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Gig Drivers Revive Proposition 22 Challenge in California (2)

Feb. 11, 2021, 7:57 PM; Updated: Feb. 12, 2021, 6:19 PM

The California ballot measure bankrolled by Uber Technologies Inc., Lyft Inc., and DoorDash Inc. that allows their drivers to be classified as independent contractors is unconstitutional, according to a lawsuit refiled in state court on Thursday.

The Service Employees International Union, the SEIU California State Council, and four gig drivers renewed their challenge to Proposition 22 in Alameda Superior Court. The California Supreme Court on Feb. 3 declined to directly take up their case before it worked its way through lower courts.

The lawsuit claims that the voter-approved Proposition 22—which allows gig companies to avoid the state’s stringent “ABC” worker classification test—limits workers’ rights and the power of government officials, and violates specific parts of the California constitution.

For example, the suit claims it limits the legislature’s right to grant workers the right to organize, and keeps drivers from accessing the state’s workers’ compensation program. It also says Proposition 22 violates a constitutional provision that requires ballot initiatives to address only a single subject.

“With Prop 22, Uber, Lyft, Doordash and the other gig giants overreached by writing a law that violates our state’s constitution and puts corporate profits ahead of workers’ safety and basic rights,” one of the plaintiffs, gig driver Saori Okawa, said in a statement.

The groups cite two examples of previous constitutional challenges to ballot measures, including one that denied undocumented immigrants access to basic education and healthcare, and another that denied marriage equality to same-sex couples. Those measures were ultimately struck down through litigation or legislation.

The gig companies spent a record $200 million to fund the ballot initiative that allows their business models to rely on contractors and outlines basic benefits. Employees, unlike contractors, have access to minimum wage, overtime, and healthcare.

The California Attorney General’s Office in Sacramento is defending Proposition 22. Olson Remcho, Altshuler Berzon, and attorneys with the SEIU are representing the unions and workers.

The attorney general’s office said in a statement that it is reviewing the latest filing. The gig companies directed questions to Protect App-Based Drivers & Services, a group that pushed for Proposition 22.

The group provided a statement from an app-based driver Jimmy Strano, who says he wants to be a contractor.

“Special interests have consistently refused to accept the overwhelming desire of drivers to remain independent since it doesn’t fit their political agenda,” Strano said in the statement. “Now, they’re continuing to undermine the will of California voters across the political spectrum who overwhelmingly passed Prop 22. We’re confident these attacks on California voters and our electoral process will continue to be rejected by the courts.”

The case is Castellanos v. California, Cal. Super. Ct., Docket Number Unavailable, petition filed 2/11/21.

(Updated to add comment from the attorney general's office and the interest group that represents gig companies. The story originally published Feb. 11.)

To contact the reporter on this story: Erin Mulvaney in Washington at emulvaney@bloomberglaw.com

To contact the editors responsible for this story: Jay-Anne B. Casuga at jcasuga@bloomberglaw.com; Martha Mueller Neff at mmuellerneff@bloomberglaw.com; Andrew Harris at aharris@bloomberglaw.com

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