California Court of Appeal
Castellanos v. State of California
A1636550 citations·
Summary of the case Castellanos v. State of California
In Castellanos v. State of California, the plaintiffs challenged Proposition 22, arguing it violated the California Constitution. The trial court ruled the proposition invalid for intruding on legislative authority and violating the single-subject rule. On appeal, the court found Proposition 22 did not infringe on legislative authority or the single-subject rule but did violate separation of powers principles regarding amendments. The unconstitutional provisions were severable, leading to a partial affirmation and reversal of the trial court's decision.
Key Issues of the case Castellanos v. State of California
- Validity of Proposition 22 under the California Constitution
- Separation of powers and amendment provisions
Key Facts of the case Castellanos v. State of California
- Proposition 22 was approved by voters in November 2020.
- The trial court ruled Proposition 22 invalid for intruding on legislative authority and violating the single-subject rule.
Decision of the case Castellanos v. State of California
The court affirmed the judgment declaring certain provisions invalid and reversed other parts.
Opinions
Filed 3/13/23
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION FOUR
HECTOR CASTELLANOS
et al.,
Plaintiffs and A163655
Respondents,
(Alameda County
v. Super. Ct. No.
STATE OF CALIFORNIA RG21088725)
et al.,
Defendants and
Appellants,
PROTECT APP-BASED
DRIVERS AND SERVICES
et al.,
Interveners and
Appellants.
In November 2020, the voters approved Proposition 22, the
Protect App-Based Drivers and Services Act (Proposition 22).
(Bus. & Prof. Code, 1 §§ 7448–7467, as added by Prop. 22,
approved by the voters at Gen. Elec. (Nov. 3, 2020).) Shortly
afterwards, Hector Castellanos, Joseph Delgado, Saori Okawa,
Michael Robinson, Service Employees International Union
Undesignated statutory citations are to the Business and
1
Professions Code.
1
California State Council, and Service Employees International
Union (SEIU; collectively, plaintiffs) filed a petition for writ of
mandate seeking a declaration that Proposition 22 is invalid
because it violates the California Constitution. 2 The trial court
granted the petition, ruling that the proposition (1) is invalid in
its entirety because it intrudes on the Legislature’s exclusive
authority to create workers’ compensation laws; (2) is invalid to
the extent that it limits the Legislature’s authority to enact
legislation that would not constitute an amendment to
Proposition 22, and (3) is invalid in its entirety because it violates
the single-subject rule for initiative statutes.
Proposition 22’s proponents and the state appeal, arguing
the trial court was mistaken on all three points. We agree that
Proposition 22 does not intrude on the Legislature’s workers’
compensation authority or violate the single-subject rule, but we
conclude that the initiative’s definition of what constitutes an
amendment violates separation of powers principles. Because the
unconstitutional provisions can be severed from the rest of the
initiative, we affirm the judgment insofar as it declares those
provisions invalid and to the extent the trial court retained
jurisdiction to consider an award of attorney’s fees, and otherwise
reverse.
BACKGROUND
In 2019, the Legislature enacted Assembly Bill No. 5
(2019–2020 Reg. Sess.), which established a new test for
2Undesignated citations to constitutional articles and
sections are to the California Constitution.
2
distinguishing between employees and independent contractors
for the purposes of the Labor Code and Unemployment Insurance
Code. (Stats. 2019, ch. 296; Lab. Code, § 2775, subd. (b)(1);
People v. Uber Technologies, Inc. (2020) 56 Cal.App.5th 266, 274–
277 [describing background of statute].)
In response, Davis White and Keith Yandell, supported by
a group called Protect App-Based Drivers and Services (Protect
Drivers; collectively, interveners), proposed Proposition 22.
(§ 7449, subd. (d).) An “[a]pp-based driver” is a person who works
as a driver or courier for transportation or delivery network
companies, which are businesses that operate transportation or
delivery services using an electronic application or platform to
connect passengers seeking transportation or customers seeking
delivery of goods to drivers or couriers willing to provide those
services with their personal vehicles. (§ 7463, subds. (a), (f), (i),
(q).) Among the supporters of Protect Drivers and Proposition 22
were rideshare and delivery network companies such as Uber
Technologies, Inc., Lyft, Inc., and DoorDash, Inc.
When interveners requested a title and summary of the
measure so they could gather the necessary signatures to qualify
it for the ballot, the Attorney General gave it the title “Changes
Employment Classification Rules for App-Based Transportation
and Delivery Drivers.” The Attorney General later modified the
title for the purposes of the voter information guide, titling it
“Exempts App-Based Transportation and Delivery Companies
from Providing Employee Benefits to Certain Drivers.” (Voter
Information Guide, Gen. Elec. (Nov. 3, 2020) title and summary
3
of Prop. 22, p. 56 (Voter Guide).) White and Protect Drivers filed
a petition for writ of mandate in Sacramento County Superior
Court to compel the Attorney General to revise the title and
summary, but that court denied the petition.
Proposition 22 added sections 7448 to 7467 to the Business
and Professions Code. (Proposition 22, § 1, available at
[as of Mar. 13, 2023].) The
California Supreme Court held in 1922 that these words did not
7
What this means here, as a practical matter, is that there
is a minimum constitutional baseline to our workers’
compensation system no statute can go below. If, after adoption
of article XIV, section 4—which codified in the Constitution itself
what a “complete system of workers’ compensation” meant prior
to 1918—the Legislature had attempted to create a different
statutory scheme by lopping off some of the “basic features” of
that system (Mathews, supra, 6 Cal.3d at p. 735), the statute
would have been invalid. Nothing could be more “basic” to the
system of workers’ compensation than the scope of the
“employment” relationship. Because Proposition 22 attempts to
redefine that term in a manner that is contrary to the laws of
workplace accident protection as “those laws . . . have existed
since 1911” (Mathews, at p. 735), I believe it is unconstitutional.
