On Nov. 3rd, California voters will decide whether or not app-based rideshare and delivery drivers will be defined as independent contractors or as employees.
Proposition 22 focuses on repealing Assembly Bill 5 which amended and added clauses to the state’s labor codes to more properly define who is considered an independent contractor or an employee of a company.
AB- 5 was proposed after a series of court cases came to light.
In 2018, the court case, Dynamex Operations West, Inc. v. Superior Court of Los Angeles, established company workers as employees and implemented a 3-part test to indicate if a worker should be classified as an independent contractor.
According to California’s Employment Development Department, the test specifies that a person must be free of the hiring entity’s control, the work must be performed outside the business' usual procedures and must be involved in an independently established trade.
If Proposition 22 does not pass, AB 5 will stand and companies like Uber, Lyft and Doordash must change the status of drivers from independent contractors to employees and would have to provide them with standard benefits like minimum wage, healthcare, sick leave and unemployment. The companies would also have to provide a set schedule for when the drivers are allowed to work.
If the measure passes drivers will maintain their status as independent contractors while enacting labor and wage policies specific to this line of work. The policies could include a requirement for companies to provide 41% healthcare coverage for drivers who work an average of 15 to 25 hours per week.
According to a CA App-Based Driver Survey, 68% of all California app-based drivers would stop driving if they lost their flexible schedule. The survey also reported that 84% of the drivers said that they have another job and 72% support Proposition 22.
Uber economist Alison Stein said that with the loss of drivers, rider prices would increase from 25% to 111% across California to cover the costs of making the drivers employees. In the Orange County market, prices would see a rise by 50-60%.
Cal State Fullerton senior Benjamin Brazeal said in a telephone interview that the rising prices may stop him from calling a ride.
“I wouldn’t want to pay a lot of money just to be getting to the location I want,” Brazeal said. “At that point, I’d just end up driving.”
The campaign “No on Prop 22” suggests that the ballot measure causes more harm to drivers as it will weaken the benefits and protections drivers are entitled to because it will not offer overtime or paid leave. The coalition also states that the newly added benefits in AB 5 offer greater accessibility to state and federal programs like unemployment and healthcare.
Over $188 million have been raised in support of “Yes on 22” and their opposition have spent over $15 million according to the California Secretary of State’s website.