Why Uber, Lyft's future in California could be decided by voters

The vote on California's Proposition 22 will decide the classification of 'gig workers'

Voters, rather than the courts, could the determine the outcome of the ongoing legal clash between California officials and ride-share leaders Uber and Lyft over the classification of their workers.

Continue Reading Below

California voters will consider a number of ballot measures on the general election date of Nov. 3, including the fate of Proposition 22. Backed by Uber, Lyft, Instacart and other companies active in the “gig economy,” the measure would determine whether workers are classified as independent contractors or full-time employees.

LYFT, UBER RECEIVE EMERGENCY STAY TO RESUME CALIFORNIA OPERATIONS

Proposition 22 would override California’s Assembly Bill 5, a law that required companies like Uber and Lyft to re-classify workers as employees with full benefits such as sick leave. The ride-share companies initially had until Aug. 21 to comply with the law, but an appeals court granted an emergency stay that delayed the mandate until the case can be resolved.

TickerSecurityLastChangeChange %
UBERUBER TECHNOLOGIES INC.37.12+0.06+0.16%
LYFTLYFT INC.30.59-0.65-2.08%

Uber and Lyft had threatened to shut down service to the state of California if an emergency stay was not granted. While hearings on the case are scheduled to take place in October, it is unlikely to be resolved prior to the vote on Prop. 22 on Nov. 3.

UBER OFFERING $24.99 PER MONTH DISCOUNT MEMBERSHIPS

A “yes” vote on Prop. 22 would classify workers as independent contractors, albeit with a requirement that companies provide baseline perks such as a minimum salary and access to health care. Supporters of the measure say it would allow drivers to continue to set their own schedules and keep costs low for consumers.

A “no” vote would effectively establish Assembly Bill 5 as the mandate for companies utilizing independent contractors in the state.

GET FOX BUSINESS ON THE GO BY CLICKING HERE

Uber, Lyft, DoorDash, Postmates and Instacart lobbied heavily in support of Prop. 22’s passage. The companies have spent a combined $110 million to back the measure, according to the Associated Press.

CLICK HERE TO READ MORE ON FOX BUSINESS