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Uber And Lyft To Continue Treating Drivers As Independent Contractors

AUDIE CORNISH, HOST:

Let's look now at one clear victory in yesterday's election. Uber and Lyft are celebrating a big win in California. Voters there overwhelmingly chose to let the ride-hailing companies continue treating their drivers in the state as independent contractors not as employees. NPR tech correspondent Shannon Bond joins us. Before we begin, we want to note that Uber and Lyft are among NPR's financial supporters.

Shannon, I want to start with what this means for the drivers of these companies.

SHANNON BOND, BYLINE: Right. So there are hundreds of thousands of drivers here in California, and it means they won't be getting standard employment benefits from these companies, so things like health insurance, paid sick leave, overtime pay. Now, the state had passed a law extending those benefits to gig workers, but Californians have now voted to exempt Uber, Lyft and similar apps from the law. However, under the ballot measure that voters just approved, the companies will give some limited benefits to drivers, so things like subsidies for health insurance for some drivers, accident insurance and some guarantees about pay.

CORNISH: This creates a major, essentially, exemption to new California law. Is there any word from state officials on that?

BOND: Well, the state lawmaker who wrote this labor law - she said she and her allies would continue to fight for worker protections. You know, what we're really looking for is to hear from the state attorney general's office. They didn't have any comment while election results are still being certified. But the attorney general and prosecutors in three big cities here had sued Lyft and Uber earlier this year, trying to force them to comply with this labor law. So that - this doesn't mean that legal battle is over, but it means that any outcome will be far more limited because of how voters have chosen.

CORNISH: Are there any takeaways here about how people should view this industry?

BOND: Well, you know, when I talked to drivers about this ballot measure, their support or opposition in many cases hinged on concerns about flexibility. So many of them say they want to choose when and how they work. And the companies had warned that if they had to make drivers employees, they would set schedules. They might employ a lot fewer drivers, and I think that concerned a lot of people. But really, the biggest lesson in this whole battle has been the power of money. So Uber, Lyft and food-delivery app DoorDash - they spent more than $200 million promoting this ballot measure. It was the most expensive campaign over a ballot initiative in California history.

You know, and here in Berkeley, you know, I was flooded with texts. I got mailers at my house about it. The companies used their apps to lobby drivers and passengers. You know, they put out these claims that the measure was good for drivers. They warned that there would be higher fares, longer wait times. And like I said before, you know, they would employ fewer drivers if they had to make the drivers employees. And, you know, all of that money they spent - it really seemed to have worked. Californians voted to approve this ballot measure, and it was money well spent for these companies.

CORNISH: That's NPR's Shannon Bond.

Thanks.

BOND: Thank you.

(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.

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