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Lyft Exec On Debate Over Classifying Drivers As Employees Or Contractors

AILSA CHANG, HOST:

As the pandemic worsens, travel is declining again, which is obviously concerning for companies like Uber and Lyft. They have seen their ride-hailing revenues plummet, even as interest in on-demand deliveries has climbed. At the same time, those gig companies have been waging a labor battle to keep their drivers from being classified as employees.

Anthony Foxx is the chief policy officer for Lyft. He also served as secretary of transportation during the Obama administration. And he's a former mayor of Charlotte, N.C. Welcome.

ANTHONY FOXX: Thank you so much. It's good to be with you.

CHANG: So I want to start with what just happened in California last month. Voters passed a ballot measure that exempts gig companies like Lyft from basically classifying their drivers as employees, which essentially means your drivers can be treated as independent contractors, so they won't be eligible for things like minimum wage protections or the right to unionize. Can you just tell me, why is this a good thing?

FOXX: Well, the reality is, first and foremost, that the nature of work is changing all across the country. And what we've done through Prop 22, I would maybe take issue with a couple of the ways the question was phrased in the sense that we're actually establishing a minimum floor for drivers to earn. So whereas before Prop 22, there was no floor below which driver earnings could go, Prop 22 establishes a minimum standard that is actually 20% over the current prevailing minimum wage anywhere in California. So that's just one of the things that Prop 22 does. And...

CHANG: But if the drivers don't have the right to unionize, how do they bargain for - to raise that floor?

FOXX: Well, I think part of the challenge there is that you have these workers who are working between platforms. You know, in the modern era of bargaining, most of the relationships exist between individual unions and individual companies. But this workforce is a workforce that's working between many of these platforms. So you may have the same driver who's working for Lyft part of the time, working for Postmates part of the time, working for DoorDash part of the time. And so unless there is a way of creating sort of a sectoral approach to it, which is used in Europe, it's been really hard for the labor movement to figure out how to solve that problem.

CHANG: Well, apart from the issue of whether drivers are in a better or worse situation with Prop 22, Prop 22 was the most expensive initiative in California's history. Gig companies spent - what? - 10 times what labor advocates spent. Is there an argument to be made that Lyft and other gig companies essentially bought their way out of an employment law they simply didn't like?

FOXX: No, I think that what you see time and time again in polls, not just polls that the companies have run, but polls that, you know, folks like The Rideshare Guy, who is really a spokesperson for many drivers across California and across the country, is that drivers, to a tune of 4-to-1, don't want to be employees. They want to be independent. And that - you know, there are a lot of reasons for that. Many drivers - I think, you know, 90% of our drivers work fewer than 20 hours a week on the platform, and 70-some percent work less than 10 hours a week on the platform. These are people who are - in some cases, they need flexibility that they would not have in a more traditional employment format.

So what happened in Prop 22 was that, you know, drivers told their own stories. And, you know, voters in a state that carried President-elect Biden by 30% also carried this measure at a tune of 59% support. So I think it - you know, there was no pulling the wool over the eyes of voters. There was a lot of money spent in this campaign cycle that didn't succeed.

CHANG: Former transportation secretary and chief policy officer for Lyft, Anthony Foxx. Thank you very much for being with us.

FOXX: Thank you so much. Enjoyed it. Transcript provided by NPR, Copyright NPR.