AB 5 debate rages on, clean-up bill introduced

REGION — One of the state’s biggest labor battles in years has a new piece of legislation attached.

A “cleanup” bill authored by Lorena Gonzalez (D-San Diego) was introduced as the fight over Assembly Bill 5 rages on in the legislature and courts. AB 5 expanded the 2018 Dynamex decision by the California Supreme Court requiring the “ABC” test to determine if workers are employees or independent contractors.

Once a business establishes services qualify as an independent contractor, the Borello test is applied to “determine the service provider’s classification” to the contracting entity, according to informational sheet by Gonzalez.

As for the new legislation, Assembly Bill 1850, it may be heard in committee on Feb. 6, according to the California Legislature website.

“It is the intent of the Legislature to enact legislation that would further clarify the application of the California Supreme Court’s decision in Dynamex Operations W. v. Superior Court,” the bill reads.

Republican Kevin Kiley of Rocklin is calling for a repeal.

“Any lawmaker who claims AB 5 isn’t affecting thousands of people is misinformed,” he said on Twitter. “I’ve heard from thousands myself. And the number of Californians in the most impacted professions is much, much higher.”

Gonzalez has said the impetus for AB 5 was to prevent misclassification, saying ridesharing or app-based companies such as Uber, Lyft, DoorDash and Instacart, along with trucking businesses, are intentionally misclassifying drivers.

Gonzalez appeared on KUSI in San Diego on Jan. 10 to discuss the bill and one of the discussion points centered on contractors who have lost clients.

“There is no indication that thousands of people are out of work,” she said. “I understand that’s what you’ve been told by some folks, but there’s no data or indication that thousands of people have been put out of work.”

Gonzalez has said if independent contractors form a business, such as a sole proprietorship, S-Corp or LLC, they would be exempt from AB 5. However, hundreds, if not thousands, of independent contractors have challenged her claims on social media, noting many of their clients are instead cutting contracts as to not potentially violate the law.

However, Gonzalez tweeted on Dec. 19, “I almost regret asking this here, but given the broad cross section of freelance writers here, it’s a start: if the Bill (sic) was amended to make clear that the Business to Business (sic) exemption applies to freelance journalists who satisfied the requirements — would that work?

She also said later “that we tried to compromise” and “will continue to try to get this right.”

Despite the cleanup bill, a number of lawsuits are currently active against AB 5. Western States Trucking Association announced a federal judge extended a temporary restraining order “barring enforcement of AB 5,” although the case is calling for a permanent injunction.

Independent truckers also won on Jan. 10 when a state superior court judge ruled AB 5 and the Dynamex decision should not apply based on a 1994 federal law regulating “interstate commerce that endorses using independent-contractor owner-operators ‘to increase competition and reduce the cost of trucking services,’” according to the San Francisco Chronicle.

The National Press Photographers Association and American Society of Journalists & Authors have also filed suit against AB 5, citing it unconstitutionally restricts free speech. One argument for the case is the “arbitrary” 35 submission cap Gonzalez championed.