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Uber’s New Gig Economy Model Could Expand to Other States

Published on Nov 5, 2020 at 9:34 am in News.

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Following the vote for Proposition 22 in California on Tuesday, legal experts and labor organizers across the country are closely watching how other states might embrace similar ballot measures. This is especially the case in Western states.

The question of worker classification is established at the state level. According to NBC News, New York, New Jersey, Connecticut, Washington, Oregon, and Illinois have already introduced similar legislation.

Labor unions around the country are preparing to take on the new gig economy model in hopes they can prevent it from spreading. The organized groups are against Proposition 22 because companies like Uber and Lyft don’t have to pay for insurance or unemployment benefits.

The question, however, is whether the unions can afford the costly campaigns. Uber, Lyft, DoorDash, and Postmates spent more than $200 million to help pass the proposition. That’s considerably more than what labor union who organized opposition to the bill spent.

According to Lena Simet, a researcher at Human Rights Watch, “I think there was a lot of attention paid to the process in California, and perhaps through the ways in which gig companies presented some of the issues, I think it affected the voters’ decisions in ways that were very hard to anticipate. Now that we know the result, I think it helps to think through from workers groups to make sure that there is an understanding that we are not asking for the sky. We are asking for very basic protections.”

While neither Uber nor Lyft has responded to questions about the passing of Proposition 22, it’s clear the companies would prefer a nationwide standard. At this point, the new California law would be extremely difficult to change or eradicate. It would require a seventh-eighths vote in the Legislature, which would be challenging even under a unified Democratically controlled state Senate and Assembly.

What could impact the passing of Proposition 22 is the presidential election. Depending on the election results, the federal landscape could alter in a way that benefits gig workers and puts more pressure on companies.

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