December 4, 2022

According to a report published Wednesday, ride-hailing drivers in California are taking home $6.20 an hour under a law approved by state voters a few years ago.

Proposition 22, which is in legal limbo after a court ruled unconstitutional last year, promised, among other things, 120% of the state’s minimum wage to gig workers. But according to the report developed by the National Equity Atlas and Rideshare Drivers United, which groups say it is the first driver-led study to directly assess the impact of Proposition 22 using aggregated income data and working conditions , the reality is very little that promise.

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“The ride-hailing companies and DoorDash were throwing millions of dollars at him, but not at me,” said Uber and Lyft driver Dominic Smith in the Bay Area during a news conference on Tuesday. “In the beginning I was definitely not a fan of Proposition 22, and I am definitely not a fan of the latter.”

Uber Technologies Inc. The effect of California law supported by UBER,
Lyft Inc. Lyft,
and other gig companies such as DoorDash Inc. dash,
are important and potentially far-reaching as companies try to expand Proposition 22 or something similar — what Uber calls the “independent contractor-plus” model — to other states and countries. In addition, the report cites Bureau of Labor Statistics data showing that in 2019, the number of US adults who worked as a taxi driver or driver for their primary job exceeded that of Uber and Lyft over the past decade. had tripled with the rise of

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The report is based on data from about 12,500 rides for Uber and Lyft, the two major ride-hailing companies, over a month in 2021, although the earnings analysis is based on a small sample of 21 drivers for whom the researchers had sufficient data. . According to the report, the average gross pay for drivers, including bonuses and tips, was $26.30 an hour. To arrive at the average take-home pay figure per hour, the report’s authors took into account the hours the drivers worked, as well as the benefits they would be entitled to if they were considered employees, such as reimbursement for driving expenses, Unemployment insurance, paid leave and employee compensation. Because some, but not all, drivers are eligible for a health insurance stipend under Proposition 22, which was excluded from the calculation. “Proposition 22 is causing drivers to lose approximately $20.10 an hour,” the report’s authors wrote.

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Uber and Lyft rejected the report and offered numbers from the studies they backed up.

“This is a flawed survey that is unethical for what drivers experience in California,” said a Lyft spokesperson. “With record low unemployment and more than 1 million traditional job openings in California, drivers would not continue to choose this job if there was any truth to these findings.”

Lyft’s own Economic Impact Report found that 92% of Lyft drivers “support a policy proposal under which drivers will remain independent contractors” and have some benefits but not full employee benefits.

An Uber spokesperson also called the survey “flawed” and said: “Looking at the same dates in 2021, among the thousands of drivers active on the platform, the average gross earning on Uber in California was more than $30 per hour spent online , which is much more than what they claim.”

The period covered by the driver-led report was November 1 to December 12, 2021, during a quarter in which Uber and Lyft grew revenue and said their businesses had reached a coronavirus-pandemic high. In addition, ride-hailing charges per mile were up more than 35% year over year around that time, according to data obtained from YipitData.

A Lyft spokeswoman mentioned benefits that gig workers are entitled to under Proposition 22, such as quarterly health care stipends and occupational accident insurance. A spokesperson for Uber and a spokesperson for the coalition that represents gig companies, Protect app-based Drivers + Services, cited an industry-backed survey by UC Riverside’s Center for Economic Forecasting and Development, which found that drivers Earn more than $34 on average. Bell

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Smith, a Bay Area driver, said that despite driving full-time or almost full-time, he “has no ability to make up the tight quotas for receiving stipends.” In an interview after the news conference, he said, “Only a certain number of drivers can qualify. They have a high bar.”

But Chris Hoyt, a Sacramento driver who has done ride-hailing in the Bay Area and elsewhere in California for the past eight years and who used to be on Lyft’s driver advisory council, said that if Lyft drivers average at least 15 a week hours, they qualify for a partial stipend.

Hoyt, who said he voted for Proposition 22, also shared that he drove for Uber for about three-and-a-half hours on Tuesday and earned $130.

“Money has to be made there,” he said. “How you make it and how you do it is really huge.” However, he acknowledged that every driver has different circumstances. For example, he said, “Some people are renting a car. How much are they paying for it?”

The report also found that ride-hailing operations have become “less flexible and more controlled” by ride-hailing companies under Prop 22. This is partly due to changes that companies have made since Proposition 22, such as changing the Uber Pay formula, to boom, according to the report. Drivers interviewed for the report said that in order to try to earn as much as they did before, they had to work irregular or longer hours, accept more rides and rely more on tips and bonuses.

“It’s not about flexibility,” Rideshare Drivers United president Nicole Moore said during Tuesday’s news conference. “It’s about companies being allowed to pay the minimum wage.”

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The report’s authors also emphasized that their findings suggest that Proposition 22, which was approved by 58% of California voters in 2020, contributes to racial inequality due to the demographics of ride-hailing drivers. Of the 55 drivers whose data was collected for the report, 71% were of color and immigrants, said PolicyLink’s Eliza McCullough, one of the report’s authors.

The National Equity Atlas is a research partnership by PolicyLink and the University of Southern California Equity Research Institute. Rideshare Drivers United is a labor group that says it has more than 20,000 members in California.

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