Personal Injury Firm
Gig-economy apps, including food delivery companies, have dropped $70 million more into their campaign to support a California ballot measure that would keep their workers as independent contractors. The total funds for Yes on 22 is currently at $181 million, making it one of the biggest-ticket California initiatives ever.
According to Ballotpedia, Prop 22 is the most expensive ballot measure California has seen since 1999, when they started keeping track. DoorDash and Instacart have each poured an additional $17.5 million into Proposition 22. DoorDash had already dropped $30 million on the campaign, and Instacart $10M, as has Postmates. Uber and Lyft have also put in about $47.5 million each.
On the other hand, the opposition, the No on 22 campaign is funded by organized labor and has raised a modest $4.8 million.
David McCuan, a professor of political science at Sonoma State University who studies
California ballot measures, told the San Francisco Chronicle that the gig companies see the issue as crucial to their future so it’s not surprising that they’re willing to throw so much money at it: “It is a pay-to-play scheme in terms of how ballot politics work.”
The aforementioned companies want to avoid having to reclassify its workers as employees, saying it would kill the flexibility of their businesses. Prop 22 would permanently keep drivers and couriers as independent contractors, while entitling them to some wage guarantees and benefits.
The food delivery companies’ strong support comes at the heels of California suing Uber and Lyft for not enforcing AB5, the state law that has been in effect since the start of the year requiring the ridesharing companies to classify workers as employees and offer the full scope of employment benefits and protections, arguing that they are not transportation businesses, but simply tech platforms. The companies kept fighting in court, and even threatened to pull out of California, but ultimately obtained a temporary reprieve from an appeals court that allowed them to keep operating while they restructured their business models.
The food delivery apps have evaded AB5 so far, but they’re expected to be next — hence why they’re pouring millions into passing Prop 22. The Yes on 22 campaign maintains that the measure would actually protect hundreds of thousands of jobs.
A spokesman for No on Prop. 22, Mike Roth, reportedly told the San Francisco Chronicle: “Quite an irony the app companies picked Labor Day (weekend) to dump $70 million more into their campaign for a special exemption from the law to deny their drivers benefits like unemployment insurance and paid sick time in a pandemic.”
Uber and Lyft, as well as the food delivery apps, have long considered their drivers to be contractors, meaning that drivers are responsible for their own vehicle and maintenance costs. Because of this, the companies currently do not pay for any benefits such as overtime, paid sick leave, unemployment insurance, medical insurance, or any other expenses. Because of AB5 and their advocacy for the passage of Prop 22, the companies are now announcing they’d start offering some benefits to their workers.
