Uber tacks on new fee for Prop. 22 gig worker benefits

California voters were told that voting for Prop. 22 last month would keep ride-hailing and delivery prices from increasing on apps like Uber, Lyft, DoorDash, and Instacart, because all gig workers would stay independent contractors.

But prices are still going up on the Uber app, even though Prop. 22 passed in California with 58.6 percent of the November vote. 

The passage of Prop. 22 was a win for apps like Uber and Lyft, since it kept gig workers classified as independent contractors, as they’ve been since the apps launched. As part of the measure backed by Uber, Lyft, DoorDash and other app-based services, the companies agreed to start offering some worker protections and benefits.

The offer package was basically a way for the companies to get out of complying with state law Assembly Bill 5 that required drivers and delivery workers to be treated as employees. That would’ve cost the companies too much, they said. Prices would’ve gone up, and service availability would’ve dropped, both Lyft and Uber claimed (in court).

This week, those benefits — as part of a package devised by the companies themselves, not the state — are starting up for gig workers on the Lyft and Uber apps. They include benefits for drivers and delivery workers, like a state healthcare subsidy for those who work at least 15 hours per week on average in a three-month period. There’s also guaranteed earnings to make sure drivers are making at least minimum wage, and medical coverage for on-the-job injuries.  

But alongside these new “perks” for workers, on Uber’s ride-hailing app and food delivery service, Uber Eats, the rollout on Monday also included a new fee: the California Driver Benefits Fee. This is only for rides and deliveries in the state, but there was no mention of it in voting materials. It’s unclear how much the fee, which will appear on your receipt when you order a car or restaurant delivery, will add, because this is how Uber explained the pricing: It’s “…based on different marketplace dynamics and different costs of operating in different markets.”

Uber sent an email to California users this week about the new benefits for drivers. It included one sentence about the new fee: “You’ll see a new California Driver Benefits Fee added to each ride of delivery to help make these benefits and protections possible.”

Driver groups like Gig Workers Rising who were part of the “No on Prop. 22” campaign called this “corporate bait and switch.” For drivers, the group is not satisfied with the “meager” benefits Prop. 22 provides. It launched the Workers First app Monday so drivers could track their Prop. 22 benefits and any issues that come up.

In an email statement, the group noted, “Uber and other app corporations said time and again during their Prop. 22 campaign that if the measure failed to go through, riders could expect higher rates. Now that Prop. 22 has passed, Uber is announcing that riders will have to shoulder increased costs after all so that the company can continue to skirt its responsibilities to workers.”

A Lyft spokesperson said there wouldn’t be any price changes for its riders. Driver benefits for Lyft roll out Wednesday, the date Prop. 22 officially becomes legal.