A California court confirms that Uber drivers are contractors

SAN FRANCISCO — A California appeals court on Monday upheld a state law that allows Uber, Lyft and other app-based on-demand companies to treat drivers as independent contractors rather than employees.

The ruling was a victory for ridesharing and grocery delivery app platforms, which supported a measure called Proposition 22 ahead of its enactment in the state in 2020.

“We are pleased that the court has respected the will of the people and that Prop 22 will remain in place to protect driver independence,” Tony West, Uber’s chief legal officer, told AFP.

The voter-sanctioned referendum in California that allows many gig workers to be treated as independent contractors was declared unconstitutional in August 2021, prompting further legal wrangling over the controversial measure.

Labor legislation, heavily supported by Uber, Lyft and other app-based on-demand services, repealed a California law that required them to reclassify their drivers and offer employee benefits.

A state judge later ruled that the law violated the California Constitution because the power to legislate on workers’ compensation rests with the legislature.

However, the Court of Appeals ruled that Prop 22 “does not interfere with the legislature’s worker compensation authority.”

The proposal remained in effect throughout the litigation.

Under the proposal, drivers would remain independent contractors, but Uber and Lyft would pay them a range of benefits, including a minimum wage, health care contribution and other forms of insurance.

Labor groups campaigning against the initiative argued that it would undermine workers’ rights and benefits.

The victory of the gig economy in California was expected to resonate across the United States, a boon for app-based services while raising fears that big corporations are rewriting labor laws.

While Prop 22 guarantees some support, such as B. pay above minimum wage and additional health insurance – but it designates drivers as self-employed, which means they are not entitled to some regular employee benefits.

“We’re all stunned, angry and ready to keep fighting,” said Los Angeles Uber driver Nicole Moore, president of Rideshare Drivers United in California.

Moore hoped the union group that challenged Prop 22 will appeal the latest decision to the state Supreme Court.

Moore argued that the proposal did not benefit the majority of rideshare drivers in terms of pay and medical benefits.

“There is nothing good about this law,” Moore told AFP.

“We hope that the[California]Supreme Court will do the right thing.”