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Independent contractor bill moves to Assembly floor

AB 5 introduced by Assemblywoman Lorena Gonzalez (D-San Diego), is a bill that would codify the California Supreme Court’s holding in Dynamex Operations West, Inc. v. Superior Court, a decision which makes it more difficult for businesses to classify their workers as independent contractors, was passed out of the Assembly Appropriations Committee yesterday on a 13-3 vote.

AB 5 is being closely watched throughout the Capitol because it is also the vehicle that will include negotiated exemptions for certain types of workers from the Dynamex ruling.

In her comments to the Assembly policy committee that first heard the bill, 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 amending the bill to exempt additional classes of workers from the “ABC test” established in the Dynamex case. Currently, the bill creates carve outs for insurance agents, physicians, securities brokers, and direct sellers. CNPA is seeking to add amendments that would allow newspapers to continue to contract with newspaper carriers and freelance journalists.

AB 5 will likely be heard on the Assembly floor sometime next week.

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