It’s been a tough few weeks for gig economy workers, who were already at the bottom of the economic totem pole:
- A few weeks ago, the grocery store chain Albertson’s announced that it was laying off its unionized delivery workers and instead contracting with low-paid Instacart drivers to do app-based shopping for customers.
- A week later, Instacart fired any and all employees that were trying to unionize.
- DoorDash and Uber Eats just quietly instituted new fees on customers in some cities to get around caps placed to protect consumers in other cities.
Unlike many overt abuses of corporate power, these are not fait accompli. In fact, President Joe Biden can actually do something about them. He just has to empower his National Labor Relations Board to take action on Prop 22, one of the biggest under-the-radar threats to working people and democracy today.
What Is Prop 22?
Two events fundamentally rewired the American economy last year. The first, obviously, was COVID-19, which continues to rage and roil what was an already grossly unequal system. The second, the passage of Proposition 22 in California, went a bit under the radar but seriously compounded the shifts instigated by the pandemic.
When the pandemic blossomed in March 2020, businesses shut down and employers began massive waves of furloughs that became layoffs. Desperate for any sort of income, hundreds of thousands of people joined an already overcrowded, underpaying gig economy; within the first few months of the outbreak, grocery delivery apps like Instacart and Amazon Flex added over 550,000 workers, who were forced to put themselves at the mercy of algorithms and assume all risk and expenses in exchange for low wages and no security. In 2019, one study showed that drivers were making an average of $9/hour after all the expenses that they had to cover. Even more competition made it even worse.
A few years ago, lawmakers in California decided to do something about the garbage compensation that Uber, Lyft, Instacart, DoorDash, and other gig companies offered their workers. In 2019, Gov. Gavin Newsom signed a law known as AB 5, which created a standardized “ABC” test to determine whether someone is a full-time worker and therefore owed certain benefits and pay from their employer. But “laws are only as good as their enforcement,” says Veena Dubal, a law professor at the University of California, and the gig economy companies decided that they didn’t feel like obeying AB 5.
“Mom and pop companies know that they cannot weather a lawsuit, so they are going to be in compliance,” Dubal tells Progressives Everywhere. “But companies like Uber and Lyft, they don’t have a viable business model and they’re hemorrhaging millions a year, but because of all of their venture capital funding, they can afford to say ‘go ahead and sue us.’”