On March 13, the California Court of Appeal mostly upheld Proposition 22, which authorized rideshare and delivery network platforms, such as Uber and Postmates, to classify their workers as independent contractors instead of employees.
On March 17, the U.S. Court of Appeals for the 9th Circuit ruled that these platforms should be given the opportunity to prove they were unconstitutionally excluded from exemptions to California’s independent contractor statute, commonly called Assembly Bill 5.
In Castellanos v. State of California, a split three-justice panel of the California Court of Appeal mostly reversed the trial court’s order. The two-justice majority rejected the claim that Prop. 22 interferes with the Legislature’s authority over California’s workers compensation system. The court held that the state constitution gave both the Legislature and the voters, through the initiative process, authority to revise workers compensation laws.
The 9th Circuit ordered the trial court to allow the app-based rideshare and delivery network platforms to demonstrate that the Legislature excluded them from those industries exempt from the ABC test due to animus instead of reason in violation of the platforms’ constitutional right to equal protection under the law.
The court said the “piecemeal fashion in which the exemptions were granted” suggests the exemptions resulted from “backroom dealing” rather than from an effort to protect worker rights. The court also pointed to the repeated disparaging comments Gonzalez made about the platforms.
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