Protocol | Workplace

California gig workers just defeated Prop. 22, but it's not that simple

Despite a recent ruling that Proposition 22 is unconstitutional, gig-economy workers are still independent contractors in California.

Protestors hold No on 22 signs

Proposition 22 is now unconstitutional, a judge recently ruled, but Uber and Lyft drivers are still independent contractors in California.

Photo: Josh Edelson/AFP via Getty Images

A California judge recently ruled Proposition 22 as unconstitutional. The judge said Prop. 22, the law that classifies gig-economy workers as independent contractors, violates the California Constitution on a variety of grounds.

The ruling came as part of a lawsuit filed by the Service Employees International Union and others against the state of California.

But this doesn't mean drivers are now employees in California. Uber and Lyft, through the Protect App-Based Drivers and Services Coalition, say they plan to appeal the ruling, which will prolong the process.

Scott Kronland, an attorney for the plaintiffs, said the trial court still needs to sign a judgment, which will take a few days. From there, the gig-economy companies can file an appeal. At that point, there may be litigation about whether the appeal stays the judgment pending the appeal, Kronland explained on a press call this morning.

"The bottom line is that it will be at least several months before there is a decision on appeals," Kronland said.

Kronland, however, is optimistic about the legal process.

"This is a solid, well-reasoned ruling," he said. "There were several ways in which the drafters of [Prop. 22] overreached and included provisions that conflict with our state constitution, which is the higher law. Therefore, we expect the ruling will be upheld on appeal."

Instacart and other gig-economy companies spent $224 million urging voters to pass Prop. 22, with a key message that it would give workers employee-like benefits while keeping their status as independent contractors. The companies, which are pursuing similar legislation in Massachusetts, viewed the ballot measure as the only realistic way of staving off AB 5, a California law that strictly limits when companies can hire workers as contractors.

"We believe the judge made a serious error by ignoring a century's worth of case law requiring the courts to guard the voters' right of initiative," the coalition's spokesperson, Geoff Vetter, said in a statement following the ruling. "This outrageous decision is an affront to the overwhelming majority of California voters who passed Prop. 22."

A number of gig workers have fought against Prop. 22 long before it became law. Since its passage, some workers have protested against it, arguing gig-economy companies misled them about the benefits that would be available under the legislation. They also take issue with the fact that Prop. 22 does not enable them to form unions.

In May, We Drive Progress, Mobile Workers Alliance and SEIU 1021 staged a protest outside Uber's new offices in San Francisco to demand that companies automatically provide health insurance stipends to all workers who meet the minimum time requirements. Under Prop. 22, companies can make gig workers apply for the benefits.

Gig workers across the country hit the streets again in July, staging a protest and strike in response to Uber, Lyft and other companies' labor practices. One demand was the right to unionize.

"I came here to fight to be able to unionize," Ibrahim Diallo, a rideshare driver in the San Francisco Bay Area, told Protocol at the time. "It's unbelievable that we are not allowed to form a union."

Another driver, Erica Mighetto, told Protocol up to 80% of driver fares went directly to Uber and Lyft. Uber, however, disputed that claim.

On the press call, rideshare driver and plaintiff Mike Robinson said he felt "relieved that the court struck down Prop. 22." He called the legislation "shameful" and said it "stripped us of our basic rights as workers."

But Uber, just like SEIU and the plaintiffs, are confident in the appeals process.

"We will appeal and we expect to win," Uber spokesperson Noah Edwardsen said in a statement. "Meanwhile, Prop[.] 22 remains in effect, including all of the protections and benefits it provides independent workers across the state."

SEIU 721 President Bob Schoonover put Prop. 22 in the same bucket of discriminatory legislation as anti-same sex marriage ballot measure Prop. 8 and Prop. 187, which targeted undocumented immigrants. Both those measures were overturned, and Schoonover expects the same for Prop. 22.

"The attempt by Uber, Lyft and others to circumvent our democracy has failed,"Schoonover said on the press call. "Corporations alone should not dictate laws in our state. SEIU will continue to stand alongside the drivers waging this critical fight to protect democracy from the highest spender."

Protocol | Enterprise

How Cloudflare thinks it can become ‘the fourth major public cloud’

With its new low-cost R2 cloud storage service, Cloudflare is jumping into direct competition with the AWS service that launched the cloud computing revolution.

Cloudflare will not charge data-egress fees for customers using R2, taking direct aim at the fees AWS charges developers to move data out of its widely popular S3 storage service.

Photo: Martina Albertazzi/Bloomberg via Getty Images

Cloudflare is ready to launch a new cloud object storage service that promises to be cheaper than the established alternatives, a step the company believes will catapult it into direct competition with AWS and other cloud providers.

