The California Supreme Court in CASTELLANOS v. STATE OF CALIFORNIA (Case: S279622) is presented with the question that does Business and Professions Code section 7451, which was enacted by Proposition 22 (the “Protect App-Based Drivers and Services Act”), conflict with article XIV, section 4 of the California Constitution and therefore require that Proposition 22, by its own terms, be deemed invalid in its entirety?

The Proposition 22 was was a ballot initiative in California that became law after the November 2020 state election, passing with 59% of the vote and granting app-based transportation and delivery companies an exception to Assembly Bill 5 by classifying their drivers as “independent contractors“, rather than “employees”.The law exempts employers from providing the full suite of mandated employee benefits (which include time-and-a-half for overtime, paid sick time, employer-provided health care, bargaining rights, and unemployment insurance) while instead giving drivers new protections:

  • 120 percent of the local minimum wage for each hour a driver spends driving (with passenger or en route), but not for time spent waiting
  • $0.30/mile for expenses for each mile driven with passenger or en route
  • health insurance stipend for drivers who average more than 15 hours per week driving
  • requiring the companies to pay medical costs and some lost income for drivers hurt while driving or waiting
  • prohibiting workplace discrimination and requiring that companies develop sexual harassment policies, conduct criminal background checks, and mandate safety training for drivers.

The initiative became state law after passage in November 2020, was challenged in California state courts in 2021, and was upheld on appeal in 2023. Proposition 22 awaits a California Supreme Court decision on its constitutionality. (Wikipedia)