California Court Says Uber, Lyft Workers Are Contractors

A California court has ruled that “gig economy” companies such as Uber and Lyft and delivery firm Doordash can continue to treat their workers as independent contractors, overturning a lower court’s decision.

In a 63-page opinion published on Monday a panel of three judges from the 1st District Court of Appeal sided with the state of California and a group representing Uber, Lyft and others in largely upholding Proposition 22, which allows the contractor designation.

“Proposition 22 does not intrude on the Legislature’s workers’ compensation authority or violate the single-subject rule,” the opinion states.

California voters approved Proposition 22 in November 2020 following record-breaking spending by ride-share companies, who contributed more than $181 million (£149m) to the “Yes” campaign, making the ballot issue the most expensive in California’s history.

Image credit: Uber

App-based working

The measure followed shortly after California had moved to force Uber, Lyft and others to classify their workers as employees.

A group of ride-share drivers challenged the proposition’s constitutionality and a lower court found in 2021 that Proposition 22 restricted lawmakers’ powers to set standards in the workplace.

Monday’s decision reverses the lower court’s finding, but removes a clause from Proposition 22 that restricted collective bargaining by workers.

Shares in Uber, Lyft and Doordash rose almost 5 percent in after-hours trading.

“Today’s ruling is a victory for app-based workers and millions of Californians who voted for Prop 22,” said Uber chief legal officer Tony West.


“We’re pleased that the court respected the will of the people and that Prop 22 will remain in place, preserving independence for drivers.”

Lyft said the proposition “protects the independence drivers value and gives them new, historic benefits”.

The Service Employees International Union, which challenged the proposition’s constitutionality with several drivers, said it was considering appealing.

Matthew Broersma

Matt Broersma is a long standing tech freelance, who has worked for Ziff-Davis, ZDnet and other leading publications

Recent Posts

Apple Slashes iPhone Prices In China

Amid intense competition from Huawei and others, Apple has again slashed the price of its…

15 hours ago

Bitcoin ‘Creator’ Craig Wright Repeatedly Lied, Rules UK Judge

Damning ruling by British judge, after he rules that self-proclaimed bitcoin inventor lied 'repeatedly' to…

16 hours ago

Julian Assange Granted Right To Challenge US Extradiction Order

High Court rules Wikileaks founder Julian Assange can appeal against extradition to the US, despite…

17 hours ago

Tesla Layoffs Continue With Another 600 Jobs In California

Regulatory filing last week shows Elon Musk's Tesla is cutting another 600 jobs in California,…

19 hours ago

UK Regulator Declines To Investigate Microsoft’s Mistral AI Deal

Weeks after seeking feedback on Microsoft's partnership with Mistral AI, UK regulator says it does…

22 hours ago

UK AI Safety Institute To Open Office In US

Seeking collaboration on AI regulation, UK's AI Safety Institute to cross Atlantic and will open…

22 hours ago