California Voted for Cheaper Uber Rides. It May Have Hurt Drivers

In 2020, California voters approved a law that would improve worker conditions while keeping ride and delivery services cheap and abundant for consumers. According to a report published today, rideshare drivers in the state have seen their effective hourly wage decline compared to what it would have been if the law hadn't taken effect.

Rideshare drivers in California make an hourly wage of $6.20 after paying for things like gas and vehicle wear and tear, according to a study by Policylink and Rideshare Drivers United. If drivers were made employees, they could make more money.

Vitali Konstantinov is a member of Rideshare Drivers United and he says that driving has become more difficult since the passage of Prop 22. The companies can change our terms at any time, even though we are called independent contractors. There needs to be labor rights for app-deployed workers.

According to the company's own data, tens of thousands of California drivers earned $30 per hour on the dates studied by the research team. The report was "untethered to the experience of drivers in California," according to Shadawn Reddick- Smith.

California consumers and workers were able to have their cake and eat it, too, as a result of Prop 22. At the time, a new state law aimed at the gig economy sought to transform app-based workers from independent contractors into employees with all the workers' rights attached to that status. The law was based on the idea that companies had too much control over workers and their wages to be considered independent contractors.

The change would have cost the Big Gig companies hundreds of millions of dollars a year. The companies argued that if drivers were treated as employees, they would lose the ability to set their own schedules, and that rides would become more expensive. In an effort to carve out an exemption for workers driving and delivering on app-based platforms, a group of companies launched Prop 22.

Ridesharing drivers are still independent contractors under the provisions of Prop 22. They receive a guaranteed rate of 30 cents per mile, and at least 120 percent of the local minimum wage, not including time and miles driven between rides as drivers wait for their next fares, which the company says accounts for 30 percent of drivers' miles while on the app. According to PolicyLink, just 10 percent of California drivers have used the health care subsidy because they don't work enough hours to qualify, but that's because they don't work enough hours.