Gig Worker Rights in California: Prop 22 Pay, Benefits and Misclassification

Part of our California Labor Laws by Job library31 guides→

If you drive for a rideshare or delivery app in California, Proposition 22 generally treats you as an independent contractor, but it guarantees you at least 120% of the minimum wage for “engaged time,” 37 cents for every engaged mile in 2026, a health care stipend if you work enough hours, and accident insurance. If you do other kinds of gig work, Prop 22 does not apply, and California’s ABC test may make you an employee with full wage protections.

Knowing which rule applies is the key to your gig worker rights in California. Prop 22 pays only for the time between accepting and finishing a trip or delivery, so the time you spend waiting for the next request is unpaid. An employee, by contrast, is owed minimum wage for all hours worked, overtime, breaks, expense reimbursement and workers’ compensation.

This guide explains who Prop 22 covers, how the pay floor works, what it does not give you, how the ABC test applies to other gig jobs, and what to do if you think you are being underpaid or misclassified.

Who Prop 22 covers (and who it doesn’t)

Proposition 22, the Protect App-Based Drivers and Services Act, was approved by voters in November 2020 and is codified at Business and Professions Code sections 7448 to 7467. It covers “app-based drivers”: rideshare drivers for transportation network companies and couriers for delivery network companies that let you accept or decline each request through an app.

Under section 7451, an app-based driver is an independent contractor, not an employee, if the company meets four conditions:

• It does not set specific dates, times or a minimum number of hours you must be logged in.
• It does not require you to accept any particular ride or delivery to keep your access to the app.
• It does not stop you from working for other apps, except during engaged time.
• It does not stop you from working in any other lawful job or business.

Prop 22 does not cover gig work outside rideshare and app-based delivery, such as cleaning, moving, handyman jobs, caregiving or warehouse shifts booked through an app. Those workers are usually judged under the ABC test, discussed below.

In Castellanos v. State of California (July 25, 2024), the California Supreme Court unanimously held that section 7451 does not conflict with the Legislature’s constitutional power over workers’ compensation. Prop 22 remains in effect, and the Court noted that, as a result of section 7451, app-based drivers are not covered by California workers’ compensation laws.

By the numbers120%

How the Prop 22 pay floor works

Section 7453 sets a “net earnings floor” that the company must meet for each earnings period of up to 14 days. The floor has two parts:

• Time: 120% of the applicable minimum wage for all engaged time. The applicable minimum wage is the state minimum wage ($16.90 an hour in 2026) or, if the pickup happens in a city or county with a higher general minimum wage, that local rate.
• Miles: a per-mile amount for vehicle expenses times your engaged miles. The State Treasurer’s Office adjusts it each year for inflation; it is $0.37 per engaged mile for 2026.

“Engaged time” runs from when you accept a request until you complete it. It does not include time after a customer cancels or time on a request you abandon. “Engaged miles” are miles driven during engaged time in your own (not company-owned) vehicle.

Your net earnings for the period are compared with the floor. Tips, tolls, cleaning fees and airport fees do not count toward the floor, but incentives and bonuses can. If you fall short, the company must pay the difference no later than the next earnings period. The floor is averaged over the period, so a low-paying trip can be offset by a high-paying one.

💡 Example: Maria delivers in a city where the state minimum wage applies. In one two-week period she logs 25 hours of engaged time and 300 engaged miles. Her floor is 25 × $20.28 (120% of $16.90) = $507.00, plus 300 × $0.37 = $111.00, for a total of $618.00. If her earnings for the period, not counting tips, were $560.00, the company owes her a $58.00 top-up. (Hypothetical.)

Want to see what the floor means for your own hours? Our wage and hour calculator and the California minimum wage by city page can help you find the right local rate.

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Your tips belong to you

Prop 22 has its own tip rule. Under section 7453(c), an app company cannot take, receive or keep any part of a tip a customer leaves for you, and it cannot reduce your pay for a ride or delivery because you received a tip. If customers tip by credit card, you must get the full amount the customer chose, with no deduction for card processing fees.

Because tips do not count toward the earnings floor, a company cannot use your tips to meet its minimum pay obligation.

Health care stipends and accident insurance

Section 7454 requires a quarterly health care stipend for drivers who average enough engaged time on one company’s platform:

Average engaged time per week in the quarter	Stipend
25 hours or more	At least 100% of the “average ACA contribution” for each month
15 to under 25 hours	At least 50% of the average ACA contribution for each month
Under 15 hours	No stipend required

The average ACA contribution is 82% of the average monthly premium for a Covered California bronze plan, which Covered California publishes each year. You must be enrolled in a qualifying plan where you are the subscriber; employer-sponsored plans, Medicare and Medi-Cal do not qualify. The company may ask for proof of enrollment, and you have at least 15 days after the quarter ends to send it. You can receive stipends from more than one company for the same quarter.

Section 7455 also requires companies to provide occupational accident insurance while you are online: at least $1 million in medical coverage and disability payments of 66% of your average weekly earnings for up to the first 104 weeks after an injury, plus accidental death coverage for your dependents.

