The state Supreme Court unanimously upheld a voter-approved law that allows gig companies to classify their drivers as independent contractors.
The decision is a big win for ride-hailing companies like Uber and Lyft.
Proposition 22 let companies operate the way they always have treating drivers as independent contractors rather than employees.
"This proposition has been in effect since it passed in 2020, so it's not going to dramatically change what the workers have been living with," said David Levine, a professor of law at the University of California College of Law San Francisco.
Levine said it has been a long road for Proposition 22.
"They had drivers who said we don't want to be classified as independent contractors in their perception," Levine said. "It harms them because they don't have access to a number of benefits that an employee has, and in this particular case the issue was access to workers compensation benefits."
The argument centered around whether Proposition 22 violates part of the state constitution, but the justices all agreed it does not.
In a statement, SEIU said "Today's ruling only strengthens our demand for the right to join together in a union so that we can begin improving the gig economy for our workers and our customers."
Reaction from some drivers on Thursday were mixed. While some prefer to be considered an employee, others felt differently.
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In a statement, Lyft said in part, "We are thrilled that the California Supreme Court unanimously upheld the Democratic will of the voters and did what's right for California's communities and economy."
Uber wrote "Whether drivers or couriers choose to earn just a few hours a week or more, their freedom to work when and how they want is firmly not etched in California law."
