Uber and Lyft pledge $60M for a CA ballot measure declaring their drivers non-employees, if AB 5 bill, which hinders classifying drivers as contractors, passes
- Ballot proposal would counteract proposed California rule — Deal offers drivers some perks, keeps contractor status
BloombergJosh Eidelson
Context & Ripple Effects
This $60M pledge is the opening move in what became a multi-front fight over AB 5. The bill, then moving through Sacramento, would make it far harder to classify drivers as contractors, and Uber and Lyft's answer is to take the question straight to voters with a ballot measure that would declare drivers non-employees while offering them some perks. A parallel legal track followed: in mid-2020 the California AG moved to seek an injunction forcing reclassification under AB 5 before the courts could weigh in.
The ballot-measure strategy worked. A driver-backed measure to keep gig workers as contractors followed in late 2019, and in November 2020 California sided with Uber, Lyft, and DoorDash on Prop 22, exempting the platforms from reclassification. Within weeks, the companies rolled out the promised perks — guaranteed minimum earnings and health care stipends for California drivers.
First-order effects
Uber and Lyft commit $60M to a statewide campaign, shifting the classification fight from the legislature to California voters, with the perk package in the deal as the public-facing concession to drivers.
Second-order effects
DoorDash and other gig platforms are pulled into the same defensive coalition — they later join the Prop 22 effort — because an AB 5 reclassification ruling against Uber and Lyft would set a precedent covering their own California workforces.
Third-order effects
If the pattern holds, worker-classification disputes in the gig economy get decided by company-funded ballot initiatives rather than legislatures or courts, and the perk packages that bought contractor status — minimum earnings, health stipends — harden into a template for how platforms price labor law compliance.
The trend: Gig platforms are moving worker-classification fights out of legislatures and courtrooms and into company-funded ballot measures, trading targeted benefits for exemption from employment law.
New: Uber & Lyft are each putting $30 million into a campaign account for a potential ballot measure that would ensure they can keep treating drivers as non-employees, in case they can't get a legislative deal https://www.bloomberg.com/... Consultants are hired & language is draf…
AB 5 author @LorenaSGonzalez calls the potential measure part of California's “long history of Wall Street billionaires pumping a fortune into ballot measures to further erode the middle class.” https://www.bloomberg.com/... https://twitter.com/...
A California bill could soon force Uber and Lyft to treat their drivers like employees. But the 2 companies said that they will spend $60 million on a ballot initiative that would essentially exempt them from the proposed law. https://www.nytimes.com/...
“Uber Technologies Inc. and Lyft Inc. are putting $60 million behind a potential ballot measure to ensure they don't have to reclassify their California drivers as employees.” #AB5 update from @josheidelson https://www.bloomberg.com/...
I could not agree more. David Weil says that “people are really playing with fire...Creating carve-outs for this kind of model risks undermining the entire system of employment protections that we've had in places for decades.” #yesonab5 & NO to compromise https://www.bloomberg.c…
Updated: DoorDash is putting $30 million into a separate ballot measure campaign account, bring total gig firms committed today to $90 million https://www.bloomberg.com/... Company says it's confident that if ballot measure is necessary, platform firms will unify behind a single …
New: Uber & Lyft commit $60 million to fund a state-wide ballot initiative to keep treating their workers as contractors. This announcement comes a day after execs from both cos met w/ Gov. Newsom in part to discuss what they're proposing as an alternative https://www.latimes.com…