California's Proposition 22 exempted some major tech firms from fully complying with labor laws. In November, California voters passed Prop 22, with 58.63% of voters in favor of the amendment to exempt app-based gig workers from California assembly bill 5, which granted gig workers the rights of employees such as unemployment insurance, health insurance, minimum wage, and collective bargaining. Uber, Lyft, and other gig companies refused to comply with AB5 and threatened to shut down operations in the state of California if they were forced to do so. Prop 22, authored by Uber, Lyft, Instacart, and DoorDash, went into effect in mid-December 2020 after an aggressive public relations campaign of more than $200m launched by the companies. The companies out-spent opponents to Prop 22 by 10 to one, making it the most expensive ballot measure in California’s history.
“It’s clear that as soon as Prop 22 passed, it was open season to start cutting my pay again,” said Peter Young, a rideshare driver for four years in Los Angeles. “If you try to earn money, just purely on the delivery fee, it comes out to about $5 an hour. A good day for me is maybe earning $100 before gas and expenses off eight hours of work,” said Young.
Ben Valdez has worked part-time as an Uber driver in Los Angeles for five years.
“I was under the impression that I was going to get an additional $0.30 per mile after Prop 22,” said Valdez, but he hasn’t received that extra compensation. "A lot of drivers were duped because they expected they were magically going to be able to qualify for benefits that the companies made it sound like they were going to pay for up front and that drivers were going to be getting reimbursement for the mileage,” said Valdez. “They also made drivers believe that if Prop 22 didn’t pass then Uber and Lyft were going to leave the state of California because they couldn’t afford to pay drivers as employees.”
“Prop 22 hasn’t made anything better because the companies still don’t take into consideration the waiting time and driving time to stores, so their guaranteed 120 percent of minimum wage is fraudulent,” said Okawa. She pays about $180 a week to rent a car through Uber’s partnership with Avis and spends about $90 on gas a week. She works five to six days a week from 7.30am to 6pm. She claimed the gig companies had changed base pay without giving a reason.
A study by labor economists at the University of California, Berkeley, in October 2019 found Prop 22 guarantees a minimum wage of $5.64 an hour, as only engaged time is accounted for in the wage calculations. The minimum wage in California is $14 an hour as of January 2021, and $13 an hour for employers with less than 25 employees.
Several gig apps announced fees for customers in California would increase to cover the costs of Prop 22 driver benefits after several of the apps used fear of prices increases if Prop 22 didn’t pass.