AB 5 defines independent contractor, protects employee rights for workers
SACRAMENTO – (Monday, December 3, 2018) – California Assemblywoman Lorena Gonzalez (D-San Diego) kicked off the new legislative session this week by introducing legislation to make it more difficult for companies to avoid the employee rights of their workers by misclassifying them as independent contractors.
Assembly Bill 5, which Gonzalez introduced Monday, would add to state law the “ABC test” adopted unanimously by the California Supreme Court this spring in its landmark decision involving Dynamex, a package and documents delivery company that converted all of its drivers to independent contractors as a move to save money at the expense of drivers’ rights on the job. In April, the Supreme Court sided with the drivers in the case and established an “ABC test” that requires workers to only be classified as independent contractors if:
A) The worker is “free from control and direction” of the employer as it relates to performance of the work;
B) The work is performed “outside the usual course” of the hiring entity’s business; and
C) The worker engages in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.
A growing number of states already use some version of this test to define independent contractors, who do not enjoy the guarantee of earning a minimum wage, paid sick leave, workers compensation benefits if they’re injured on the job, or unemployment benefits if they are laid off, as well as the protection of other workplace health and safety rights.
Assemblywoman Gonzalez said when workers fall under the uncertainty of independent contracting, it falls on the state to take care of them when they cannot find a job they get sick or they retire. “Individuals are not able to make it on three side hustles. That shouldn’t be the norm. That shouldn’t be accepted,” Gonzalez said. “In a state with one of the country’s highest poverty rates, this court decision is crucial to helping Californians maintain solid employment in an economy that’s left millions struggling.”
More Californians work as independent contractors as their main job than compared to the United States workforce overall, according to a 2017 study published by the UC Berkeley Labor Center. The California Division of Labor and Enforcement Standards says that misclassification of workers as independent contractors costs the state $7 billion annually.
For more information on this issue or to schedule an interview with Assemblywoman Gonzalez, contact Sami Gallegos: (209) 658-7617
Assemblywoman Lorena Gonzalez Fletcher represents California’s 80th Assembly District, located in southern San Diego County, including the cities of San Diego, Chula Vista, and National City. She serves as Chair of the Assembly Committee on Appropriations, Chair of the Assembly Select Committee on Women in the Workplace, and Chair of the California Latino Legislative Caucus. For more information on Assemblywoman Lorena Gonzalez Fletcher visit https://a80.asmdc.org/