Is it still voluntary if it happens out of economic desperation?
California is basically saying that if you can't provide a good job with benefits, you aren't allowed to provide a job at all. That will result in fewer jobs.
Your proposition that if one person makes more money then other people are worse off has an element of truth to it, since, sure, more demand for a given item (like housing) will tend to increase its price, all else equal. But I think that's the wrong way to think about the situation. Wealth creation is not zero sum.
Uber/Lyft business model has just been deemed illegal. let's see if it now can be both legal and sustainable.
Uber/Lyft only existed up until now because they were violating employment laws.