After a two-year legal battle in California, ride- hailing giants Uber Technologies Inc. and Lyft Inc., along with other major gig-economy players in the state, will not be forced to reclassify their drivers as employees. But this does not mean that the fight is over.
Some expect drivers to continue to advocate for further rights and benefits from these companies. Others anticipate that last week’s passage of Proposition 22 could open doors for other companies to lobby for initiatives, as Uber and Lyft did, in other states that are weighing gig labor laws.
The ballot measure — which Uber, Lyft, DoorDash and others bankrolled with more than $200 million — allows the companies to continue to classify their drivers as contract workers. The companies have argued that this model provides workers with flexible hours and independence.
The legal battle between Uber and Lyft and California ensued when the state this year implemented Assembly Bill 5, a labor law passed in September 2019. The law aimed to reclassify workers for ride-hail, food delivery and other app-based gig economy companies. Uber and Lyft went into defense mode, warning that the measure would obliterate their operations.
If drivers in California had been granted employee status on Election Day, Uber and Lyft might not have been viable going forward, said Bryant Greening, attorney at LegalRideshare, a personal injury law firm in Chicago.
“This was really a life-or-death moment for them,” Greening told Automotive News. “Their livelihood depended on AB5 being stricken and something much more favorable like Prop 22 taking its place.”
But now, it is difficult to know what the vote might mean moving forward, said Tia Koonse, legal and policy research manager at the UCLA Labor Center.
“The overall battle to improve the working conditions is not over,” Koonse said. “Drivers and delivery workers will continue to fight to improve the conditions that make their work so precarious.
“Even the companies knew they had to provide concessions to drivers in the end for better working conditions,” she added. “That’s why I think that the conversation is not over.”
