In California, the longstanding battle between legislation and transportation companies may be put to rest after the 2020 election. Back in 2018, the California Supreme Court ruled that all independent workers in the state must be classified as employees unless they meet all of the requirements to be an independent contractor, known as Assembly Bill 5 (AB5).
Trucking companies in California have been able to navigate through AB5 without issue, but this is not the case for app-based transportation companies. In response to AB5, a new ballot measure may assist with this opposition and leaves an important decision to the people of the state.
How Does AB5 Affect Workers?
Since the ruling of AB5, there has been opposition from app-based companies that have always labeled their workers as independent contractors. This mainly challenges ride-share and delivery companies, but they continue to push back and avoid reclassifying their independent workers as employees. Now, these companies have banded together to create a campaign in California which has become Proposition 22.
What is Proposition 22?
This ballot measure will allow workers under these transportation companies to remain independent contractors and also provide them with employment benefits. Proposition 22 will put the choice into the hands of the public. Despite the back and forth between opposing sides, the measure will be on the ballot of this year’s general election in California. Below are benefits for drivers:
- Companies must provide an hourly wage for time spent driving equal to 120% of either a local or statewide minimum wage.
- Drivers receive a stipend for purchasing health insurance coverage when driving time averages at least 15 hours a week; The stipend will grow larger if average driving time rises to 25 hours a week.
Work hours will only include time spent driving to, picking up, and transporting a passenger or delivery to a destination. It will not count the time spent in between trips.
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