Uber, Lyft, DoorDash, Instacart, and Postmates spent over $200 million campaigning for Proposition 22, the most expensive ballot measure in California history, successfully convincing voters that they couldn’t properly pay and protect their workers if they were forced to classify them as full employees — at least, not without cutting back service or substantially raising the price you’d pay.
But now the dust has settled, every single gig economy company that backed Prop 22 has raised those prices anyway. Instacart was the last to join the bait-and-switch today, according to the San Francisco Chronicle’s Carolyn Said, who previously told us in January exactly how much some of these companies are charging Californians to pay for worker benefits: $1-$2 per meal with Uber, $1.50 with Grubhub, up to $1.50 per ride with Lyft, and a whole additional 3 percent increase per order with Instacart (for a total of 8 percent, though it doesn’t apply to the company’s “Express” subscription plan yet). Postmates is charging as much as $2.50 extra per order, our sister site Eater reported.
Just to be clear, these companies explicitly pushed voters into supporting Prop 22 to avoid higher prices. Uber CEO Dara Khosrowshahi publicly said prices would increase between 20 and 40 percent in big California cities like San Francisco and Los Angeles, and up to double in smaller towns. In California’s official Voter Guide, which accompanied mail-in ballots, supporters of the bill warned there would be “significantly higher consumer prices” if Prop 22 failed to pass.
Companies like Uber and Lyft succeeded in part due to those scare tactics, and by appealing to voters that they could help workers get more protections and higher pay this way instead of potentially putting those workers’ jobs at risk. (It probably didn’t hurt that the app companies bombarded both drivers and passengers with messages using their own apps, which triggered a lawsuit from drivers who claimed Uber was bullying them.)
But there’s still an open question whether Prop 22 is actually helping workers, regardless of how much more we’re paying to supposedly make that happen. The Guardian reported yesterday that some drivers claim pay has actually fallen and the job has become less reliable.
In the UK, Uber just lost a five-year legal battle today over a similar issue, which will give workers there a guaranteed minimum wage, paid holiday, and other protections (though they will not necessarily be “employees”). But here in the US where Prop 22 succeeded, it’s opened the door for other parts of the country to potentially replace many regular employees with contractors too. Bloomberg has a good piece you should read about what that future might look like, for better or for worse.