Gig Battles Brew In California Regardless Of Uber, Lyft Prop 22 Victory

Uber and Lyft claimed victory in California on Election Day when Proposition 22 was upheld by voters, but despite the win, battles are still brewing over how gig workers should be classified, according to a report from The New York Times.

The ballot measure was supported by 58 percent of California voters, overriding Assembly Bill 5 (AB 5), which was passed in September 2019. The new mandate essentially excludes app-driven companies like Uber and Lyft from the state law that redefines gig workers as employees.

“Going forward, you’ll see us more loudly advocate for new laws like Prop 22,” Uber CEO Dara Khosrowshahi said in reaction to the vote.

News of the vote also triggered a surge in stock value for both companies, up about $20 billion in the week following the election, the Times reported.

Regardless of the California win, gig worker status is still being debated in other states across the country as well as among labor unions. Additionally, various groups are looking for holes in the measure that could be used for a court challenge, according to the report.

“A lot of smart lawyers are looking at it,” Brian Chen, a lawyer at the National Employment Law Project (NELP), told the Times.

NELP, an advocacy group for low income earners, has been probing the measure’s constitutionality and sharing data with other unconventional factions. Some of the other groups could take the matter to court, the report stated.

Chen said the measure includes verbiage that any changes to the legislation would have to pass with a seven-eighths majority — something that could be in a grey legal area, the Times reported.

Uber and Lyft are also embroiled in three lawsuits — one brought by the state attorney general and three city attorneys in May, and another two brought by the state’s labor commissioner.

Last month, Khosrowshahi called AB 5 irrational and unconstitutional. The California Court of Appeals, however, ruled Oct. 23 that Uber and Lyft must abide by the law and reclassify their gig workers as state employees, pending the voters' decision on Nov. 3.

In response, Uber and Lyft bankrolled Proposition 22.