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A group of California Uber and Lyft drivers filed a lawsuit in the state supreme court to overturn Prop 22, the ballot measure that allows the gig economy app companies to continue classifying its workers as independent contractors instead of employees.
Approved by California voters last November, the drivers claim that Prop 22 violates the state’s constitution by “stripping” the state legislature’s ability to empower workers to organize, as well as by “illegally” excluding ride-hail drivers from the state workers’ compensation program. The drivers challenging the constitutionality of Prop 22 are being supported by labor unions like the California Labor Federation.
Companies including Uber, Lyft, and DoorDash collectively spent over $200 million into the “Yes on 22” campaign to exempt them from California’s AB5, which required them to treat their workers like employees, including providing benefits like health insurance and sick time. The companies aggressively opposed the law, arguing it would eliminate driver flexibility, while also increasing consumer prices and wait times.
In a statement quoted by The Verge, one of the plaintiffs, Saori Okawa, said: “Every day, rideshare drivers like me struggle to make ends meet because companies like Uber and Lyft prioritize corporate profits over our wellbeing. With Prop 22, they’re not just ignoring our health and safety — they’re discarding our state’s constitution.”
The gig economy companies promised to provide some benefits to its drivers if they got to keep them classified as independent contractors. Had Prop 22 failed, many companies threatened to pull out from California. However, Uber and Doordash increased their prices in the state in order to pay for all the promised benefits. The ridesharing company said the cost to customers will vary depending on the city and type of service. For example, each food delivery bill in Los Angeles increased by 99 cents, the surcharge for rides is 75 cents. In San Francisco, it’s an additional $2 for food delivery and 30 cents for rides. Prices go as high as $1.50 in less populated areas in the state.
As The Verge noted that AB5, “represented an existential crisis for the companies, none of which have ever turned a profit and which have pursued costly efforts to develop autonomous technology in the hopes of eventually replacing drivers and delivery workers entirely.”
While unclear how successful drivers will be in overturning Prop 22, they are trying to use this language to argue that the ballot measure was illegal from its inception. The measure was written in a way to withstand future challenges, including a provision that requires a seven-eighths majority of the state legislature for any modification — ensuring that it will be all but impossible to invalidate. The plaintiffs note that California’s state constitution gives the legislature “unlimited” authority to provide for a worker’s compensation system, “so that authority cannot be limited by a statutory initiative.”
Bob Schoonover, president of the labor union SEIU Local 721 and SEIU California State Council, in a statement quoted by The Verge: “We look forward to the court affirming that gig companies cannot strip workers of their fundamental right to bargain for better pay and working conditions — and that corporations alone should not dictate the laws in our state.”
Drivers are reportedly organizing car caravans in Los Angeles and San Francisco in support of the lawsuit against Prop 22.