Businesses across the California economy are scrambling to figure out how AB 5 affects them, whether they must adapt to it, or whether they can get out from under it.
For nearly 18 months, California’s ambitious legislation curbing the use of independent contractors was the focus of noisy street protests, furious lobbying and fearful newspaper editorials.and will take effect in January.
Contractors are divided over the law, with some seeking the protections of traditional employment and others preferring their independent status. Now, in the wake of the 2018 state Supreme Court decision and the new law, a few carriers are converting to an all-employee model or one that encourages contractors to take out their own permits and insurance.
The Harbor Trucking Assn. set up a program last year to help individual truckers convert to such a model for less than $500, also offering them discounted insurance and fuel.Golden State Logistics, a Rancho Dominguez company with 40 independent contractors, is one company pushing its workforce to be more self-sufficient.
As for AB 5, he added, “We are agnostic. Whether independent contractors or employees, what’s important is they have a choice.” For all that, she relies on gig workers, including backup musicians, recording engineers and singers she pays on a per-session basis.Parelli is worried that under AB 5 she might be considered an employer of those people. “If I pay minimum wage, health insurance, paid sick days, overtime … I’m adding 30% to my labor costs,” she said. “I have to get session players, pay someone to do my marketing, make a music video, do a tour.
The possible effect on film and television production is less clear. Entertainment industry unions, including the Screen Actors Guild‐American Federation of Television and Radio Artists and the International Alliance of Theatrical Stage Employees, Moving Picture Technicians, Artists and Allied Crafts, argue that the law won’t have a significant effect.
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