Gig Worker Classification Fight in Massachusetts - Ballot Initiative
Gig Economy Companies Pursue Ballot Initiative in Massachusetts
A collaborative effort involving app-based companies like Lyft, Uber, Doordash, and Instacart has resulted in the filing of a ballot initiative petition in Massachusetts. This initiative seeks to maintain the classification of gig economy workers as independent contractors, mirroring a successful campaign previously undertaken in California.
Following the California Model
The proposed ballot measure, spearheaded by the Massachusetts Coalition for Independent Work, arrives approximately one year after California voters approved Proposition 22. Proposition 22 represented a significant and expensive contest between proponents of gig economy businesses and advocates for labor rights.
Lyft, Uber, and other coalition members, alongside several local chambers of commerce within the state, announced their intention on Tuesday to have the question presented to voters during the November 2022 election. However, the proposal must first undergo legal scrutiny and gather sufficient voter signatures to secure its place on the ballot.
Company Stance and Legislative Efforts
During Lyft’s recent earnings call, co-founder John Zimmer articulated the company’s position. He stated their primary goal is to achieve a legislative resolution in Massachusetts, but this ballot initiative represents a continuation of their advocacy for what the majority of drivers desire – a flexible earning opportunity coupled with enhanced benefits.
Zimmer further emphasized that while pursuing the ballot option, they remain actively engaged with the Massachusetts State Legislature, continuing to explore a potential legislative solution.
Proposed Benefits for Workers
The coalition asserts that the proposed ballot question would introduce new benefits for app-based ride-hail and delivery workers. These benefits would include healthcare stipends, while preserving their status as independent contractors.
Key provisions highlighted by the coalition include an earnings guarantee equivalent to 120% of the Massachusetts minimum wage – translating to $18 per hour in 2023 from app-based platforms, excluding customer tips. Additionally, drivers working at least 15 hours weekly would receive healthcare stipends.
Drivers would retain all tips earned and be assured a minimum of $0.26 per mile to offset vehicle maintenance and fuel costs, according to the coalition’s details.
Labor Activist Opposition
Labor organizations are already voicing opposition. The Coalition to Protect Workers’ Rights, comprising groups like the NAACP New England Area Conference, the Union of Minority Neighborhoods, and the Massachusetts Immigrant and Refugee Coalition, released a statement on Tuesday criticizing the ballot measure’s language as detrimental to workers.
Concerns Regarding Worker Protections
The group contends that the measure contains significant loopholes that could establish a subminimum wage for app-based workers and limit access to healthcare benefits. They also point out that the proposal could eliminate anti-discrimination safeguards, dismantle workers’ compensation regulations, and potentially defraud the state unemployment system of substantial funds.
Ongoing Legal Challenges
Simultaneously, Uber, Lyft, and the broader coalition are facing a lawsuit initiated last year by Massachusetts Attorney General Maura Healey. The Attorney General is seeking a court ruling declaring Uber and Lyft drivers to be employees under Massachusetts Wage and Hour Laws.
Attorney General's Argument
The Attorney General’s Office argues in its complaint that Uber and Lyft fail to meet the three-part test stipulated by state law for classifying workers as independent contractors. This test requires that workers be free from company control, perform services outside the core business operations, and engage in similar work independently.
Uber's Proactive Strategy
Uber has indicated since last year its intention to advocate for legislation mirroring Proposition 22. During a November 2020 earnings call, Uber CEO Dara Khosrowshahi announced the company’s commitment to “more loudly advocate for laws like Prop 22.” He further stated that securing similar legislation across the U.S. and globally would be a company priority.