London Daily

Focus on the big picture.
Friday, Jun 20, 2025

Uber and Lyft expected to prevail in California ballot measure exempting them from state labor law

Uber and Lyft expected to prevail in California ballot measure exempting them from state labor law

The proposition would allow drivers for app-based transportation and delivery companies to be classified as independent contractors in many circumstances.

California voters decided Tuesday that Uber and Lyft should be exempt from state labor law that aimed to make their drivers employees rather than contractors, according to projections from NBC News.

Voters made the call on California’s Proposition 22, a ballot measure that essentially became one of Uber and Lyft’s last hopes in the state to continue their operations under the status quo.

The proposition would allow drivers for app-based transportation and delivery companies to be classified as independent contractors in many circumstances. While that would disqualify them for benefits granted to employees, the measure also entitles drivers to new benefits like minimum earnings and vehicle insurance.

Several gig economy apps backed the measure, including Uber, Lyft, DoorDash, Instacart and Postmates, which Uber is acquiring. The support from these companies helped raise nearly $203 million to back the measure, while opponents raised less than $20 million, according to tallies compiled by Ballotpedia.

Democratic presidential nominee Joe Biden opposed the measure. Biden tweeted in May that Californians should vote no on the initiative and said, “gig economy giants are trying to gut the law and exempt their workers. It’s unacceptable.”


While Uber and Lyft were able to raise gobs of cash from venture capitalists while private and have multi-billion dollar valuations on the public market, neither has reached profitability. That makes the contractor-driver model especially important to the businesses, allowing them to avoid costly benefits associated with employment, such as unemployment insurance.

The companies have warned they’d likely have to pass on increased costs of worker reclassification to consumers. Uber estimated in a blog post earlier this year that it would have to raise rider prices between 25 percent and 111 percent in parts of California to cover the costs.

The New York Times reported in August that both companies were considering a fleet-like model, similar to traditional taxis. Under that model, the companies would license their brands to operators like a franchise, according to the Times.

The proposition has significant implications for DoorDash and Instacart as well, both of which are reportedly preparing to go public. Like Uber and Lyft, these companies also rely heavily on gig workers for their delivery services. Without the passage of Proposition 22, the companies would likely worry about potentially larger expenses to hire workers as employees.

Critics like Rep. Ro Khanna, D-Calif., have said that there’s nothing written into current labor law stopping Uber and Lyft from providing flexibility to drivers while classifying them as employees. The companies have countered that the logistics of such a model would be untenable since it would be too difficult to track time worked.

The companies faced a setback in August when a trial judge granted a preliminary injunction forcing them to reclassify their drivers as employees, although that ruling has yet to go into effect as the case makes its way through the legal process. The lawsuit’s fate is unclear now that the ballot measure has passed.

Representatives from Uber, Lyft and the California attorney general’s office did not immediately respond to requests for comment

Newsletter

Related Articles

0:00
0:00
Close
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
Iranian Military Officers Reportedly Seek Contact with Reza Pahlavi, Signal Intent to Defect
FBI and Senate Investigate Allegations of Chinese Plot to Influence the 2020 Election in Biden’s Favor Using Fake U.S. Driver’s Licenses
Vietnam Emerges as Luxury Yacht Destination for Ultra‑Rich
Plans to Sell Dutch Embassy in Bangkok Face Local Opposition
China's Iranian Oil Imports Face Disruption Amid Escalating Middle East Tensions
Trump's $5 Million 'Trump Card' Visa Program Draws Nearly 70,000 Applicants
DGCA Finds No Major Safety Concerns in Air India's Boeing 787 Fleet
Airlines Reroute Flights Amid Expanding Middle East Conflict Zones
Elon Musk's xAI Seeks $9.3 Billion in Funding Amid AI Expansion
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Israeli Airstrike Targets Iranian State TV in Central Tehran
President Trump is leaving the G7 summit early and has ordered the National Security Council to the Situation Room
Taiwan Imposes Export Ban on Chips to Huawei and SMIC
Israel has just announced plans to strike Tehran again, and in response, Trump has urged people to evacuate
Netanyahu Signals Potential Regime Change in Iran
Juncker Criticizes EU Inaction on Trump Tariffs
EU Proposes Ban on New Russian Gas Contracts
Analysts Warn Iran May Resort to Unconventional Warfare
Iranian Regime Faces Existential Threat Amid Conflict
Energy Infrastructure Becomes War Zone in Middle East
UK Home Secretary Apologizes Over Child Grooming Failures
Trump Organization Launches 5G Mobile Network and Golden Handset
Towcester Hosts 2025 English Greyhound Derby Amid Industry Scrutiny
Gary Oldman and David Beckham Knighted in King's Birthday Honours
Over 30,000 Lightning Strikes Recorded Across UK During Overnight Storms
Princess of Wales Returns to Public Duties at Trooping the Colour
Red Arrows Use Sustainable Fuel in Historic Trooping the Colour Flypast
Former Welsh First Minister Addresses Unionist Concerns Over Irish Language
Iran Signals Openness to Nuclear Negotiations Amid Ongoing Regional Tensions
France Bars Israeli Arms Companies from Paris Defense Expo
King Charles Leads Tribute to Air India Crash Victims at Trooping the Colour
Jack Pitchford Embarks on 200-Mile Walk to Support Stem Cell Charity
Surrey Hikers Take on Challenge of Climbing 11 Peaks in a Single Day
UK Deploys RAF Jets to Middle East Amid Israel-Iran Tensions
Two Skydivers Die in 'Tragic Accident' at Devon Airfield
Sainsbury's and Morrisons Accused of Displaying Prohibited Tobacco Ads
UK Launches National Inquiry into Grooming Gangs
Families Seek Closure After Air India Crash
Gold Emerges as Global Safe Haven Amid Uncertainty
Trump Reports $57 Million Earnings from Crypto Venture
Trump's Military Parade Sparks Concerns Over Authoritarianism
Nationwide 'No Kings' Protests Challenge Trump's Leadership
UK Deploys Jets to Middle East Amid Rising Tensions
Trump's Anti-War Stance Tested Amid Israel-Iran Conflict
Germany Holds First Veterans Celebration Since WWII
U.S. Health Secretary Dismisses CDC Vaccine Advisory Committee
Minnesota Lawmaker Melissa Hortman and Husband Killed in Targeted Attack; Senator John Hoffman and Wife Injured
Exiled Iranian Prince Reza Pahlavi Urges Overthrow of Khamenei Regime
×