B. Article XIV, Section 4, Has Continuing Vitality Today
Insisting upon a narrow reading that gives article XIV,
section 4, no contemporary substance at all, the Attorney General
and the interveners (collectively, the Proposition 22 proponents)
authorize payment of compensation benefits to a state fund if the
worker died without dependents (Yosemite Lumber, supra,
187 Cal. at p. 782), a holding that was later extended to
invalidate awards to the estates of deceased workers (see
Commercial Cas. Ins. Co. v. Industrial Acc. Com. (1930) 211 Cal.
210, 215). Many years later, the voters amended article XIV,
section 4, to allow the Legislature to authorize payment of a
compensation award for a worker who dies without dependents
either to the state (Prop. 13, approved by the voters, Gen. Elec.
(Nov. 7, 1972); see Six Flags, supra, 145 Cal.App.4th at p. 97), or
to the worker’s estate (Prop. 14, approved by the voters, Prim.
Elec. (June 8, 1976)).
8
cite Mathews for the idea that the only purpose of article XIV,
section 4, was to provide constitutional armor against judicial
invalidation by Lochner era courts. 7 While there is a grain of
truth to this line of argument, the Proposition 22 proponents take
the idea too far. Our Supreme Court has indeed recognized that
the “sole purpose” of article XIV, section 4, was to put to rest “all
doubts” about the constitutionality of the existing statutory
workers’ compensation scheme in 1918. (Mathews, supra,
6 Cal.3d at p. 734; City and County of San Francisco v. Workers’
Comp. Appeals Bd. (1978) 22 Cal.3d 103, 114.) But the Mathews
court said nothing about Lochner or Lochnerism, and
understandably so, because there is considerably more to the
origin story of article XIV, section 4, than that.
For proper perspective, some historical background is
necessary. By 1918, our Legislature had passed three versions of
a statutory workers’ compensation scheme, each building on the
last one in sequence. These schemes—which were viewed as
“radical,” even “revolutionary,” at the time (Western Indemnity
Co. v. Pillsbury (1915) 170 Cal. 686, 692 (Western Indemnity I ))—
eliminated employers’ common law tort defenses against
employee workplace accident claims and created an
administrative system for adjudicating and enforcing such claims
on a no-fault liability basis. The first, passed in 1911 and known
as the Roseville Act (Stats. 1911, ch. 399, §§ 1–31, pp. 796–806),
7See Lochner v. New York (1905) 198 U.S. 45, disapproved,
West Coast Hotel Co. v. Parrish (1937) 300 U.S. 379.
9
was purely voluntary; the second, passed in 1913 and known as
the Boynton Act (Stats. 1913, ch. 176, §§ 1–92, pp. 279–320), was
compulsory. Refinements were made in the “workmen’s
compensation, insurance and safety act of 1917” (Stats. 1917,
ch. 586, §§ 1–74, pp. 831–879 (the 1917 Act)), which partially
repealed and restated the Boynton Act (1917 Act, at
pp. 831–832). 8 This series of enactments reflected the cumulative
statutory evolution of the pre-1918 workers’ compensation
system. These statutes are what the Mathews court refers to
when it speaks of the “basic features of those laws as they have
existed since 1911.” (Mathews, supra, 6 Cal. 3d at p. 735.) 9
Article XIV, section 4, evolved along a parallel path, also in
two steps. First, by ballot initiative in 1911—in fact, at the same
special election that brought us the powers of initiative,
8 The current workers’ compensation statutory scheme
appears in the Labor Code. (King v. CompPartners, Inc. (2018)
5 Cal.5th 1039, 1046 [“First created more than a century ago,
California’s workers’ compensation system is now governed by
the Workers’ Compensation Act (WCA; Lab. Code, § 3200 et seq.),
‘a comprehensive statutory scheme governing compensation given
to California employees for injuries incurred in the course and
scope of their employment.’ ”].)
9 The majority opinion appears to question whether the
Mathews and Hustedt courts actually meant what they said in
stating that the language of article XIV, section 4, codified the
“basic features” of the pre-1918 statutory scheme. (Maj. opn.,
ante, at p. 22, fn. 10.) But the constitutional language—which
these courts were simply describing when they said article XIV,
section 4, outlines the “basic features” of a “complete system of
workers’ compensation” (Hustedt, supra, 30 Cal.3d at pp. 342–
343, fns. 10 & 11)—speaks for itself.
10
referendum and recall—the voters laid a constitutional
foundation for the Roseville Act by adding former article XX,
section 21, to the Constitution. Framed in abbreviated language
compared to what later became article XIV, section 4, as we now
know it, that amendment gave the Legislature plenary power to
create and enforce a system of liability without fault for workers
injured in the workplace. Second, seven years later, in November
1918, the Legislature by joint resolution proposed the adoption of
an amendment to the 1911 version of former article XX,
section 21 (Mathews, supra, 6 Cal.3d at p. 733), this time adding
much greater specificity and detail. The 1918 amendment
augmenting former article XX, section 21, is in all material
respects what we now have in article XIV, section 4.
