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In order to appeal to voters, the gig economy apps, like the food delivery company Doordash and ridehailing giants Uber and Lyft, said the labor law exemptions tied to the passage of Prop. 22 would create better opportunities for its drivers, especially those of color. Instead, a new research paper reportedly argues that it “legalized racial subordination.”
Last year, the aforementioned companies together with Instacart and Uber-owned Postmates spent a record $203 million to convince California voters to pass Prop. 22 and succeeded. The ballot measure in turn allowed them to avoid paying for new benefits the state had recently extended to their workers with AB5. Instead of recognizing the workers as full fledged employees, the companies were able to keep classifying them as independent contractors.
The companies reportedly said Prop. 22 would be helpful for workers of color and immigrants, who make up the vast majority of their drivers and delivery couriers. But now, an upcoming research paper by UC Hastings law professor and gig economy expert Veena Dubal argues that – despite the companies’ promises that Prop. 22 would help achieve racial and economic justice for their workers — the law actually has had the direct opposite effect.
As Dubal reportedly wrote, the new category of workers created by Prop. 22 “is best understood as a new form of legalized racial subordination — lower wages and benefits for a people of color and immigrant workforce.”
Ride-hailing and food-delivery companies claimed that classifying workers as independent contractors offered them the independence of being a contractor and some of the benefits that come with being an employee. They also said their workers didn’t want to be employees, given that they liked having liberties like setting their own hours. But according to Dubal, such proposals actually look strikingly like discriminatory “wage codes” passed in the 1930’s at the request of racist industrialists and plantation owners.
The laws, though not explicitly racist, their effects indeed were. As explained by Business Insider, by exempting employers with mostly Black workforces, wage codes denied those workers minimum wage, workers’ compensation, unemployment insurance, and unionization rights that workers in majority white industries had.
Dubal argues that Prop 22 is a recycled version of those racialized wage codes, but that this time around, companies used social justice arguments to persuade people it would have the opposite result.
To garner support for Prop 22 in California, the Yes on 22 campaign reportedly touted endorsements from civil rights groups, including NAACP California, and sent mailers to voters implying that progressives like Sen. Bernie Sanders supported the ballot measure. Sen. Sanders and other progressives denounced the both mailers and Prop. 22, and the head of the California NAACP chapter stepped down amid revelations that the Yes on 22 paid her consulting firm $95,000.
Dubal also argues that the bigger hypocrisy is that the companies were “highlighting particular forms of racial subjugation, while ignoring and profiting from others” — namely, the racial subjugation of their own workers.
Based on Dubal’s research, Business Insider noted the history of the first federal minimum wage law, social security benefits, and union rights in a major win for workers, established during the Great Depression, and how industrialists and plantation owners’ “racist demands” led Congress to exclude agricultural and domestic workers. These workers were mostly Black, subjecting them to separate and unequal workplace conditions. Those exemptions reportedly let companies pay primarily Black workforces 20% to 40% less than the minimum wage.
For Dubal, Prop. 22 isn’t much different. But this time, companies are masking their arguments in racial justice arguments and confusing legalese rather than openly racist terms. She argues that Prop. 22 provides far less than what those workers should already have been receiving as employees under AB5.
As Dubal wrote, with Prop. 22 Uber, Lyft, DoorDash, Instacart, and Postmates ultimately “obscured the way in which the law created a new racial wage code, claiming instead to offer economic opportunities for people of color and concealing the exploitative conditions endemic to those ‘opportunities.'”