California Supreme Court Upholds Gig Worker Classification

In a significant ruling on Thursday, the California Supreme Court upheld Proposition 22, a measure that allows app-based services like Uber and Lyft to classify their drivers as independent contractors rather than employees. This decision is seen as a major win for the ride-hailing industry, which argued that classifying drivers as employees would lead to reduced services in the state. The court dismissed a lawsuit from the Service Employees International Union (SEIU) and several drivers who claimed the measure was unconstitutional. Uber hailed the ruling as a validation of the nearly 10 million Californians who voted for Proposition 22, which provides some benefits to drivers while maintaining their independent status. The measure, passed in November 2020 with nearly 60% voter support, allows drivers to be classified as independent contractors if they earn at least 120% of the minimum wage during rides and receive certain benefits, including health insurance subsidies. Despite the ruling, SEIU California Executive Director Tia Orr expressed disappointment but emphasized that rideshare drivers could still advocate for their rights through unionization efforts. The classification of gig workers remains a contentious issue, as employees are entitled to various protections that independent contractors do not receive, potentially costing companies significantly less. The ruling in California is part of a broader national debate over gig worker classification, with other states like Minnesota and Massachusetts also addressing similar issues through legislation and legal settlements. A proposal to allow app-based drivers to unionize is set to be voted on in California this November.