Californians vote on future of gig workers

Californians aren’t just flocking to the polls to cast their ballots for the presidency and Congress. The trend-setting state is voting on the future of the gig economy.

They’ll decide whether to back Proposition 22. The ballot proposal by Uber and its allies like Lyft and Doordash would cement the status of app-based ride-hail and food delivery drivers as independent contractors, not employees. The initiative would overturn a state law that would force the companies to classify drivers as employees.

The companies say that law doesn’t apply because they are technology platforms, not hiring entities. And they contend a new generation of workers want to choose when and how they work. They say their surveys show more than 70% of current gig workers don’t want to be employees.

But labor groups question those polls. Opponents say the companies are trying to exploit workers and avoid paying employee-related costs. A Reuters calculation found that those expenses could amount to roughly $400 million each for Uber and Lyft in annual payroll taxes and workers’ compensation costs.

Californians are split on the issue. 46% of voters in a poll published last week by UC Berkeley said they would vote in favor of the ballot measure; 42% were against it. The remainder was undecided. If Proposition 22 is rejected, some of the companies backing the initiative say they’ll shut down in California.

Shares of Uber and Lyft rose in early trading Tuesday.