[1][2][3][4] The law exempts employers from providing the full suite of mandated employee benefits (which include time-and-a-half for overtime, paid sick time, employer-provided health care, bargaining rights, and unemployment insurance) while instead giving drivers new protections: The initiative became state law after passage in November 2020, was challenged in California state courts in 2021, and was upheld on appeal in 2023 and by the California Supreme Court in 2024.

In 2019, Assembly Bill 5 was passed, and it was designed by lawmakers to require companies to classify ride-hail drivers and other gig-economy workers as "employees".

The court granted an extension until November 4, 2020, on the condition that Uber and Lyft CEOs provide a sworn testimony by October 4 confirming their plan to comply with AB 5.

[17] In an opinion piece in The New York Times, Uber's CEO Dara Khosrowshahi advocated for the legal creation of a third employment classification between the current mutually exclusive classes of "employee" and "independent contractor", claiming it was necessary to allow gig workers to have the flexibility and freedom to fit work into their schedules, while also allowing companies to provide some benefits for them without being forced into the full requirements associated with "employee" classification.

[23]: 1  [24]: 1 [21] Lyft, Uber, DoorDash, Instacart, and Postmates contributed over $205 million into campaigns supporting Prop 22, making it the most expensive ballot measure in California's history.

[28][29] Beyond in-app messaging, this investment manifested itself in billboards, digital, print, and radio ads, as well as dozens of lobbyists and voter mailers.

[31][32] The ballot title, written by Attorney General Xavier Becerra, is "Exempts App-Based Transportation and Delivery Companies from Providing Employee Benefits to Certain Drivers.

Prop 22 instead designated a 7/8 majority as being required to change it,[14] although this provision as would have applied to collective bargaining was removed by an appeals court ruling in March 2023.

[50] According to polling conducted by Tulchin Research, 86% of surveyed drivers are ineligible for Prop 22 Healthcare Stipend and those eligible are largely unaware of how to do sign up, receiving little information from app-based companies.

[55][43][47] The court did sever the proposition's requirement that a seven-eights majority of the legislature was necessary to make changes to worker's options for collective bargaining.

[56] In July 2024, the court unanimously upheld the proposition, saying that the state's constitution does not prevent voters from passing initiatives relating to workers' compensation.

[59][16] In Massachusetts, Uber and Lyft led a bid to introduce a ballot measure that would maintain their drivers' status as independent contractors.

[60] In April 2022, Washington state legislators passed, and the governor signed a bill specifying that ride-share drivers are independent contractors, while also giving them new protections and benefits.