Uber and Lyft
Photo by William Jenkins.

New report finds Prop. 22 depresses wages and deepens inequities for California workers 

Findings from a study just made public today reveal that Prop. 22 undermines the pay, benefits, and autonomy of California gig workers, weakening the state’s economy and exacerbating racial inequalities.

Prop. 22, passed in 2020, but being challenged in court, allows companies to classify their app-based rideshare and delivery workers as independent contractors. This also denies them access to employment protections like minimum wage or overtime benefits. 

The study, a collaboration between the National Equity Atlas and Rideshare Drivers United, an advocacy group, used data from 55 rideshare drivers in California between Nov. 1, 2021, and Dec. 12, 2021. The data came through a mobile app dubbed Driver’s Seat Cooperative. 

“Basically, Prop 22 is legalizing sub-minimum wage, it’s creating a second-class workforce,” said Nicole Moore, president of Rideshare Drivers United, at the press conference. “We can’t allow it to continue. The state doesn’t have the data. They can’t see it. This is up to us as drivers, and that’s why we did this big study and 55 drivers gave their data to one big pool.”

“We need the support of lawmakers, regulators and the courts,” she said.

Some of the conclusions:

  • Under Prop. 22, the median net take-home pay per hour for drivers is $6.20; drivers who pay for their own health insurance earn about half that figure.
  • If drivers were classified as employees, they would earn nearly $11 more per hour.
  • Under Prop. 22, rideshare jobs have become less flexible and more controlled by the platforms.

First action under Biden to crack down on exploitation of gig workers

Gig workers are entitled to protection, regardless of their classification, the Federal Trade Commission (FTC) announced Thursday. Their plan to combat gig-worker exploitation marks Biden’s first action on the issue, despite it being a campaign promise. 

“No matter how gig companies choose to classify them, gig workers are consumers entitled to protection under the laws we enforce,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in a statement, according to MarketWatch.

Even so, the platforms are not ready to abandon their insistence on classifying workers as independent contractors. “During today’s meeting, we heard from workers and advocacy groups emphasizing how app-based work provides flexibility and independence that lets millions of people earn additional income on their terms,” said Kristin Sharp, chief executive of Flex Association (a group representing the interest of Uber Lyft, DoorDash, Instacart, etc.), in an email to MarketWatch.

Uber’s internal system was hacked, user data remains intact

On Thursday, Uber discovered that its computer network had been compromised, prompting the firm to shut down a number of its internal communications and engineering systems as it looked into the scope of the attack, according to The New York Times.

According to an updated statement from the company on Monday, no signs of the hacker accessing user data have been found so far.

While the investigation is still underway, the rideshare giant attributes the incident to a hacking group called Lapsus$, which has targeted tech companies such as Microsoft, Cisco, Samsung, Nvidia and Okta over the last year or so. 

Instacart plans to focus its IPO on selling employee shares

Rather than raising money in its initial public offering, Instacart plans to have the majority of its IPO listing come from the sale of employees’ shares, according to The Wall Street Journal

The decision will help Instacart retain talent, allowing it more ways to benefit from its shares. But the company is also further delaying its IPO because it fears it won’t be able to get a good price in the current market, as tech stocks continue to slump

The grocery delivery company’s own dubious performance may also be a factor. Mission Local reported earlier this month that, while Instacart continues to report an increase in orders and revenue in advance of its IPO, its San Francisco workers aren’t experiencing that prosperity. Instead, suffering from a lack of orders, they report that their “sitting time is longer than their working time.”

DoorDash’s new advertising push may be showing the company’s desperation 

DoorDash flier
A DoorDash printed flier. Photo by Lydia Chávez

On Saturday morning, Mission Local spotted a woman handing out DoorDash printed fliers at the 16th Street BART station. The flier states that if you scan a QR code, you’ll get 50 percent off your first DoorDash order of $20 or more, and up to $20 off. The woman told Mission Local that she was hired by a marketing firm, rather than DoorDash. 

This antiquated act may be emblematic of the online food order giant’s desperate desire to rope in new customers. Given that DoorDash’s stock price has plummeted more than 50 percent since the start of this year, we might see more discounts ahead.

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REPORTER. Yujie Zhou is our newest reporter and came on as an intern after graduating from Columbia University's Graduate School of Journalism. She is a full-time staff reporter as part of the Report for America program that helps put young journalists in newsrooms. Before falling in love with the Mission, Yujie covered New York City, studied politics through the “street clashes” in Hong Kong, and earned a wine-tasting certificate in two days. She’s proud to be a bilingual journalist. Follow her on Twitter @Yujie_ZZ.

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  1. Gig apps are in the markete since the the arrival of Uber.It started anticompetitive practic because never clearly declared its legal status rather presented it in disguise of IT company label. The gig apps like doordash, Gruhub driver, shipt and instacart are following the footsteps of Uber. Gig workers has been victim of their malpractices. But no solid steps has been taken by government so far. The gig workers abuse is on going.

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  2. Thank you for writing about this. There is so much they put us through. If my boyfriend wasn’t there as my witness for a lot of the stuff they pull, I would have thought I was going nuts.

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  3. Most of these gig companies are not even good examples of capitalism. Uber has lost 32 billion dollars since its inception. That is totally ludicrous. That’s a pretty big scam since we know the early investors got out with there money and sold a dream to public investors during the IPO process. The damage that these companies have done to multiple industries and labor rights will take years to recover from.

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    1. Uber could only have panned out if they had been successful in squeezing out the previous monopolies (regulated taxi operators) and become the next monopoly operator. Too bad (/s): Lyft’s grown big enough to depress Uber’s profitability into endless quarterly losses.

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