A California law classifying Uber and other ride-hail and delivery drivers as employees rather than independent contractors is constitutional, the U.S. 9th Circuit Court of Appeals ruled Monday. The effect of the decision on the companies' operations and the broader gig economy in California wasn't immediately clear, given ongoing litigation over a subsequent, voter-backed proposition that exempted app-based drivers from the employee classification.
But they downplayed the impact of the ruling on their operations in the state, given the passage in 2020 of Proposition 22, which allowed for their drivers to be classified as contractors. Theane Evangelis, an attorney for the companies, said AB5 had 'threatened to take away the flexible work opportunities of hundreds of thousands of Californians,' but voters had 'rejected' such regulations with the proposition.
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