Here We Go Again: What is the Status of Gig Workers in California?

The legal battle over whether California’s gig workers are employees or independent contractors continues unabated. In April of 2023, the status of gig workers in California was once again thrown in the air when a California appellate court upheld all but one section of Proposition 22, a ballot measure sponsored by Uber and other companies to exempt its drivers from Assembly Bill 5.

A court decision to strike down one section of Prop 22 favored labor unions by removing a voting rule that said lawmakers needed a high amount of votes to make changes, like letting gig workers join a union. The court said this rule was unconstitutional.

California was at the forefront of gig economy regulation, with the passage of Assembly Bill 5 in 2019. It classified workers as employees unless they met three requirements: freedom from control, performing work outside the usual course of the company’s business, and operating as an independently established business. But AB 5 proved controversial. First, it immediately faced legal challenges, particularly from gig economy companies such as Uber, Lyft, and DoorDash, who argued that the law would hurt their business model and the flexibility of their drivers.

Gig workers themselves didn’t seem to agree on which classification they preferred and were often seen on opposite sides during protests. Some preferred the flexibility of being their own boss while others wanted the benefits of being on a payroll.

Then, in November 2020, California voters approved Proposition 22, which exempted ride-hail and delivery drivers from AB 5 and established a new framework for their classification as independent contractors with some benefits. Critics of Proposition 22 argue it undermines labor protections and creates a two-tier system for workers. Supporters claim that it provides a balance between flexibility and benefits for workers. And no surprise, the implementation of Proposition 22 has also been challenged in court.

In California, gig workers continue to face uncertainty about their status and protections. The state has been exploring alternative models for worker classification, such as the “dependent contractor” proposed by some labor advocates, which would provide some employee-like benefits while preserving flexibility. However, any changes to the current framework would require legislative action and potentially face opposition from gig economy companies once more.

Despite all the challenges and controversies, the gig economy remains a significant part of the California labor market, particularly in sectors such as transportation, delivery, and online platforms. “Anyone who thinks they are being misclassified at work should speak to an experienced employment law attorney who specializes in misclassification cases,” said attorney J.J. Dominguez of The Dominguez Firm. “Given the constantly changing legal landscape of this situation, it’s best to have a strong advocate with up-to-date knowledge of the latest regulations by your side.”

Clearly, the status of gig workers in California as of April 2023 is still evolving and subject to legal and regulatory developments. While Proposition 22 has exempted ride-hail and delivery drivers from AB 5, the broader issue of worker classification and protections remains unresolved. This latest decision means a review by the California Supreme Court is very likely to occur. Depending on the Supreme Court’s decision, the legislature may also tackle the question. As for the hundreds of thousands of gig workers in the Golden State, they continue to wait for a clear resolution to the question; What is the status of gig workers in California?