What is California Proposition 22 and a Gig Economy

Who won the election? No, I don’t want to talk about the presidential election, I want to talk about who won California Proposition 22. This is a proposition that would allow companies like Uber, DoorDash, and other companies that provide door to door service via a gig economy to treat their drivers, freelancers, 1099 workers, or their employees, as traditional W-2 employees. This could have consequences in the state of California because these companies like Uber would have more employees on the books which would require a ground health plan, overtime compensation, among other things. Proposition 22 was one of the most expensive propositions in recent history in California. Over $200 million were raised in order to support marketing, advertising, and lobbying for the proposition. Now, it seems like the proposition has passed. 

 

What does this mean for us as consumers? It may mean that our fares are the same because if it was the other way around and the companies had to classify their workers as employees, then the fares would go up. What this also means is that this could be used for precedence for how other states could treat it. Not a legal precedence, but practical precedence. In other states who want to implement drivers like Uber drivers to be gig workers or employees of the company, the verdict is out in California that the people, in general, do not like that. So a free economy has its price and the price seems to be determined by the taxi meter.