The state of California has been locked in a fierce battle with Uber, Lyft and a few other companies that rely on “gig” workers for their business model over how they classify their workers for some time.
After several legal twists and turns, Proposition 22 (the App-Based Drivers as Contractors and Labor Policies Initiative) was passed in November. Prop 22 directly addresses that very issue.
What is the purpose of Prop 22?
In essence, Prop 22 was designed to carve out an exemption to an earlier change in the law, known as Assembly Bill 5 (AB 5). AB 5 required companies to apply a three-pronged test when classifying someone. The way the law was written, very few gig workers met the new definition of an independent contractor.
Uber and Lyft weren’t the only companies upset. DoorDash, Instacart, musicians, writers and others were all feeling the pinch of the new law. Thus, Prop 22 was born. Somewhat of a compromise, it allows delivery drivers and ride-hail drivers to remain independent contractors — albeit with a few new benefits (like a guarantee of minimum earnings during their work period).
Does that mean your employer can automatically make you an independent contractor?
No. Prop 22 doesn’t give employers total freedom to classify a worker any way they want. State and federal laws alike limit their abilities. Misclassification is likely to remain a problem, however, as companies increasingly seek to divest themselves of the responsibilities and liabilities employers take on.
If you believe you are being misclassified by your employer and you’ve been denied the benefits you are due, it may be time to take action. An attorney can show you the next steps.