The amended language adopted in 1918 delineates with
particularity the Legislature’s authority to make “adequate
provisions” for relieving workers and their families of the
“consequences of any injury or death incurred or sustained by
workmen in the course of their employment, irrespective of the
fault of any party”; “full provision for securing safety in places of
employment”; “full provision for such medical, surgical, hospital
and other remedial treatment as is requisite to cure and relieve
from the effects of such injury”; “full provision for adequate
insurance coverage against liability to pay or furnish
compensation”; “full provision for otherwise securing the payment
of compensation”; and “full provision for vesting power, authority
and jurisdiction in an administrative body with all the requisite
governmental functions to determine any dispute or matter
11
arising under such legislation, . . .” (Former art. XX, § 21,
amended by Prop. 23, Gen. Election (Nov. 5, 1918).)
Of particular significance here—because this reflects the
superior position article XIV, section 4, enjoys relative to other
provisions within the Constitution, as well as the preeminent role
the Legislature has in making “social public policy” pertaining to
workers’ compensation vis-à-vis other governmental actors—the
amended language makes clear for the first time that (1) the
Legislature’s “plenary” power to do all of the above-listed things
is “unlimited by any provision of this constitution” and (2) the
“social public policy” reflected in the system of workers’
compensation established by the Legislature pursuant to this
authority is “binding upon all departments of the state
government.” (Former art. XX, § 21, amended by Prop. 23, Gen.
Election (Nov. 5, 1918).)
Stepping back for a moment to understand why a second
ballot amendment was necessary in 1918, we must look to case
law developments. In 1915, our Supreme Court upheld the
Boynton Act against constitutional attack in Western Indemnity I
over a vigorous dissent by Justice Henshaw, who predicted that
“the decision in this case will doubtless pass under the scrutiny of
the supreme court of the United States” (Western Indemnity I,
supra, 170 Cal. at p. 721 (dis. opn. of Henshaw, J.)). The
Henshaw dissent in Western Indemnity I was wide-ranging.
It attacked the Boynton Act as an unreasonable exercise of the
police power—a classic Lochner-style substantive due process
12
argument 10—but it raised equal protection and takings clause
issues as well. 11 A concurring opinion by Justice Shaw took the
position that the no fault liability provisions of the Boynton Act
were sustainable under the taxing power, but agreed that, in a
case where an employee’s injury was brought about by his own
negligence, the application of the Boynton Act would constitute
“an attempt to take private property from the owner for the
private use of another person . . . without lawful excuse or right
and without compensation.” (Western Indemnity I, supra, at
p. 735 (conc. opn. dubitante of Shaw, J., on rehg. den.)
Perhaps most importantly, the concurrence and the dissent
in Western Indemnity I together cast doubt on whether former
article XX, section 21, provided adequate support for the Boynton
Act as a matter of state law. 12 Justice Henshaw, who saw the
Boynton Act as an exercise in “socialistic paternalism” (Western
10 Western Indemnity I, supra, 170 Cal. at pages 711–716;
see Ives v. South Buffalo Ry. Co. (1911) 201 N.Y. 271 citing and
relying on Lochner v. New York, supra, 198 U.S. 45, disapproved,
West Coast Hotel Co. v. Parrish, supra, 300 U.S. 379, to
invalidate New York’s workers’ compensation statute.
11 Western Indemnity I, supra, 170 Cal. at page 716 (the
statute is “obnoxious to the constitutional provisions
guaranteeing equal protection . . . and forbidding confiscation”).
12 Western Indemnity I, supra, 170 Cal. at page 729
(dis. opn. of Henshaw, J.) (Boynton Act exceeds the Legislature’s
powers under former article XX, section 21, as adopted in 1911);
cf. Western Indemnity I, at page 735 (conc. opn. dubitante of
Shaw, J., on rehg. den.) (combination of taxing power and police
power insufficient to save Boynton Act from constitutional
invalidity where employee fault implicated in his own injury).
13
Indemnity I, supra, 170 Cal. at p. 724), articulated this view most
forcefully. His dissent hammered away at the theme that the
basis for the Boynton Act was not an exercise of the police power
at all, but instead was an unbridled expression of sovereign “fiat”
(Western Indemnity I, at p. 710 (dis. opn. of Henshaw, J.)) that
“places upon the employer, to the peril of his welfare and the loss
of all his property, the performance of a duty resting upon the
state itself.” (Id. at p. 723.) According to Justice Henshaw, the
“[l]egislature mistakenly put on this constitutional grant” a vast
and oppressive power that went well beyond its “declared limits.”
(Id. at p. 729.)
This backdrop in the California Supreme Court is
important here, but just as relevant are developments prior to
1918 in the United States Supreme Court. While concerns about
potential constitutional invalidation as a matter of substantive
due process under the United States Constitution were real in
1915, as Justice Henshaw’s dissent demonstrates, those concerns
had largely evaporated by 1918. The prediction of a grant of
certiorari in Western Indemnity I did not come true, and in a trio
of cases decided in the high court’s 1917 term, that court
addressed—and rejected—Lochner challenges to statutory
workers’ compensation systems of different kinds. (See Mountain
Timber Co. v. State of Washington (1917) 243 U.S. 219 [voluntary
scheme]; Hawkins v. Bleakly (1917) 243 U.S. 210 [voluntary
scheme]; New York Cent. R. Co. v. White (1917) 243 U.S. 188
14
[compulsory scheme].) White, in particular, was a turning point,
since it dealt with a compulsory scheme similar to California’s. 13
At both the federal and state level, what this brief review of
the pertinent case law shows is that, by the time the proposed
amendment to revise former article XX, section 21, came on the
ballot in November 1918, it was not Lochner that cast
constitutional doubt on California’s statutory workers’
compensation scheme. Rather, the source of doubt was the split
of opinion in Western Indemnity I over the adequacy of former
article XX, section 21, as a state constitutional foundation for
California’s workers’ compensation scheme. Given the state of
the law at the time, the 1918 amendment sought to bolster and
enhance the language of former article XX, section 21, as
originally adopted in 1911, in direct response to the Henshaw
view that that grant of lawmaking power was limitless and
unbounded. The objective was to anchor article XIV, section 4,
13 Following the decisions in these cases, in June of 1919
the high court brushed aside another attempt to challenge a state
workers’ compensation statute on substantive due process
grounds with the following words: “In view of our recent
decisions sustaining state laws imposing upon employers in the
hazardous industries responsibility in one form or another for the
consequences of injuries received by employees in the course of
the employment in the absence of fault on the employer’s part
. . . , little need now be said.” (New York Cent. R. Co. v. Bianc
(1919) 250 U.S. 596, 601 [citing New York Cent. R. Co. v. White,
supra, 243 U.S. 188 and Mountain Timber Co. v. State of
Washington, supra, 243 U.S. 219, among other cases].)
