KEY POINTS
  • In Nov. 2020, California voters approved Proposition 22, which allowed ride-sharing apps like Uber and Lyft to classify their drivers as independent contractors, limiting the companies' obligation to provide certain benefits.
  • A group of drivers challenged the proposition, and in 2021 a judge said it was unconstitutional.
  • But on Monday, an appeals court overturned that ruling, allowing Prop. 22 to stand.

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Ride-sharing apps, including Uber and Lyft, can continue to treat their drivers as independent contractors, a California appeals court ruled on Monday, overturning a lower-court decision that barred them from doing so.

In Nov. 2020, California voters approved Proposition 22, which allowed ride-sharing and delivery app makers to classify their drivers as independent contractors. A California judge ruled the proposition unconstitutional in 2021, arguing that it infringed the legislature's power to set standards at the workplace. The state and a group representing the companies and other parties appealed that decision, and Monday's ruling came down in their favor.

In this article