AB 5, Revised!

Welp, there it is:  Today, Governor Newsom signed AB 2257, which “revises and recasts” parts of AB 5.  And if your industry had a good, vocal lobbyist, you may have good news!

Of note, even if your industry/occupation is no longer governed by AB 5’s ABC test, the relationship is governed by the multifactor test previously adopted in the case of S. G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341.

Among other things, the new law –which takes effect immediately – does the following:

• Exempts certain occupations in connection with creating, marketing, promoting, or distributing sound recordings or musical compositions.

• Exempts a musician or musical group for the purpose of a single-engagement live performance event, unless certain conditions apply, and would define related terms.

• Exempts an individual performance artist presenting material that is their original work and creative in character and the result of which depends primarily on the individual’s invention, imagination, or talent, if certain conditions are satisfied.

• Deletes the existing professional services exemptions for services provided by still photographers, photojournalists, freelance writers, editors, and newspaper cartoonists. Instead, the law establishes an exemption for services provided by a still photographer, photojournalist, videographer, or photo editor, as defined, who works under a written contract that specifies certain terms, subject to prescribed restrictions.

• Establishes an exemption for services provided to a digital content aggregator, as defined, by a still photographer, photojournalist, videographer, or photo editor.

• Establishes an exemption for services provided by a fine artist, freelance writer, translator, editor, content contributor, advisor, narrator, cartographer, producer, copy editor, illustrator, or newspaper cartoonist who works under a written contract that specifies certain terms, subject to prescribed restrictions.

• Creates additional exemptions for various professions and occupations. In this regard, the bill would exempt from the “ABC test” people who provide underwriting inspections and other services for the insurance industry, a manufactured housing salesperson, subject to certain obligations, people engaged by an international exchange visitor program, as specified, consulting services, animal services, and competition judges with specialized skills, as specified.  

• Creates exceptions for licensed landscape architects, specialized performers teaching master classes, registered professional foresters, real estate appraisers and home inspectors, and feedback aggregators.

• Revises the conditions pursuant to which business service providers providing services pursuant to contract to another business are exempt. The law revises the criteria pursuant to which referral agencies and service providers providing services to clients through referral agencies are exempt and would revise applicable definitions.

• Creates an exemption for business-to-business relationships between 2 or more sole proprietors, as specified. The law provides that a hiring entity need only satisfy all of the conditions of one of the exemption provisions to qualify for the exemption from the ABC Test.

Does your relationship fit under these new rules?  Did you change how you were paying workers and now this changes what you THOUGHT were the rules?

This may shock you – this isn’t a complete explanation. But it is the Friday afternoon before a long weekend (during which I will do the same thing I do every weekend – not leave my house). But I am just summarizing a summary here. More to come when this is all parsed out!

One response to “AB 5, Revised!

  1. Nice writeup Jeanine. As if we don’t have enough on our plates, we’ve now got a more complex statute—but with much needed good news for the folks fitting under the new exemptions.
    I hope you’re doing well.
    Jeff

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