Uber, Lyft win in California as state votes to keep drivers classified as independent contractors

The ballot initiative was one of the costliest in the state’s history

Californians have voted "yes" on a ballot measure to exempt gig workers from state labor laws, according to Associated Press election calls.

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TickerSecurityLastChangeChange %
UBERUBER TECHNOLOGIES INC.49.66-1.06-2.09%
LYFTLYFT INC.38.17-0.87-2.23%

Shares of Uber and Lyft jumped on the news.

Proposition 22 asked voters whether Uber, Lyft, and other app-based drivers should remain independent contractors or be eligible for the benefits that come with being company employees.

A rideshare car displays Lyft and Uber stickers on its front windshield in downtown Los Angeles. 

The run-up to Election Day yielded a slew of lawsuits and advertisements over the ballot initiative, making it one of the costliest in the state’s history. Gig companies outspent labor groups by about $200 million to $19 million.

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Had the measure failed, gig companies would have been compelled to reclassify and pay contract workers like employees. Treating them as such would have guaranteed benefits such as overtime, sick leave, and expense reimbursement for workers who make up much of the gig economy.

Companies like Uber, Lyft, and DoorDash heavily bankrolled the “Yes on Prop. 22” campaign by spending money on TV and digital advertising as well as hiring consultants, lobbyists, and PR firms.

Opponents had argued that small businesses are required to provide a safety net for their workers and gig companies should be no exception.

Uber and Lyft – which have more than 400,000 drivers in California – said they would have been forced to cut the number of workers and raise prices for riders if the measure failed.

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Still, the measure was widely expected to pass.