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Independent contractor bill moves forward in Assembly

Independent contractor bill moves forward in Assembly

Assemblywoman Lorena Gonzalez’s (D-San Diego) AB 5 this week passed out of its first policy committee. AB 5 would codify the California Supreme Court’s holding in Dynamex Operations West, Inc. v. Superior Court, which made it more difficult for businesses to classify their workers as independent contractors, but is also the bill being used to exempt certain types of workers from the Dynamex ruling.

In her comments to the Assembly Labor and Employment Committee, Assemblywoman Gonzalez said “I’m committed to striking a balance so we can extend critical employment protections to more workers while separating groups that genuinely function as small businesses.”

A coalition of business groups, including CNPA, have taken a support if amended position on AB 5 with the goal of having the bill amended to exempt additional classes of workers from the “ABC test” established in the Dynamex case. The letter specifically mentions that newspaper carriers and freelancers should be exempt. Currently, the bill creates carve outs for insurance agents, physicians, securities brokers, and direct sellers.

AB 5 will next be heard by the Assembly Appropriations Committee.