15
more strongly in our Constitution, independently of the police
power. 14
Accordingly, while it is true that the purpose of the 1918
amendment was to “remove all doubts as to the constitutionality
of then existing workmen’s compensation laws” (Mathews, supra,
6 Cal.3d at p. 733)—a remark which must be understood against
the backdrop of what the remaining doubts were when voters
went to the polls—it is an overstatement to go a step further and
suggest that the demise of Lochnerism in the mid-1930’s
transformed article XIV, section 4, into a constitutional dead
letter. In service of an argument that article XIV, section 4, may
safely be ignored today, that account of what happened places a
convenient expiration date on this provision of the Constitution.
But it is incomplete and misleading as history.
For proof, we need look no further than the cases
construing article XIV, section 4, to put substantive limitations
14 In the modern terminology of United States Supreme
Court jurisdiction, this would be called an effort to insulate the
decision in Western Indemnity I against federal constitutional
attack—on any ground—by ensuring that the vehicle for such a
future challenge would be a California decision resting on
“adequate and independent state grounds.” (E.g., Republican
Nat. Committee v. Burton (1982) 455 U.S. 1301, 1302.) As a
recipe to ward off federal review, this is not a theory I am reading
into the case law based on hindsight. It is a strategy that
actually played out in a case involving Arizona’s workers’
compensation scheme, where, just as we see with article XIV,
section 4, the challenged statute was based on a specific grant of
lawmaking power in that state’s constitution. (See Arizona
Employers’ Liability Cases (1919) 250 U.S. 400, 417–419.)
16
on legislative power, dating from as early as 1922 (Yosemite
Lumber, supra, 187 Cal. 774) to as recently as 1981 (Hustedt,
supra, 30 Cal.3d 329) and even more recently, 2006 (Six Flags,
supra, 145 Cal.App.4th 91), long after Lochner was gone. If we
take stock of the full history, article XIV, section 4, remains as
vital today as it was when adopted in 1918. It should be treated
with the seriousness and dignity it deserves as one of several
enduring constitutional achievements of the progressive reform
era, along with and adjacent to the powers of direct democracy.
Here, what that means is we must stand ready to strike down
any statute that exceeds the outer limits of legislative power
established by article XIV, section 4. I believe Proposition 22
crosses that line.
C. This Case Presents the Conflict of Legislative Powers
Issue Anticipated in Footnote 9 of the Supreme
Court’s Opinion in Independent Energy Producers
Assn. v. McPherson
1. The Conflict Here Is Between Concurrent Powers,
Not Coextensive Powers
Although the most glaring constitutional violation
presented here is the use of a ballot initiative to effect what
amounts to an amendment of the Constitution, a second, related
article XIV, section 4, violation requires the invalidation of
Proposition 22.
By placing the eligibility of app-based drivers for workers’
compensation benefits off-limits to amendment by the
Legislature, Proposition 22 seeks to override constitutional
responsibility delegated to the Legislature. The Proposition 22
17
proponents contend that, in striking the initiative down on that
basis, the trial court erred by construing the term “plenary” as
“exclusive.” This is not an accurate characterization of the trial
court’s ruling. The trial court saw a conflict between article XIV,
section 4, and article II, section 10(c), and resolved it in favor of
the Legislature. I believe it was correct to do so.
The deficiency I see here is structural. The delegated
power we are dealing with—the power to carry out a specific
constitutional task (i.e., to establish and maintain a “complete
system of workers’ compensation”)—was conferred on “the
Legislature” under article XIV, section 4, not on the voters acting
as “electors.” Because voter “electors” and the “Legislature”
share the police power, they may each legislate on the subject of
workers’ compensation, which is why our Supreme Court has
held that the article II, section 8(a) power to adopt initiative
statutes is “encompass[ed]” within the Legislature’s article XIV,
section 4 power. (McPherson, supra, 38 Cal.4th at p. 1025.)
But as the trial court correctly concluded, when voter
electors exercise the police power in a way that comes into
conflict with the Legislature’s article XIV, section 4, power, we
have the dilemma the Supreme Court flagged in footnote 9 of its
McPherson opinion. (McPherson, supra, 38 Cal.4th at p. 1044,
fn. 9.) In that footnote, the court carefully left open issues that
may be raised in a scenario where an initiative statute
“improperly conflicts with the Legislature’s exercise of its
authority” under a specific delegation of legislative power in the
Constitution. (McPherson, at p. 1044, fn. 9., original italics.)