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Other Prop 22 protections

• A written contract and an appeal. The company must sign a written agreement with you, may end it only for a reason stated in the contract, and must offer an appeals process if you are deactivated (section 7452).
• Anti-discrimination. A company cannot refuse to contract with you, deactivate you or end your contract because of race, religion, sex, age, disability, sexual orientation and other protected traits, unless a narrow exception applies. These claims proceed under the Unruh Civil Rights Act (section 7456).
• Sexual harassment policy. Each company must publish a policy with a complaint process and a ban on retaliation for good-faith complaints (section 7457).
• Driving limits. You cannot be logged in and driving for more than 12 hours in a 24-hour period without a 6-hour break (section 7461).

Key fact

What Prop 22 doesn’t cover

Prop 22 is a floor, not the full set of employee rights. If you are properly classified under Prop 22, you generally do not receive:

• Pay for waiting time between requests
• Overtime, meal breaks or rest breaks under the Labor Code
• Workers’ compensation (accident insurance under section 7455 is the substitute)
• Unemployment insurance through your work for the app
• Full reimbursement of vehicle and phone costs beyond the per-mile amount

Section 7464 also bars cities and counties from setting their own pay, benefit or scheduling rules for app-based drivers, except for local ordinances adopted before October 29, 2019.

One newer change: Assembly Bill 1340 (Chapter 335, Statutes of 2025) added Business and Professions Code section 7470 and following, which gives rideshare drivers for transportation network companies the right to form driver organizations and bargain with the companies through a process run by the Public Employment Relations Board.

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Other gig work: the ABC test and AB 5

If your gig job is not app-based rideshare or delivery, California generally presumes you are an employee. Under Labor Code section 2775, codified by AB 5, a hiring entity must prove all three parts of the ABC test to treat you as an independent contractor:

1. (A) You are free from its control and direction, both under the contract and in fact.
2. (B) Your work is outside the usual course of its business.
3. (C) You are customarily engaged in an independently established trade or business of the same kind.

The Labor Code includes exemptions for certain occupations and business-to-business arrangements, so each job needs a close look. Our guide to independent contractor misclassification and the ABC test walks through the test in detail.

Prop 22’s contractor status also depends on the company meeting the four conditions in section 7451. If an app sets your hours, requires you to accept specific orders, or stops you from using other apps, a lawyer should review whether Prop 22 still applies to you.

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If you’re misclassified: what you can recover

A worker who should have been treated as an employee may be able to recover:

• Unpaid minimum wages and overtime for all hours worked
• Meal and rest break premiums
• Reimbursement of work expenses such as mileage and phone use (Labor Code 2802); see our guide to expense reimbursement
• Paid sick leave, unemployment and disability insurance eligibility, and workers’ compensation if injured; see workers’ comp for misclassified contractors

Willful misclassification also carries civil penalties of $5,000 to $15,000 per violation, or $10,000 to $25,000 per violation for a pattern or practice (Labor Code 226.8).

Wage claims generally must be filed within three years (Code of Civil Procedure 338), or four years when brought under the Unfair Competition Law (Business and Professions Code 17208). Many app and contractor agreements contain arbitration clauses, which can affect where a claim is heard.

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What to do if you think you’re underpaid or misclassified

1. Download your trip and pay history. Save earnings statements, engaged-time and engaged-mile reports, and quarterly health stipend notices. Companies must show you your engaged hours each earnings period.
2. Check the math. Compare your earnings, minus tips, to 120% of the right minimum wage times engaged hours, plus $0.37 per engaged mile.
3. Keep your contract. Save the version you agreed to, any arbitration clause, and any deactivation notices.
4. Document control. Screenshots of required schedules, acceptance-rate threats or exclusivity rules can matter.
5. Use the appeal process if you are deactivated, and keep copies of everything you submit.
6. Talk to a lawyer about whether Prop 22 or the ABC test applies and where a claim should be filed.

For news on recent app-driver cases, see our coverage of Lyft’s settlement with California drivers.

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Frequently asked questions

Does Prop 22 pay me for time waiting between rides or deliveries?

No. The pay floor covers engaged time only, from accepting a request to completing it. Time logged in and waiting is not counted.

Does my city’s higher minimum wage apply to gig worker rights in California?

Yes, for engaged time. The floor uses 120% of the higher local minimum wage when the passenger or item is picked up in a city or county with a general minimum wage above the state rate.

What is the Prop 22 per-mile rate for 2026?

The State Treasurer’s Office set it at $0.37 per engaged mile for 2026. It started at $0.30 in 2021 and is adjusted each year for inflation.

Can I get workers’ compensation if I’m hurt while driving for an app?

Not if you are properly classified under Prop 22. The company’s occupational accident insurance covers medical costs and part of your lost income instead. If you were misclassified, workers’ compensation may apply.

I deliver for one local restaurant, not an app. Am I covered by Prop 22?

Probably not. Prop 22 covers delivery through app-based delivery network companies. A restaurant that hires its own drivers is generally judged under the ABC test, and its drivers are often employees entitled to minimum wage and mileage reimbursement.

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