August 30, 2021
What’s Next for Prop 22 and Debates Around Independent Workers?
A California court recently ruled that Proposition 22—a ballot initiative allowing delivery and ride-share drivers to retain their independent worker status—was unconstitutional under the state constitution. In a new insight, AAF’s Jennifer Huddleston and Juan Londoño analyze the problems with worker reclassification and note that Prop 22 demonstrates the difficulty with remedying the consequences of such reclassifications after the fact. Policymakers would do better to avoid these laws altogether, they argue.
Prop 22 sought to address concerns about the impact AB5 [California’s worker reclassification law] would have on certain app-based platforms such as Uber and DoorDash by adding them to the list of exempted industries under AB5, such as truck drivers and another 108 industries. Still, for some of the more creative aspects of the gig economy, worker reclassification can present barriers that raise costs and discourage the use of independent workers. Exemptions only for independent workers performing certain types of services or in certain industries could deter innovators in other, less favored industries from thinking of new opportunities to connect consumers and providers through apps or other technology.