18
Emphasizing that we must liberally construe the people’s
“initiative power” (Legislature v. Eu (1991) 54 Cal.3d 492, 501)
and “resolve any reasonable doubts in favor” of this right
(Brosnahan v. Brown (1982) 32 Cal.3d 236, 241, italics omitted),
the Proposition 22 proponents tell us there is no genuine conflict
here because the legislative power of the voters is at least
coextensive with and in some respects “greater than that of the
Legislature” (Rossi v. Brown (1995) 9 Cal.4th 688, 704). But
because we are dealing with a ballot statute that treads on a
constitutionally delegated power assigned specifically to the
Legislature, sweeping statements about the people’s “precious
rights” of initiative (Amador Valley Joint Union High Sch. Dist.
v. State Bd. of Equalization (1978) 22 Cal.3d 208, 248) provide
little guidance.
Precision is crucial. Voter electors are not the “people”
when they legislate under article II, section 8(a). They exercise
sovereign power as the “people” only when they approve ballot
constitutional amendments. Although voter electors and the
Legislature may both exercise the police power to pass
legislation, and ordinarily the electors have the upper hand when
both wish to legislate on the same subject (art. II, § 10(c); People
v. Kelly (2010) 47 Cal.4th 1008), this is not an ordinary case. The
power exercised by voter electors under article II, section 8(a),
and the power exercised by the Legislature under article XIV,
section 4, overlap, but these two powers remain distinct, as the
history of article XIV, section 4, recounted above shows. Nothing
in McPherson holds to the contrary. The McPherson court
19
pointed out that the electors’ ability to adopt statutes by
initiative is a “similar power” to that of the Legislature under
article XII, section 5 (McPherson, supra, 38 Cal.4th at p. 1033),
not that the electors are “the Legislature” when they legislate on
workers’ compensation matters, having simply stepped into the
shoes of the Legislature, clothed with article XII, section 5,
authority.
Because only the Legislature has the constitutional power
to act “pursuant to” article XIV, section 4 (Graczyk v. Workers’
Comp. Appeals Bd. (1986) 184 Cal.App.3d 997, 1008), I believe
the most accurate way to describe these two powers when they
conflict is that they are concurrent, not that they are coextensive.
(See Youngstown Sheet & Tube Co. v. Sawyer (1952) 343 U.S.
579, 637–638 (Youngstown Sheet & Tube) (conc. opn. of
Jackson, J.).) The friction generated by a direct clash of two
concurrent legislative powers within our basic plan of
government presents a rare and difficult constitutional question.
One of these two sources of power must give way when they
collide, and as I read it, footnote 9 of McPherson signals that the
usual rules of deference to legislation adopted by ballot initiative
may have to yield in the face of competing constitutional
considerations. In my view, this is such a case.
2. McPherson Provides the Backdrop
Before delving further into the conflict of concurrent
powers issue before us, some background discussion of
McPherson is useful. At issue there was an initiative statute,
20
Proposition 80, that expanded the regulatory jurisdiction of the
Public Utilities Commission (PUC). Article XII, section 5, gives
the Legislature “plenary power” to confer “additional regulatory
authority and jurisdiction” upon the PUC, and the question was
whether that clause prevents the voters from expanding the
PUC’s regulatory jurisdiction by statutory ballot initiative.
(McPherson, supra, 38 Cal.4th at p. 1023.) The Court of Appeal
said yes, holding that legislation by ballot initiative was
preempted on all subject matter covered by article XII, section 5.
(McPherson, at p. 1023.)
The Supreme Court reversed. After canvassing its
precedents, the court concluded, first, “long-standing California
decisions establish[] that references in the California
Constitution to the authority of the Legislature to enact specified
legislation generally are interpreted to include the people’s
reserved right to legislate through the initiative power”
(McPherson, supra, 38 Cal.4th at p. 1043); and second, “in light of
the background and purpose of the relevant language of article
XII, section 5, . . . [the clause] does not preclude the people,
through their exercise of the initiative process, from conferring
additional powers or authority upon the PUC” (id. at pp. 1043–
1044).
The second step of the analysis in McPherson, laying out
the historical backdrop to article XII, section 5, was key. At the
time it was added to the Constitution in 1911, there was great
concern that railroad companies exercised de facto control over
many organs of state government, including the Railroad
21
Commission, the precursor to the PUC. (McPherson, supra,
38 Cal.4th at pp. 1038–1039.) By controlling the membership of
the Railroad Commission, the railroads managed to evade
regulation of their rates. (Ibid.) The motivating purpose of the
ballot initiative that became article XII, section 5, was to take
membership control of the Railroad Commission away from the
railroads and ensure that, going forward, the Railroad
Commission had adequate regulatory authority to control
railroad rates. (McPherson, at p. 1040.) The clause in article XII,
section 5 conferring “plenary power” on the Legislature to grant
“additional authority and jurisdiction” addressed the potential
that, to ensure the Railroad Commission’s continued regulatory
effectiveness, expanded regulatory authority might be needed in
the future.
When McPherson was decided in 2006, the regulatory
target was different, but the overall purpose of article XII,
section 5, was the same. Independent electric service providers
(ESP’s) were then an important new source of electric power to
the public grid, and utilities’ cost of power purchases from them
was increasingly affecting rates to consumers. (McPherson,
supra, 38 Cal.4th at pp. 1025–1027.) But ESP’s emerged in the
1990’s as creatures of the energy deregulation movement and
were unregulated, so the PUC had no rate-setting or enforcement
control over them. (Ibid.) To fill the gap, Proposition 80
extended the agency’s rate-setting and enforcement authority to
ESP’s. (McPherson, at pp. 1025–1027.)
22
The Supreme Court concluded that this new grant of
regulatory authority was consistent with the “origin and purpose”
of article XII, section 5 (McPherson, supra, 38 Cal.4th at p. 1025):
To ensure the continuing effectiveness of the Railroad
Commission, and hence of its regulatory successor, the PUC.
