The California Supreme Court on July 25 upheld the state's Proposition 22, which made app-based workers for ride-hailing and delivery companies—such as Uber, DoorDash, and Instacart—independent contractors with some benefits, rather than full-fledged employees. We’ve gathered articles on the news from SHRM Online and other outlets.
Unanimous Decision
The court’s decision on Proposition 22 was unanimous.
Approved by 58% of California voters in 2020 and enacted the same year, Proposition 22 gave app-based gig workers some benefits, but not full worker protections, because the ballot initiative ensured they are not considered employees.
More than 1.4 million Californians are app-based gig workers, according to the industry’s latest estimates.
Lengthy Battle
The decision capped a yearslong battle between the Service Employees International Union (SEIU) and gig companies over the status of workers who are dispatched by apps to deliver food, buy groceries, and transport customers. A 2018 California Supreme Court ruling and a follow-up bill would have compelled the companies to treat those workers as employees.
A group of five gig companies then spent more than $200 million to defeat that mandate by getting Proposition 22 approved by voters.
In a statement, SEIU leaders said they were “disappointed” in the ruling but would continue to fight for a ride-hail driver union to advocate for further rights and protections.
(Politico)
Wider Push for Higher Wages and Benefits
The California decision comes amid a national push by labor groups and gig workers for higher wages and increased benefits. Gig workers have so far seen increased minimum pay legislation enacted in Massachusetts, Minnesota, and Washington state, as well as New York City.
State Appeals Court Decision Upheld
In its decision, the California Supreme Court upheld the ruling of a state appeals court last year that ride-hailing and delivery companies may continue to treat their California drivers as independent contractors.
Gig Companies Welcome ‘Landmark Victory’
Gig companies that backed Proposition 22 celebrated the California Supreme Court’s ruling, saying the measure affords workers control over their schedules.
“Today marks an historic moment and a landmark victory,” Morgan Fong, general counsel for Instacart in San Francisco, said in a statement. “Instacart shoppers consistently and overwhelmingly tell us they value their flexibility and independence. The Court’s decision preserves access to the flexible earnings opportunities they want and the important benefits provided under Prop. 22.”
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