How Proposition 22 Blocks Cities and Counties From Giving Hazard Pay to Gig Workers

For the first time since the pandemic started, Jacqueline Lopez and her family have money in their savings account. She and her husband both work in grocery stores around Los Angeles and they’re each getting an extra $5 per hour hazard pay.

“It feels good,” Lopez said. “I can pay rent on time.”

They’ve saved $2,000, enough to cover one month of expenses for her family. She has an 11-year-old, a 5-year-old and a 1-year-old. She said all of them, including her husband, got COVID-19 right around New Year's.

The pandemic had already disrupted their work. In the fall, her husband abruptly lost his security guard job. Her hours were cut at a convenience store. So they started working in grocery stores, despite the danger of the pandemic.

“I knew I was taking a big risk when it came to that, but we gotta work. We gotta eat,” she said. “We gotta pay rent.”

Thousands of grocery store workers in California are getting extra pandemic compensation because local governments passed hazard pay laws. More than 20 cities and counties, like Oakland, Daly City and Los Angeles County either have the laws on the books or are considering them.

It took almost a year after the pandemic began for lawmakers to get workers this extra pay, and in most cases it will only last a few months. It also does not apply to all workers in grocery stores. Workers for Instacart, Amazon Prime’s shopping service in Whole Foods and other gig-based apps aren’t eligible for the pay.

Even if lawmakers wanted to extend these benefits to gig workers, they would face an insurmountable legal hurdle because of Proposition 22. The voter-approved measure effectively stipulates that local governments cannot pass laws that specifically increase the pay or benefits for app-based gig workers.

Oakland City Councilmember Noel Gallo said he wishes he could have extended the hazard pay ordinance he cosponsored to include gig workers.

“Many of our front-line workers are out driving you to work, driving you to the grocery store, driving grandma and grandpa, and they also need to stay healthy and survive this crisis we are in," Gallo said.

The grocery industry is increasingly relying on gig workers contracted through apps and denied employee benefits. Instacart said it hired 300,000 workers at the beginning of the pandemic. Amazon changed the layouts of Whole Foods to accommodate all the contract shoppers. Chains like Albertsons are replacing delivery employees with DoorDash contractors.

While these workers experience the same increased exposure to COVID-19 as others in the grocery store, they aren’t getting the pay increase.

Geoff Vetter, a spokesperson for the Protect App-Based Drivers and Services coalition, said California cities and counties would have to raise the minimum wage for everyone if they want to increase pay for app-based workers.

That has significantly limited the options for local governments to regulate the gig economy.

“What is so extreme about what Prop. 22 did is that it pretty much wrote us all out of the equation entirely," said San Francisco Supervisor Matt Haney, who sponsored an ordinance to make gig companies provide personal protective equipment and pay workers for the time to sanitize their cars during the pandemic.

Haney added that Proposition 22 has given gig companies legal grounds to sue and block an ordinance like this if they decide they don’t want to comply with it.

“Sometimes, as a local government, we are preempted by the states or feds, but usually when that’s the case, another regulatory body or the state Legislature is taking up the responsibility," Haney said. "What’s the case here is that some regulations that were written into law by the companies and passed by the voters have made it impossible for anyone to provide more extensive and stronger regulations.”

Rey Fuentes, a legal fellow at the Partnership for Working Families, said California cities and counties have a history of pioneering progressive pro-worker legislation, like San Francisco’s paid sick leave program, which he said was the first of its kind in the nation.

Fuentes said it's important for municipalities to test new policies out so that there are models for state and federal laws. “This allows for the experimentation that I think is so vital to our democracy and to developing good policy,” he said.

While grocery stores are pushing back on the hazard pay by temporarily closing locations and threatening legal action, gig companies don’t have to. Proposition 22 stops local governments from even trying to get higher wages or better benefits for gig workers, halting local experimentation with policy that could help the state’s growing number of app-based gig workers who are denied employee benefits and protections.