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Gig Companies Win the Prop 22 Battle, But the Nationwide Fight Continues

 

Readers will recall that California’s Prop 22, passed earlier this month, saw California voters approving a ballot measure to exclude gig companies from the reach of AB 5.  That means in California, gig workers for companies like Uber, Lyft, Instacart, Door Dash, etc. do not fall within the scope of AB 5 and therefore are classified as independent contractors rather than employees. As a result, with these gig workers not being classified as employees, they are not eligible for a minimum wage rate, overtime pay, unemployment, etc.

As I had noted following the vote, this was a major victory for gig companies.  However, that victory might be short lived.  Even with the passage of Prop 22, gig companies are not out of the woods yet.  For starters, pro worker groups are looking for ways to challenge the outcome of Prop 22 in court.  Whether those challenges prove successful is too early to know but it could tie up Prop 22 for months or years to come.  And of course, let us not forget a host of litigation that has been brought against Uber & Lyft by several states.

On top of that, there is a patch work of application of the employee vs. independent contractor status across the country.  Some states such as New York, Illinois, and New Jersey have found some gig workers must be considered employees for unemployment insurance purposes.  In at least one state, New York, there have been suggestions that a compromise could be made with gig companies rather than engage in a prolonged fight.

Of course, do not forget that with a new administration taking office in January, it is certainly possible (if not probable) that this new administration will rally around workers.  That could lead to employee friendly appointees at eh Labor Department, Equal Employment Opportunity Commission, and National Labor Relations Board.  Those appointees could shape the policy of these agencies by issuing worker friendly guidance, issuing decisions that favor employee status for gig workers, and issuing pro-gig worker opinion letters, among other steps.

If I were a gig company, I would certainly be pleased with the outcome of Prop 22...but also be turning my eye down the road for the fight ahead.


For additional information:  https://www.nytimes.com/2020/11/11/business/economy/california-gig-workers-ballot-uber-lyft.html

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