Opinion: Uber’s reopening of its California workforce is just the beginning

In a stunning decision Friday, reflecting nearly 90 years of Supreme Court rulings, the U.S. 9th Circuit Court of Appeals allowed a constitutional challenge to Assembly Bill 5, California’s 2019 law protecting low-wage workers.

The ruling is particularly shocking and concerning because the same court rejected the exact same challenge to the same law in 2021. The reversal of Friday’s decision is likely to open the door to constitutional challenges to numerous state business regulations.

the case, Olson vs. the State of Californiawas brought forward by Uber and Postmates to challenge AB 5’s claims that those companies’ drivers are not treated as independent contractors, but as employees protected by minimum wage, overtime, workers’ compensation, unemployment insurance and anti-discrimination laws.

In a 2018 case involving truck drivers, the California Supreme Court passed a three-step test to determine an employee’s status under the state’s wage and labor laws. Lawmakers, with AB 5, codified and expanded this test to cover most low-wage and low-skill jobs, including app-based drivers, warehouse workers and other industries where lawmakers found companies misusing the independent contractor designation.

It’s a complicated legal landscape since California voters passed Proposition 22 in 2020, which grants app-based ride-hailing and delivery companies an exemption from AB 5, allowing them to continue classifying their drivers as independent contractors. However, AB 5 still applies to all other California employees. Irrespective of the constitutionality of proposal 22 remains in dispute and will likely have to be decided by the state Supreme Court.

2021, in the American Association of Journalists and Writers, Inc. F Bonta, the 9th Circuit specifically rejected the argument that AB 5 denies equal protection because it treats some employees differently than others. The court ruled, after nearly 90 years of Supreme Court precedent, that “states are given a lot of leeway in managing their economies.”

So the court’s recent ruling – on the same issue of regulating performance-based companies – is true inexplicable. This time, Uber and other concert companies argued that AB 5 unconstitutionally discriminated against them because it exempted other professions such as doctors, lawyers, graphic artists and beauticians.

The Los Angeles Federal District Court dismissed the Olson case, ruling that the government has broad powers to make regulatory decisions. Indeed, since 1937, the Supreme Court has never struck down a procedural rule because it violated the Equal Protection Clause of the Constitution.

For example, in 1976 the court A New Orleans law was ratified Banned the wheelbarrow sellers in the French Quarter, except those who had been there for at least eight years. 1956 court Passed a law in Oklahoma banning optometrists by to tamescary lenses, even to replace broken lenses without a prescription from an optometrist or optometrist. The court has long stressed that the Constitution does not prevent legislators from discriminating between companies, even if the laws are ill-advised or imperfect.

Oddly enough, the 9th Circuit in Olson ruled that the performance companies could challenge AB 5 on the grounds that the law “creates animosity rather than reason.” The court focused on statements by AB 5’s main sponsor, former Representative Lorena Gonzalez, who criticized the employment practices of app-based ride-hailing and delivery companies.

(The court has repeatedly referred to these companies as a “politically unpopular group” targeted by the California legislature, never mentioning that these companies successfully persuaded California voters to pass Proposition 22 to remove them from AB 5 cannot be ruled out.)

If this analysis is accepted, any law regulating businesses could be challenged on the grounds that it violates the same protections if the sponsor of the bill identifies particularly harmful practices as the basis for legislative action.

Imagine a legislator concerned about toxic pollution from one type of industry and trying to regulate it, while other types of pollution from other industries remain unregulated. Exposure to the environmental hazard can be called “animus” and the regulation can be seen as a denial of the same protections.

The state legislature has the authority to recognize and regulate particularly harmful business practices. This is not “animus”, but the essential role of the legislature.

With the passing of AB 5, the California legislature concluded that there had been significant employee abuse by companies operating app-based ride-hailing and delivery services. His approach was not arbitrary; The law implements a meaningful test formulated by the California Supreme Court.

For decades, conservatives have advocated judicial restraint and respect for the political process. But that doesn’t seem to apply if they don’t like government regulation of the economy. They will certainly use the new 9th Federal Court decision and its flawed reasoning to challenge numerous important regulations needed to protect workers and consumers.

Erwin Chemerinsky is author of Opinion and dean of the UC Berkeley School of Law. Catherine Fisk is a professor at the UC Berkeley School of Law.