In a pivotal court case concerning California labor laws, an en banc panel of 11 judges of the Ninth Circuit, predominately appointed by Democratic presidents, appeared receptive to the state’s defense of Assembly Bill 5. The legislation, enacted in 2019, mandates that companies like Uber provide full employment benefits to their workers, effectively challenging the gig economy business model.
The San Francisco-based federal appellate court listened to arguments regarding AB 5’s constitutionality. The law’s exemptions for certain professions have been a focal point, with the state arguing that the statute does not unfairly target the ride-hailing giant.
The panel, composed of appointees from four different presidential administrations, wrestled with issues concerning California legislators’ rationale in exempting various professionals from AB 5 and the extent to which the court should scrutinize the legislature’s motives.
Judge Gabriel Sanchez noted the Supreme Court’s standard, suggesting that courts need only find a reasonably conceivable basis for the legislation to withstand rational basis scrutiny.
While some California lawmakers have publicly criticized gig-economy companies, arguments in court maintained that the heated rhetoric was an offshoot of a fiercely debated topic.
The judges’ questions indicated an inclination toward accepting California’s justification for addressing labor misclassification issues prevalent in ride-sharing and delivery service industries, suggesting that the law’s objectives might overshadow the debate around its exemption criteria.
Source: Courthouse News Service