Uber and Lyft drivers use their own vehicles and are paid by the ride, giving rise to the term “gig economy.”
Uber and Lyft contend that they give drivers opportunities to voluntarily supplement their incomes by working whenever it suits them. But, this business model has is unsettled unions and many in government, who contend that it deprives workers of rights and benefits of being on the payroll, such as contributions for Social Security and Medicare benefits and overtime pay. As independent contractors, gig workers also cannot be union members.
Two years ago, the state Supreme Court declared gig work illegal, and the Legislature followed up with measure, Assembly Bill 5, which put the decision into law. Uber and Lyft, responded with a ballot measure, #22 on Nov 3, 2020 ballot, that would exempt them from the Assembly Bill 5 legislation while offering gig workers some employee-lite benefits.
Voters will decide whether gig work is an appropriate new model or an illegal denial of worker rights and counter to state labor law, when they vote on Prop 22 in November.
The Pro Proposistion 22 coalition is comprised of companies employing gig workers, and the anti-Proposition 22 coalition is comprised of unions and many in government. Attorney General Becerra and some city attorneys have now also sued Uber and Lyft for continuing to classify their drivers as independent contractors despite the passage of AB 5.
Recently , San Francisco Superior Court Judge Ethan Schulman ruled against the companies. Judge Schulman said the companies’ employment practices are depriving drivers “of the panoply of basic rights to which employees are entitled under California law.”