Uber and Instacart don’t represent Silicon Valley. Why we’re voting “No” on Prop 22

Under the legal definition of “employee,” gig workers are misclassified as independent contractors

The classical idea in economics that competitive-equilibrium pricing maximizes social welfare relies on the assumption that every participant in the market has the same welfare weight—but that’s not the case in markets where there is significant inequality.

Through our collective experiences studying the future of work from various angles—as participants, builders, and investors in the category—we’ve come to believe that the gig economy is broken, and Prop 22 ensures it stays that way.

Labor laws should reflect the changing nature of work, but Prop 22 is effectively permanent and immutable

Prop 22 is the California ballot proposition that would exempt app-based transportation and delivery companies from having to provide employee benefits (such as minimum wage, paid time off, and sick leave) to gig workers.

The economy is undergoing a profound shift to platform-mediated work, and the conditions around labor are rapidly changing. While the rules of the future of work are currently being debated and litigated, let’s not forget that in centuries past, people died for what we have today: the 8-hour workday, minimum wage, and the prohibition of child labor... See more

New models focus on wealth creation for participants, not just hourly payments or one-time transactions.

While the gig model delivers real benefits to customers in terms of convenience and low prices, the paradigm exists in a legal gray area in terms of worker classification, depriving workers of minimum wage protection, workers’ compensation, health insurance, retirement plans, and paid time off.

By allowing gig companies to classify their workers as independent contractors who earn less than the minimum wage, there are negative externalities to all taxpayers—who foot the bill for government assistance programs like Medicaid. As taxpayers, we are in effect subsidizing the profitability of gig companies that have large independent contractor... See more

So what’s the solution?