The battle over California’s gig worker law continues as the state supreme court has deigned to rule on the ultimate legality of Proposition 22.

Prop 22 was a voter-passed initiative spurred on by Uber, Lyft, Doordash, and other companies that rely on so-called “gig workers” to fuel their business model. Prop 22 limited the purview of 2019’s Assembly Bill 5, which aimed to curb the practice of employers over-classifying workers as “independent contractors” rather than “employees.”

The distinction is consequential. As California employment law attorney Richard Koss explains, “employees are guaranteed minimum wage for all hours worked, overtime pay, workers’ compensation, sick leave, reimbursement for necessary business expenses, and are protected by discrimination and whistleblower statues among others.” Independent contractors, on the other hand, are not guaranteed any of these rights. Koss does point out that California’s main antidiscrimination act, the Fair Employment and Housing Act (FEHA), does protect independent contractors as well as employees from harassment. “With the exception of harassment, however, the FEHA applies to employees only,” says Koss.

Under AB 5’s test for worker classification, most gig workers in the state--including rideshare and delivery drivers--would be deemed employees, entitled to rights such as a minimum wage, overtime, workers’ compensation, and other benefits. Uber, Lyft, and other gig worker-based companies lobbied hard against AB 5, arguing that it would raise costs to the point of devastating the app-based industry.

In 2020, voters approved Prop 22, which established that app-based workers would be classified as independent contractors regardless of the AB 5 test while being granted some wage protections. The proposition was backed by the gig-supported companies as well as by many drivers who prefer the flexibility of the independent contractor designation to the strictures of being a proper employee, even as they sacrificed their own labor law protections.

To help voters accept Prop 22, the proposition was written to include certain rights and wage protections for independent contractors, even though they don’t have the full rights and protections of employees. Employment lawyer Koss explains, “Gig workers are guaranteed 120% of minimum wage, but only for active driving time (not waiting time). They may also qualify for a health “stipend” if they work the required numbers of hours per week.” According to Koss, Prop 22 also provides that independent contractors are to be covered by disability insurance and reimbursed for mileage at approximately half the IRS suggested rate for reimbursement.

Both AB 5 and Prop 22 have faced ongoing legal challenges. In August 2021, a California superior court judge declared Prop 22 unconstitutional. The court held that Prop 22 unlawfully infringed on the state legislature’s authority to determine how the covered workers are subject to the workers’ compensation law. The court also found that Prop 22 went too far in requiring a seven-eighths supermajority of the legislature to amend the law, which amounted to a violation of the constitutional separation of powers. Based on the law’s structural weaknesses, the court invalidated Prop 22 in its entirety.

On appeal, the higher court ruled that Prop 22 was not unconstitutional insofar as it affected the workers’ compensation law. The court did agree, however, that the law stepped on the toes of the legislature and the judiciary to the extent it self-determines what constitutes an amendment and how such an amendment may be passed. Because the appeals court ruled that the offending portion of the law could be severed from the rest, most of Prop 22 was reinstated.

Parties sought review before the California Supreme Court to issue a final ruling on the legality of Prop 22. On Wednesday, the Court agreed to take up the case and resolve the thorny constitutional questions presented.

The state high court’s review of Prop 22 will take place as parallel challenges to AB 5 continue in federal court. In March, a panel of Ninth Circuit judges ruled AB 5 violated the Equal Protection Clause of the Constitution by unlawfully impacting specific companies, including Uber and Postmates, while exempting other industries. The State of California, supported by a “friend of the court” brief signed by 15 other state attorneys general, requested the entire Ninth Circuit take another look at the case en banc.

Meanwhile, California’s gig workers continue awaiting a final determination of their rights.