McPherson would have been a very different case—the type of
case we have here—had Proposition 80, for example, removed the
PUC’s statutory jurisdiction to regulate investor-owned utilities
rather than added to it. That is why respondents invoke
footnote 9 of the McPherson opinion. They argue that, while
ballot statutes may be used to build upon and refine our
constitutionally sanctioned “complete system of workers’
compensation,” the power to legislate by initiative may not be
used to undermine that system.
The interveners deride respondents’ reading of McPherson
as an attempt to create a “one-way ratchet” permitting additive
revisions to our statutory workers’ compensation system, but not
subtractions from it. What the interveners overlook, in my view,
is that, structurally, our state Constitution supports respondents’
reading much better than it does theirs. They are asking that we
allow the voter electors to “undo” what the Legislature has done
pursuant to its article XIV, section 4 powers, and at the same
time bar the Legislature from restoring what the electors have
taken away, even if a majority of the Legislature reads the
Constitution to require it.
We are not dealing simply with who gets the legislative last
word. Because the issue of whether an app-based driver is an
23
employee or an independent contractor determines threshold
eligibility for workers’ compensation, it is squarely within the
heartland of lawmaking power conferred solely upon the
Legislature in article XIV, section 4. By seeking to reserve all
statutory lawmaking power for themselves on this issue, the
Proposition 22 voter electors go well beyond a measure in which
voter electors have told the Legislature not to tinker with their
statute. This statutory initiative attempts to seize and
permanently redistribute constitutional power in a manner that
subverts article XIV, section 4, itself.
Let me be concrete about the problem I see here.
If, mindful of the robust support for the Proposition 22 in the
November 2020 election, a majority of elected legislators
understand it to be their solemn constitutional obligation under
article XIV, section 4, to override the definition of “independent
contractor” adopted by voter electors—none of whom took any
oath to uphold the Constitution when they entered the voting
booth—I believe these legislators should be free to do so,
unimpeded by Proposition 22. Indeed, I believe that article XIV,
section 4, entitles them to have the last word on that issue, since
the definition of “independent contractor” in Proposition 22
“would, in effect, be an amendment of the Constitution, if
accepted as authoritative.” (PG&E, supra, 180 Cal. at p. 500.)
For that reason alone, we must resolve the conflict of
concurrent powers issue presented in this case in favor of the
Legislature. And in doing so, we need not handle this conflict as
a zero-sum showdown in which one of the two must nullify the
24
other. All we need do to resolve this case is recognize that we are
in a “zone of twilight” (Youngstown Sheet & Tube, supra, 343 U.S.
at p. 637 (conc. opn. of Jackson, J.) where both powers are
operative, while resolving the conflict on this particular record
based on a tie-breaking principle drawn from article XIV,
section 4. In practical terms, what that means is simply this:
When the electors choose to legislate on the topic of workers’
compensation by ballot, they must do so in a manner that is
consistent with any prior exercise of article XIV, section 4, power
by the Legislature.
Proposition 22 fails that test. The Legislature used its
article XIV, section 4 power in passing Assembly Bill 5, which
was enacted in 2019 to clarify that app-based drivers and
couriers are included within the existing workers’ compensation
and occupational health and safety systems. Because the
Legislature had acted previously on this topic pursuant to article
XIV, section 4, when Proposition 22 came to the ballot, and acted
decisively, I believe the voter electors were required to respect
what the Legislature had done and lacked power to countermand
it. To borrow Justice Jackson’s famous phrasing, Proposition 22
having been adopted in the face of the “expressed will” of the
Legislature, the voters’ power to legislate by initiative on the
same topic was at its “lowest ebb” in those circumstances
(Youngstown Sheet & Tube, supra, 343 U.S. at p. 637), and must
be deemed subordinate.
Courts have recognized a number of implied limitations on
the initiative powers. Although article XVIII, section 3, of the
25
Constitution expressly declares that it can be amended by
initiative, the initiative cannot be used to revise the Constitution.
For example, the power of statutory initiative cannot be used to
order the Legislature to pass a resolution because article II,
section 8(a) speaks only of the “adoption or rejection of
‘statutes.’ ” (American Federation of Labor v. Eu (1984) 36 Cal.3d
687, 708.) Nor can the power of statutory initiative be used to
regulate the Legislature’s internal operations, because that
would conflict with the express grant of power in article IV,
section 7(a) authorizing the Legislature to run its own affairs.
(People’s Advocate, Inc. v. Superior Court (1986) 181 Cal.App.3d
316, 327.) To this list, I believe we must add that the power of
statutory initiative cannot be used to subvert an express
constitutional power delegated to the Legislature, and to the
Legislature alone. (Ibid. [“Only by means of an initiative
constitutional amendment may the people modify or impinge
upon the freedom of the Legislature to exercise its
constitutionally granted powers.”].)
D. Applying “The Relevant Constitutional Provision”
(Article XIV, Section 4) to the Terms of the Statute
Involved (Proposition 22)
Although Justice Jackson’s Youngstown Sheet & Tube
concurrent powers framework provides important analytical
guidance for resolving the conflict of legislative powers problem
before us—and answers the question presented here simply and
easily when applied in light of cases recognizing certain implied
limits on the initiative power—the specific mode of analysis must
26
come from McPherson, since in that case our Supreme Court laid
the groundwork for us in a case that is unquestionably the closest
analog to our own. Footnote 9 of the McPherson opinion states
that, should a conflict of the kind it contemplates arise in some
future case, the analysis will be governed by the “application of
the relevant constitutional provision or provisions to the terms of
the specific legislation at issue.” (McPherson, supra, 38 Cal.4th
at p. 1044, fn. 9.)
