading the public doesn’t absolve them of their duty to pay drivers a living wage,” Art Pulaski of the California Labor Federation said in a statement. “The end of this campaign is only the beginning in the fight to ensure gig workers are provided fair wages, sick pay and care when they’re hurt at work.”

The Measure Had Support Nearly Statewide Except in the San Francisco Bay Area

The spending, which didn’t account for $30 coupons Uber Eats and other services offered 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.”

The measure had support nearly statewide except in the San Francisco Bay Area and a sliver of coastal counties to the north.

Although drivers would remain independent contractors exempt from mandates such as sick leave and expense reimbursement, they would receive some “alternative benefits,” including a guaranteed minimum wage and subsidies for health insurance if they average 25 hours of work a week.

Uber CEO Dara Khosrowshahi sent a letter to drivers late Tuesday thanking them for their support and promising details in coming weeks on how they can enroll in benefits such as accident insurance.

The will of the voters could undermine a recent appeals court decision that sided with state Attorney General Xavier Becerra, who sued the companies for misclassifying drivers as contractors in violation of AB5.

RELATED TOPICS:

DON'T MISS

Crescent View West High Celebrates New Clovis Home

DON'T MISS

Fresno Man Sentenced to 29 Years for Sexually Assaulting Children and Dog

DON'T MISS

Bulldogs’ Two-Position Standout Tommy Hopfe Signs With Rockies

DON'T MISS

Artists, Vendors Plan to Defy City’s ArtHop Crackdown

DON'T MISS

Former Bulldog QB Jake Haener: I Have a ‘Rare Form of Skin Cancer’

DON'T MISS

The Many Names of GOP Vice Presidential Nominee JD Vance

DON'T MISS

‘Fed Up’ Dyer, Councilmembers Unveil Plan to Crack Down on Street Campers

DON'T MISS

House Republicans Slam Trump’s ‘Worst Choice’ for VP Pick JD Vance

DON'T MISS

Companies Cut Prices to Boost Sales, Consumers Respond

DON'T MISS

Stay Cool, Fresno!

UP NEXT

The Many Names of GOP Vice Presidential Nominee JD Vance

UP NEXT

Warner Bros. Discovery Sues NBA for Not Accepting Its Matching Offer

UP NEXT

Uber, Lyft, DoorDash Workers Remain Contractors Due to California Supreme Court Ruling

UP NEXT

Netanyahu Will Meet Trump at Mar-a-Lago, Mending a Yearslong Rift

UP NEXT

Recall of Boar’s Head Deli Meats Announced During Investigation of Listeria Outbreak

UP NEXT

Spicy Dispute Over the Origins of Flamin’ Hot Cheetos Winds up in Court

UP NEXT

Arson Suspect Named as Park Fire Near Chico Triples in Size

UP NEXT

Eye-Popping Construction Costs Intensify California’s Chronic Housing Shortage

UP NEXT

A Man Got Third-Degree Burns Walking on Blazing Hot Sand in Death Valley, Rangers Say

UP NEXT

CalFire Makes Quick Arrest of Arson Suspect in Explosive Park Fire Near Chico

Artists, Vendors Plan to Defy City’s ArtHop Crackdown

8 hours ago

Former Bulldog QB Jake Haener: I Have a ‘Rare Form of Skin Cancer’

9 hours ago

The Many Names of GOP Vice Presidential Nominee JD Vance

9 hours ago

‘Fed Up’ Dyer, Councilmembers Unveil Plan to Crack Down on Street Campers

9 hours ago

House Republicans Slam Trump’s ‘Worst Choice’ for VP Pick JD Vance

10 hours ago

Companies Cut Prices to Boost Sales, Consumers Respond

10 hours ago

Stay Cool, Fresno!

11 hours ago

Warner Bros. Discovery Sues NBA for Not Accepting Its Matching Offer

11 hours ago

Tanker Plane Crash Kills Firefighting Pilot in Oregon as Western Wildfires Spread

11 hours ago

Will Bonta Election Lawsuit Reverse the Will of Fresno County Voters?

11 hours ago

Crescent View West High Celebrates New Clovis Home

The arch of colorful balloons over the doorway of a storefront on Shaw Avenue in Clovis was a clue that something exciting was happening on ...

7 hours ago

7 hours ago

Crescent View West High Celebrates New Clovis Home

8 hours ago

Fresno Man Sentenced to 29 Years for Sexually Assaulting Children and Dog

8 hours ago

Bulldogs’ Two-Position Standout Tommy Hopfe Signs With Rockies

8 hours ago

Artists, Vendors Plan to Defy City’s ArtHop Crackdown

9 hours ago

Former Bulldog QB Jake Haener: I Have a ‘Rare Form of Skin Cancer’

9 hours ago

The Many Names of GOP Vice Presidential Nominee JD Vance

9 hours ago

‘Fed Up’ Dyer, Councilmembers Unveil Plan to Crack Down on Street Campers

10 hours ago

House Republicans Slam Trump’s ‘Worst Choice’ for VP Pick JD Vance

MENU

CONNECT WITH US

Search

Send this to a friend