The service will be called R2 — "one less than S3," quipped Cloudflare CEO Matthew Prince in an interview with Protocol ahead of Cloudflare's announcement Tuesday morning. Cloudflare will not charge data-egress fees for customers using R2, taking direct aim at the fees AWS charges developers to move data out of its widely popular S3 storage service.

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Tom Krazit

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The pandemic won't be over until the economy recovers. While cities, states and regions across the U.S. are grappling with new variants, shifting mask policies and other factors that directly impact businesses large and small, it is nevertheless time for brands and enterprises to jumpstart COVID-19 recovery strategies.

Data will undoubtedly be critical to such strategies, but there is one type of data in particular that is poised to yield greater impact than ever in the COVID-19 Recovery Era: location data.

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Michele Morelli, Foursquare
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Power

VR pioneer The Void is plotting a comeback

Assets of the location-based VR startup have been acquired by a former investor, who plans a relaunch with key former team members.

The Void's New York outpost closed during the pandemic. Now, the company is planning a comeback under new ownership.

Photo: The Void

Location-based VR pioneer The Void may rise from the ashes next year: A former investor has acquired key assets of the defunct startup and is now looking to relaunch it with key team members, Protocol has learned. The company is said to be actively fundraising, and is getting ready to start hiring additional talent soon.

The Void's patents and trademarks were recently acquired by Hyper Reality Partners, a company headed by former OneWeb CEO Adrian Steckel, who also used to be an investor in and board member of The Void. Hyper Reality Partners is actively fundraising for a relaunch of the VR startup, and is said to have raised as much as $20 million already, according to an industry insider.

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Janko Roettgers

Janko Roettgers (@jank0) is a senior reporter at Protocol, reporting on the shifting power dynamics between tech, media, and entertainment, including the impact of new technologies. Previously, Janko was Variety's first-ever technology writer in San Francisco, where he covered big tech and emerging technologies. He has reported for Gigaom, Frankfurter Rundschau, Berliner Zeitung, and ORF, among others. He has written three books on consumer cord-cutting and online music and co-edited an anthology on internet subcultures. He lives with his family in Oakland.

Protocol | Workplace

A new McKinsey study shows that women do more emotional labor at work

The 2021 Women in the Workplace report from McKinsey found that women are far more likely than men to help their teams manage time and work-life balance and provide emotional support.

Senior leaders who identify as women were 60% more likely to provide emotional support to their teams and 26% more likely to help team members navigate work/life challenges, according to the report.

Photo: Luis Alvarez via Getty Images

Over the last year, emotional support, time management skills and work-life balance have become drastically more important and difficult in the workplace — and women leaders were far more likely than men to step in and do that work for their teams, according to the latest iteration of McKinsey and LeanIn.org's annual Women in the Workplace report.

Senior leaders who identify as women were 60% more likely to provide emotional support to their teams, 24% more likely to ensure their teams' workload is manageable and 26% more likely to help team members navigate work/life challenges, according to the report. In addition, about one in five women senior leaders spend a substantial amount of time on DEI work that is not central to their job, compared to less than one in 10 male senior leaders.

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Anna Kramer

Anna Kramer is a reporter at Protocol (Twitter: @ anna_c_kramer, email: akramer@protocol.com), where she writes about labor and workplace issues. Prior to joining the team, she covered tech and small business for the San Francisco Chronicle and privacy for Bloomberg Law. She is a recent graduate of Brown University, where she studied International Relations and Arabic and wrote her senior thesis about surveillance tools and technological development in the Middle East.

Amazon needs New World’s launch to be a success

New World arrives Tuesday. Whether it flops could determine the future of Amazon Games.

New World launches on Tuesday, after four delays. It could be Amazon's first big hit.

Image: Amazon

Amazon's New World launches on Tuesday, marking the end of a long and bumpy road to release day for the company's most pivotal video game release to date. There's a lot riding on New World, a massively multiplayer online game in the vein of iconic successes like Blizzard's long-running World of Warcraft and Square Enix's immensely popular Final Fantasy XIV.

If the game succeeds, New World will mark a rare success for a technology company in the gaming space. With the exception of Microsoft, which entered the console game industry nearly two decades ago, tech firms have tried time and again to use their engineering talent and resources to crack the code behind making successful video games. Almost every attempt has failed, but Amazon is the closest to having a hit on its hands. If it flops, we could see Amazon's gaming ambitions go the way of Google's.

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Nick Statt
Nick Statt is Protocol's video game reporter. Prior to joining Protocol, he was news editor at The Verge covering the gaming industry, mobile apps and antitrust out of San Francisco, in addition to managing coverage of Silicon Valley tech giants and startups. He now resides in Rochester, New York, home of the garbage plate and, completely coincidentally, the World Video Game Hall of Fame. He can be reached at nstatt@protocol.com.
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