As I noted above, the independent contractor definition in
Business & Professions Code section 7451 is the “specific
legislation” at issue here. This provision overturns the
Legislature’s judgment in Assembly Bill 5 that app-based drivers
must be treated as employees until putative employers prove
otherwise in case-by-case adjudication within the workers’
compensation system. Because class-wide exclusion of app-based
drivers from the workers’ compensation system is the main
objective of Proposition 22—in direct conflict with Assembly
Bill 5—the analysis under footnote 9 of the McPherson opinion
turns on the language of article XIV, section 4.
Settled principles of interpretation govern the inquiry.
Because it is elementary that we avoid interpreting our
Constitution in a manner that renders any of its provisions
nugatory, inoperative or meaningless (Lungren v. Deukmejian
(1988) 45 Cal.3d 727, 735), we must strive to give article XIV,
section 4, meaning. To discern the intent of the people acting in
their sovereign capacity in 1918—and not project our modern
understanding in retrospect—we must apply “ ‘ “the same
27
principles that govern statutory construction.” [Citation.] Where
a law is adopted by the voters, “their intent governs.” [Citation.]
In determining that intent, “we turn first to the language of the
statute, giving the words their ordinary meaning.” ’ ” (People v.
Raybon (2021) 11 Cal.5th 1056, 1065.)
If it is necessary to go beyond plain meaning and consider
context, historical context is relevant, as our Supreme Court
recognized in addressing the parameters of a similar
constitutional provision, article XII, section 5, in McPherson.
(See McPherson, supra, 38 Cal.4th at pp. 1039–1040.) And as
with statutory construction, the language in question “ ‘must also
be construed in the context of the statute as a whole and the
overall statutory scheme. [Citation.] We apply a presumption, as
we similarly do with regard to the Legislature, that the voters, in
adopting an initiative, did so being “aware of existing laws at the
time the initiative was enacted.” ’ ” (People v. Raybon, supra,
11 Cal.5th at p. 1065.)
1. Text: Detailed and expansive grant of power “unlimited
by any provision of this Constitution” to “create” and
“enforce” a “complete system of workers’ compensation”
Applying these principles to article XIV, section 4, two
things are immediately apparent. First, what is most striking
textually about article XIV, section 4, is its detail and specificity.
There is a reason for that. When “California joined a rapidly
growing number of states in adopting . . . workmen’s
compensation act[s]” in the early twentieth century (Mathews,
28
supra, 6 Cal.3d at p. 729), 15 our state was one of only a small
group that specified “definite forms of compensation laws” in its
Constitution. (Schneider, The Law of Workmen’s Compensation
(1922) Ch. 2, § 4, p. 10, fn. 5.) 16 The Proposition 22 proponents
largely ignore the specificity of the text, dealing with it
dismissively by suggesting that article XIV, section 4, is archaic
(which is incorrect, as I have noted above), and is in any event
redundant to the police power (which is equally incorrect, as I
have also noted above).
The breadth of the constitutional language is also striking.
Article XIV, section 4, grants “plenary” legislative power
“unlimited by any provision of this Constitution.” (Art. XIV, § 4,
italics added.) The Proposition 22 proponents contend a literal
reading of this expansive language would lead to absurd results,
for it would free the Legislature from constitutional constraints
such as the gubernatorial veto. But that is a strawman
15 See Fishback & Kantor, The Adoption of Workers’
Compensation in the United States, 1900–1930 (1998) 41 J. Law
& Econ. 305, 319, table 2 (listing 48 states that adopted workers’
compensation statutes between 1910 and 1918); id. at p. 319
(“ ‘No other kind of labor legislation gained such general
acceptance in so brief a period in this country.’ ”).
16See Dinan, Foreword: Court-Constraining Amendments
and the State Constitutional Tradition (2007) 38 Rutgers L.J.
983, 995–996 (noting that constitutional provisions “guaranteeing
the constitutionality of workers’ compensation programs” were
adopted in New York, Ohio, Arizona, California, Vermont,
Wyoming, Pennsylvania, and Texas); id. at p. 995 (describing
these provisions as “court-preempting constitutional
amendments”).
29
argument. The breadth of the grant is easily explained by the
variety of constitutional objections that had been raised prior to
1918. Due process objections were a concern, but not the only
ones.
Nor is there any need to read this language as giving the
Legislature wholly unchecked power, which was the contention
Justice Henshaw made in Western Indemnity I, as echoed by the
Proposition 22 proponents here with their “absurd results”
argument. Respondents readily concede the Legislature must
pass “appropriate legislation” under article XIV, section 4, before
its views are binding on anyone. Naturally, that requires
adherence to all requisite procedures under article II, section 8,
subject to gubernatorial veto. Without following those
procedures, no bill the Legislature passes is binding on anyone.
It is not law at all, and is certainly not “appropriate legislation.”
Similarly, a statute that exceeds the Legislature’s authority
under article XIV, section 4, would not be “appropriate
legislation.” 17
Second, functionally, the constitutional text charges the
Legislature with the responsibility not only to “create” a
“complete system of workers’ compensation”—in effect, codifying
in the Constitution itself the statutory system then in existence—
The Proposition 22 proponents make no claim that
17
Assembly Bill 5 exceeded the Legislature’s authority under
article XIV, section 4. Nor could they, since Assembly Bill 5
simply codified the Supreme Court’s holding in Dynamex
Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903
(Dynamex).
