The gig economy is on the ballot
Prop 22 is shaping up to be California's most expensive ballot question ever, and its outcome could upend a gig economy business model that's attracted hundreds of billions of investment dollars.
The state of play: Prop 22, supported by such companies as DoorDash and Uber, is favored in most recent polling. But it's no sure bet, due to a large chunk of still undecided voters.
If it passes: Gig economy companies would be able to continue classifying delivery workers and ride-hail drivers as contractors, while providing some new benefits like minimum earnings, health care subsidies, and vehicle insurance.
If it fails: Gig economy companies could be required to abide by a California law that effectively would cause them to treat such workers as employees. Several of the companies have argued that the law doesn't apply to them, but nonetheless have plugged huge money into Prop 22 — which could help head those legal fights off at the pass.
- A recent UC Berkeley poll gives Prop 22 a 39-36 edge among likely voters, with 25% undecided.
- A recent San Diego Union-Tribune/10News poll shows 45% in favor, 31% opposed, and 25% undecided.
Prop 22 is a state issue, but what happens in California could inspire similar ballot measures elsewhere, or even federal action.
- Both Joe Biden and Kamala Harris have previously expressed support the California law that Prop 22 seeks to modify, and House Democrats passed a bill with similar language.
Gig economy companies are spending huge on Prop 22.
- Through Sept. 23, "Yes on Proposition 22" had received $184.3 million. Backers include Uber ($50M), Lyft ($48M), DoorDash ($47M), InstaCart ($28M), and Postmates ($11M).
- "No on Prop 22" received just $10.7 million, mostly from labor unions.
- Some gig economy companies also have been showing in-app ads to drivers and customers about the ballot measures — something the companies argue is informative, while critics argue is intrusive.
The bottom line: This remains a very close ballot battle, particularly in light of the dollar differential.