Gig Companies Buy Immunity From Labor Protections
By: Bri Jackson
Tags: Policy, Workers Rights, Gig Economy, Minimum Wage, Politics

Credit: Athena via Pexels

While the whole country was wrapped up in a contentious presidential election, gig companies in California were biding their time. Corporations like Uber, Lyft, DoorDash, Instacart, and Postmates spent $200 million advertising in favor of the highly damaging California ballot measure known as Proposition 22, which would categorize gig workers as independent contractors. The classification exempts these corporate behemoths from giving their workers the benefits entitled to company employees such as a minimum wage, health insurance, and sick pay.

The proposition spits in the face of hard-won labor protections that have existed in the United States for decades. In fact, the California Supreme Court had previously upheld Assembly Bill 5 (AB 5), enacted on January 1st of this year, which sought to protect gig workers and classify them as full employees. Despite the overwhelming harm to California workers if the legislation were reversed, voters passed Proposition 22 with a strong majority of 58%. With the passage of Prop 22, corporate greed has bought out the opinions, and votes, of Californians and stripped rights from workers who desperately need them.

If you’re asking “Why??” and slapping your forehead, you are not alone. Let’s quickly examine the history of gig legislation this year in California to understand. AB 5 protected workers by instituting a three-point framework to classify any worker as an independent contractor: the worker must have control over how they work, they must be free to seek work elsewhere, and their labor cannot be central to the company’s business. A major win for workers and labor unions, the bill helped to categorize gig workers as employees entitled to the same benefits as other workers.

As expected, AB 5 was promptly vilified by gig companies who immediately began searching for a way to overturn the legislation that was hurting their bottom line. Uber and Lyft argued that one of the main benefits of working for them was drivers’ flexibility to make their own schedule, but that AB 5 would force the companies to schedule drivers and reduce their total workforce to remain profitable. The ride-sharing companies also claimed that workers have significant control over how they work because of the scheduling flexibility. But, as is the case with so many of their claims, it is a farce. In fact, Uber sets drivers’ base fares, assigns drivers specific routes, and fires drivers by “deactivating” their accounts for inactivity or for receiving low passenger ratings. In reality, it seems drivers have little control over what they charge as well as when and where they work.

In response to AB 5, Uber and Lyft immediately took to advertising for a counter-legislation through ballot proposal. And, thus, Prop 22 was born. In spite of the obvious consequences of not providing basic labor protections to workers, voters went to the polls and cast their ballots to counter the basic rights of their fellow Californians anyway.

The passage of Proposition 22 was the result of a ceaseless campaign by gig companies to manipulate voters and convince workers that the measure would benefit them. During the campaign, Uber and Lyft maintained that, under the proposal, they would be providing their workers with a minimum wage and a healthcare stipend to offset the cost of having to buy their own health insurance. Yet again, the gig companies have intentionally misrepresented the realities of enacting the proposal. Prop 22 avoids guaranteeing independent contractors a minimum wage by modifying the activities that count as “worked” time, lowering actual wages from $12 an hour to an estimated $5.64. In addition, the healthcare stipend is estimated to be a paltry $30 per pay-period — hardly a drop in the bucket.

All of these negative effects on workers are made worse in the current moment during the full throes of the COVID-19 pandemic. As ride demand goes down due to safety restrictions, gig workers are offered no protections to help them navigate the hardships caused by loss of income. In addition to this, people of color, who are already the most socially vulnerable group during this pandemic, constitute a majority of drivers. The result of Prop 22 in such an unprecedented moment is to make vulnerable workers significantly more vulnerable in a time of desperate need. Despite the companies’ claims of wanting to help workers, their actions speak louder than their words.