30
but also to “enforce” that system “by appropriate legislation” in
the years ahead, while making clear that the pre-1918 “social
public policy” reflected in the Legislature’s “complete system of
workers’ compensation” has constitutionally binding effect on
“all departments of State government.” (Art. XIV, § 4, italics
added.) There is nothing time-limited about any of this. Article
XIV, section 4, gave the Legislature a constitutionally designated
role in 1918, and that role continues today. Nowhere is there any
hint or suggestion that voter electors may commandeer it by
ballot statute.
Here again, the Proposition 22 proponents respond with
overstatement. In their view, any suggestion the Legislature has
a singular role to play under article XIV, section 4, must mean an
exclusive role—preemptive of action by any other governmental
actors. As framed in McPherson, that was indeed the issue
addressed, there in the context of article XII, section 5. But not
here. Respondents make no attempt to read article XIV,
section 4, so broadly that it would nullify the power to adopt
initiative statutes or place the Legislature’s judgments beyond
judicial review. Nor do I. What we are called upon to decide is
whether, absent a constitutional amendment, the text of article
XIV, section 4, requires “all departments of State government” to
give deference to the Legislature’s specifically delegated power to
“create” and “enforce” a “complete system of workers’
compensation.” This is why I believe it is crucial to appreciate
that we are dealing with two concurrent powers here, and that
the clash between them on this record must be resolved by
31
examining whether we can discern in the text of article XIV,
section 4, any preference for either of these two forms of statutory
lawmaking when they are in conflict.
I think the answer is yes, we can discern such a preference,
and it is for lawmaking by the Legislature. The grant of
lawmaking power in article XIV, section 4, is not self-executing.
While voter electors passing an initiative statute have no duty to
do anything—their lawmaking power is purely discretionary—
article XIV, section 4, charges the Legislature with an ongoing
responsibility to carry out and abide by the terms of a
constitutional mandate. “[A]rticle XIV, section 4 . . . defin[es] the
necessary provisions for a complete workers’ compensation
system, and le[ft] it up to the Legislature to enact laws to give
effect to each provision.” (Bautista v. State of California (2011)
201 Cal.App.4th 716, 729; see ibid. [“only the Legislature has
constitutional authority to create and enact the workers’
compensation system”].) This special role is not discretionary.
Under article XIV, section 4, “[t]he Legislature must act to fulfill
its constitutional mandate to create the workers’ compensation
system, and the judicially enforceable rights are the laws it
enacts.” (Bautista, at p. 729, italics added.) 18 So long as the
18 My colleagues observe that there is “no logical conflict
between article XIV, section 4 needing implementing legislation
and the voters retaining their initiative power in the same field”
and that “both can coexist.” (Maj. opn., ante, at p. 14, fn. 7.)
I have not suggested to the contrary. They seem to miss the
point of my focus on the need for implementing legislation: The
Legislature has a constitutional duty to act under article XIV,
32
Legislature acts within the boundaries of its authority under
article XIV, section 4, its specially designated constitutional role
demands deference.
Just as with Youngstown Sheet & Tube, there is a federal
model to draw upon here. This model reflects a great deal of
accumulated judicial wisdom applying what are perhaps the most
well-known implementing clauses in American constitutional
law—Congress’s “power to enforce, by appropriate legislation, the
provisions of ” the Fourteenth and Fifteenth Amendments. (U.S.
Const., XIV Amend., § 5; XV Amend., § 2.) The high court has
consistently held that “Congress’ judgment regarding exercise of
its power to enforce the Fourteenth and Fifteenth Amendments
warrants substantial deference.” (Shelby County v. Holder (2013)
570 U.S. 529, 566 (dis. opn. of Ginsburg, J.).) It is true, of course,
that Congress’ powers are limited by enumerated grants, while
the police power is a general power to govern by legislative
prescription and needs no affirmative grant. But that makes no
difference. The lesson to be drawn from these venerable grants of
Congressional authority is that a constitutionally conferred
prospective enforcement power carries with it an ongoing
responsibility to apply and determine the meaning of
constitutional language when faced with changing conditions.
Legislative judgment in discharging that constitutional
responsibility merits substantial deference.
section 4, while voters going to the polls do not. A conflict arises
only if ballot electors seek to obstruct the Legislature from
discharging its duty.
33
To protect the enforcement prerogatives given to the
Legislature in article XIV, section 4, substantial deference is due
here as well—and not just from courts, but also from ballot
statute electors. Unless we treat ballot statute electors as
somehow outside our basic plan of government, they are bound to
give the Legislature deference, just as courts are. Giving the
expansive constitutional text its plain meaning, I believe we
should read article XIV, section 4, as a command that when the
Legislature enacts “appropriate legislation” designed to
implement the constitutionally mandated “complete system of
workers’ compensation,” its judgment trumps that of unelected
voter lawmakers in the face of a conflict. So understood, article
XIV, section 4, does not oust voter electors of power to legislate on
the topic of workers’ compensation; it simply requires them to
respect prior determinations of the Legislature as to what the
Constitution requires.
2. Historical context: Augmentation of the original 1911
amendment, former article XX, section 21, and
significance of Western Indemnity I to the issue of
pro tanto repeal
The historical context surrounding the adoption of article
XIV, section 4, supports this reading of the text. The original
1911 amendment was relatively brief. It stated, simply: “The
legislature may by appropriate legislation create and enforce a
liability on the part of all employers to compensate their
employees for any injury incurred by the said employees in the
course of their employment irrespective of the fault of either
34
party. The legislature may provide for the settlement of any
disputes arising under the legislation contemplated by this
section, by arbitration, or by an industrial or accident board, by
the courts, or by either any or all of these agencies, anything in
this constitution to the contrary notwithstanding.” (Former
art. XX, sec. 21, added by Prop. 10, Special Elec. (Oct. 10, 1911);
Ballot Pamp. text of Prop. 10 at