Uber, Lyft carry lead in early Prop. 22 results

The $200-million Proposition 22 campaign led by Uber and Lyft was ahead in early election results as of Tuesday evening, but it remains too early to tell if the companies will succeed in their effort to seek an exemption from California employment law and continue treating workers as independent contractors.

The fight is the one of the most closely watched ballot measure contests in the country and has been the costliest in state history.

A win for the app-based companies has the potential to create a new campaign paradigm, with companies sidestepping government and spending large sums of money to sway voters with traditional advertisements and more unconventional direct marketing to customers. The measure’s failure could prove the power of California labor unions, underdogs in the race with far fewer financial resources than their foes.

“Yes on 22” held an edge over the opposition with 57% of the vote, compared with 43% of the first 5.5 million ballots counted. The ballot measure needs more than 50% of the vote to become law.

At the crux of the measure is a debate about the changing American workforce. With Proposition 22, voters will decide whether people who sign into an app to deliver groceries or drive riders to and from the airport should receive the same employment protections, benefits and wages as more traditional workers.

Uber and Lyft have long argued that state regulations fail to account for the complexity of their business models and they should be treated as technology platforms, not transportation providers. The measure would allow the companies to avoid paying for a standard, more expensive suite of benefits as required under state law, but still provide workers — who would remain independent contractors — with some benefits.

Proposition 22 would require the companies to provide an hourly wage for time spent driving equal to 120% of either a local or a statewide minimum wage. It also requires that drivers receive a stipend for purchasing health insurance coverage when driving time averages at least 15 hours a week, a stipend that grows larger if average driving time rises to 25 hours a week.