• December 7, 2021

Proposition 22 declared unconstitutional, a blow to CA’s gig economy law

California’s transportation and delivery giants suffered a setback Friday when a state Superior Court judge struck down a 2020 ballot proposal that allowed Uber, Lyft, DoorDash, Instacart and other app-based companies to rank their products. workers as independent contractors.

In a lawsuit filed by the International Union of Service Employees and various drivers, Alameda County Superior Court Judge Frank Roesch ruled that Proposition 22 it is unconstitutional and unenforceable.

That’s in part because the law, Roesch wrote, infringes on the Legislature’s power explicitly granted by the state Constitution to regulate workers’ compensation for injuries.

“If the people wish to use their power of initiative to restrict or qualify a ‘plenary’ and ‘unlimited’ power granted to the Legislature, they must first do so by initiative of constitutional amendment, not by initiative of law,” the judge wrote.

By including language intended to prevent drivers from unionizing, the ballot measure also violates a constitutional provision that requires laws and initiatives to be limited to a single issue, Roesch ruled.

Proposition 22 claims to protect Californians who choose to work as independent contractors, but it also prevents them “obliquely and indirectly” from bargaining collectively, he wrote.

That ban “appears only to protect the economic interests of network companies from having a non-unionized, divided workforce, which is not a stated goal of the legislation.”

Since a ballot initiative cannot be amended after it is approved by the voters, any unconstitutional provision makes it unenforceable.

Private transportation company Uber promised to appeal. “This ruling ignores the will of the overwhelming majority of California voters and defies both logic and the law,” said spokesman Noah Edwardsen. “We will appeal and hope to win.”

Uber and other gig economy companies spent more than $ 220 million last year on the nation’s costliest election campaign to exempt their drivers from a 2019 law, AB 5, that requires gig workers in many industries. are classified as employees with benefits at a minimum. salary, overtime, and workers’ compensation in case of injury.

Californians overwhelmingly approved the measure on the ballot, which won with 58% of the vote in the November election.

“They tried to increase their profits by undermining democracy and the state Constitution,” said Bob Schoonover, chairman of the SEIU California State Council, applauding the ruling. “For two years, the drivers have said that democracy cannot be bought. And today’s decision shows they were right. “

UC Berkeley law expert Catherine Fisk, who filed an amicus brief in the case on behalf of the plaintiffs, said the companies are likely to get a stay of the judge’s ruling in the next two weeks.

After the state appeals court considers it, it will ultimately be decided by the California Supreme Court, he said, adding that the process could take a year.

The California Supreme Court previously refused to hear a constitutional challenge to Proposition 22 in February, ordering the plaintiffs to first file the lawsuit in a lower location.

Experts have said that most measures that appear on the ballot through a signature-gathering process in California inevitably face a legal challenge. And traditionally, California courts often hesitate to overturn ballot measures because the measure can be seen as defying the will of the people.

Geoff Vetter, spokesman for the Protect App-Based Drivers & Services coalition, formed by companies to lead the pro-Proposition 22 campaign last year, called the decision “outrageous” and “an affront to the overwhelming majority of California voters. that approved Prop. 22. ”

Proposition 22 bitterly divided drivers with some backing the initiative and others, in groups like Los Angeles-based Rideshare Drivers United and San Francisco-based Gig Workers Rising and Mobile Workers Alliance, filed an amicus brief against the measure.

The companies operate “well below labor standards,” said Nicole Moore, an organizer for the Los Angeles group. “Most of the voters thought they were helping the drivers. Drivers have seen the complete opposite of help. “

Veena Dubal, a professor at UC Hastings School of Law and a critic of transportation companies, said Proposition 22 “is an extremely, too comprehensive law. This is the first decision of many that I think will show his business overreach. “

The ruling comes at a time when companies are fighting efforts in Massachusetts and other states to classify their workers as employees rather than independent contractors.

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