On July 25, 2024, the Supreme Court of California upheld a state law permitting ride-sharing apps to continue classifying their drivers as independent contractors, rather than employees. The ruling is likely to have a significant impact on the gig economy in the state, preserving the ability of applicable rideshare and delivery network companies to classify their drivers as independent contractors.
Quick Hits
- A recent opinion from the Supreme Court of California permits app-based platforms to keep classifying their drivers as independent contractors in California.
- The court decided a state law regarding the independent contractor classification did not violate the state constitution.
- Going forward, app-based platforms will not have to treat their drivers as employees.
The ruling means that because app-based workers are independent contractors they are exempt from overtime and workers’ compensation laws.
Several drivers and the Service Employees International Union sued the state, claiming that a state law called Proposition 22 violated the California Constitution because it interfered with the state’s power to regulate a workers’ compensation system through legislation. Proposition 22, a ballot initiative that passed in California with 59 percent of the vote, granted app-based rideshare and delivery companies an exception to existing California law to classify their drivers as independent contractors, as well as provided the drivers with additional employee benefits,...
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