Group moves to revive gig-driver exemption from Calif. law

(Reuters) - A coalition of businesses and "gig economy" drivers have appealed a California state judge's ruling that a ballot measure exempting gig drivers from the state's strict worker classification law is invalid.

The group, Protect App-Based Drivers and Services, filed a notice of appeal on Wednesday after the judge in an August decision said the measure, known as Prop 22, violated the state constitution because it limited the legislature's power to include gig drivers within the scope of California workers' compensation law.

The California Attorney General's office filed a separate notice of appeal on Tuesday.

Prop 22 was approved last November by nearly 60% of voters in California. The measure exempted app-based drivers from a 2019 state law known as AB5 that makes it difficult to classify workers as independent contractors rather than employees.

Geoff Vetter, a spokesman for Protect App-Based Drivers and Services, said the group filed the appeal "to protect the overwhelming will of California voters and the desire of app-based drivers to work as independent contractors."

The group was permitted to intervene in the lawsuit challenging Prop 22, which was filed by the Service Employees International Union and several gig drivers.

One of the plaintiffs, Saori Okawa, said it was "heartbreaking" that gig firms have chosen to fund efforts to uphold Prop 22 rather than invest in their workers.

"The gig companies' decision to continue to deny us basic rights and protections is especially appalling as thousands of drivers like me have continued to work through the pandemic," Okawa said in a statement provided by SEIU.

Gig economy companies such as Uber, Lyft, Doordash and Instacart lobbied heavily in favor of keeping drivers' independent contractor status, saying a majority of their workers enjoy the flexibility that comes with not being an employee.

The independent contractor model allows companies to contain costs, as employees are entitled to the minimum wage, overtime pay, reimbursements for expenses and other legal protections.

The case is Castellanos v. State of California, California Superior Court, Alameda County, No. RG21088725.

For the plaintiffs: Stephen Berzon of Altshuler Berzon

For the state: Jose Zelidon-Zepeda of the California Attorney General's office

For Protect App-Based Drivers: Sean Welch of Nielsen Merksamer Parrinello Gross & Leoni

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