California’s highest court will hear arguments today on the legality of Proposition 22, a ballot measure that exempts app-based transportation companies like Uber and Lyft from classifying drivers as employees.
The lawsuit, filed by the Service Employees International Union (SEIU) and four drivers, challenges the constitutionality of Prop 22. They argue it restricts the legislature’s ability to provide basic worker protections to gig workers.
Prop 22, passed in 2020, allows app-based companies to classify drivers as independent contractors, denying them benefits like minimum wage, overtime pay, and unemployment insurance. In exchange, drivers receive a guaranteed minimum pay while transporting passengers, along with expense reimbursements and healthcare subsidies.
The outcome of this case will have significant implications nationwide. California is at the forefront of a national battle over how gig workers should be classified. A recent study by UC Berkeley found that app-based drivers in California earn significantly less than the minimum wage when considering downtime.
Those in favor of Prop 22, including app-based companies and some drivers, argue that it gives drivers flexibility and allows them to control their work schedules. Opponents argue that Prop 22 exploits workers and denies them essential benefits.
The California Supreme Court’s decision will be closely watched by policymakers and businesses across the country. It could set a precedent for how other states handle the classification of gig workers.