Uber and Lyft paid $400K to firm conducting ‘independent studies’ on Proposition 22

On Election Day, California voters will decide on Proposition 22, a contentious ballot measure that decides the fate of the state’s gig workers. As the vote approaches, both sides are making their closing arguments.

The Yes side, backed by companies like Uber and Lyft, is pushing for workers to be classified as independent contractors, while the No side is arguing workers should be employees. One of the main points of contention is whether the initiative will help or hurt gig workers. That’s where a barrage of studies come in.

Uber, Lyft and the Yes on Proposition 22 campaign have sent emails and messages to voters citing “independent studies,” including one that calculates “hundreds of thousands of jobs” will be lost if Proposition 22 fails. The messages also reference a survey that says drivers wish to remain independent contractors by a “4-to-1” margin.

A popular ride-hail blogger conducted that survey through an informal poll on his website. But many of the other studies referenced by the campaign were financed by Uber, Lyft and the other companies that will benefit if Proposition 22 passes. Berkeley Research Group, which conducted the study on job loss, has received more than $411,000 from the Yes campaign, according to public records filed with California’s secretary of state. Benenson Strategy Group and the University of California, Riverside also conducted research that was funded by Uber and Lyft, respectively. 

The No campaign has also referenced studies in its messaging, though a spokesman for the campaign said it didn’t commission any of that research.

The torrent of studies come amid a heated campaign over Proposition 22, which is backed by Uber, Lyft, DoorDash, Instacart and Postmates. The battle over the measure has ramifications beyond California because other states — such as New York, New Jersey, Oregon and Washington — are mulling legislation similar to California’s AB5 law, which requires most gig economy companies to reclassify their workers as employees.

The gig economy companies have poured more than $203 million into their effort to prevent that reclassification in the state, which would add payroll costs and benefits, like health care and a minimum wage requirement. The No campaign, backed by unions and labor groups, has raised $15 million. It’s the most expensive ballot measure campaign in California history. 

Both sides have reached deep into the political playbook to make their cases. The Yes campaign has hired conservative operatives to reportedly dig up dirt on labor activists and paid $85,000 to a firm run by the president of the California NAACP, which has endorsed its position. Meanwhile, the No campaign has held driver caravans and protests against the gig economy companies, including one in front of the Uber CEO’s house.

The ride-hailing industry has a long history of funding research that’s favorable to its interests. And studies like those cited by the Yes campaign are common in California politics, said David McCuan, a political science professor at Sonoma State University. He added that it isn’t unusual for campaign organizers to pay consultants with the goal of getting a supportive study. 

“In terms of creating quote-unquote ‘independent studies,’ these are not. These are ‘wink wink nudge nudge’ studies,” McCuan said. “Campaigns are always loosely affiliated with allies who find sympathetic research.”

The Yes campaign has leaned on a Berkeley Research Group study that says at least 80% of driver jobs would disappear if gig economy companies were forced to classify workers as employees. Researchers used confidential and proprietary data from the companies, the firm says in its report, which was released in May. Over the past year, the firm has received 28 separate payments from the Yes on Proposition 22 campaign, according to public records, and it’s authored two studies on gig worker reclassification.

Berkeley Research Group, which isn’t affiliated with the University of California, Berkeley, declined to comment. Uber, Lyft, DoorDash and Postmates didn’t return requests for comment. Instacart referred CNET to the Yes on Proposition 22 campaign. A spokesman for the Yes campaign declined to comment on the payments to Berkeley Research Group but directed CNET to a passage in the report that says the findings are “the result of objective analysis.”

Mike Roth, a spokesman for the No campaign, said, “Uber, Lyft, and DoorDash have taken a shine to buying themselves rigged ‘studies’ to make their case. The app companies can spend all the money they want on bogus data, but they can’t change the truth.”

The No campaign tends to point to various studies that calculate drivers’ earnings as higher when they’re classified as employees. Some of these reports were conducted by economists at the University of California, Berkeley’s Institute for Research on Labor and Employment. 

A paper released by the Institute earlier this month concludes that most drivers in California make less than minimum wage. If reclassified as employees, the study estimates, driver earnings would increase by about 30% and gig economy companies would still need to use part-time workers during high-demand peak hours. 

The paper’s author, Michael Reich, said Berkeley Research Group’s study is flawed because it doesn’t incorporate those fluctuations in demand. 

“Their conclusions of huge job losses disappear once these errors are corrected,” Reich said.

Earlier this week, the Yes campaign issued a press release saying, “independent surveys show groundswell of support among drivers for Prop 22.” The release linked to three surveys by Harry Campbell, a popular Los Angeles-based ride-hail driver and blogger known as the Rideshare Guy. The surveys were conducted in November 2019, May 2020 and October 2020. 

Campbell’s surveys are done through a nonscientific poll on his blog, which asks drivers from across the country about being gig workers. He says he reaches out to thousands of drivers through his email list and usually a few hundred respond. The October 2020 survey, for example, received 609 responses. Campbell’s surveys rely on driver honesty, but they don’t necessarily guarantee a representative sample or truthful answers. California public radio station KQED noted in a report that some of the respondents might not even be actual drivers.  

The Yes campaign hasn’t given Campbell any money or in-kind pay, though he does receive commissions from Uber for signing up new Uber Eats drivers through his blog. He said those payments account for less than 3% of the blog’s gross revenue.

Campbell said he believes his surveys accurately reflect driver sentiment but that he was still surprised to see them being used by the Yes campaign.

“It is a bit strange to see our surveys referenced in Uber and Lyft’s propaganda,” Campbell said. “Personally though, I voted no on 22 out of principal — I don’t think these companies have shown a history of having driver’s best interests at heart.”