California’s Highest Court Affirms Lyft and Similar Companies’ Independent-Contractor Model
On July 25, 2024, in a unanimous decision, California’s Supreme Court ruled it was constitutional for companies such as Lyft, Uber and DoorDash to classify their drivers as gig workers, commonly referred to as independent contractors.
(July 25, 2024) - On July 25, 2024, in a unanimous decision, California’s Supreme Court ruled it was constitutional for companies such as Lyft, Uber and DoorDash to classify their drivers as gig workers, commonly referred to as independent contractors.
Specifically, the highest court upheld Proposition 22, a 2020 ballot measure that authorized the classification of drivers as independent contractors rather than as employees. Proposition 22 provided gig workers some benefits but not the full benefits that employees receive. These benefits include guaranteed minimum earnings of 120% of minimum wage, health care stipends, and occupational accident insurance.
The court rejected a challenge by ride-share drivers and unions that Proposition 22 is unconstitutional because of its alleged interference with lawmakers’ authority over workers’ compensation and benefits.
For more information about this decision, contact the authors of this alert. Visit Lewis Brisbois' Transportation Practice page to learn more about our capabilities in this area.\
Authors:
Kathryn Bonorchis, Partner and Vice-Chair of National General Liability Practice
Joelle Grace Nelson, Partner and Co-Chair of National General Liability Practice and Transportation Practice