Many of you may now have heard of California legislation AB5 which was created to ensure that most workers in California are classified as employees, not independent contractors. Introduced by California Assemblymember Lorena Gonzalez, AB5 was created to incorporate the Dynamex ruling, which was a California Supreme Court decision from last year, into state law. That decision limited an employer’s ability to classify certain types of workers as independent contractors. Some members have asked if this new law will negatively impact the practice of using loan out companies as a way of ensuring fair tax treatment for our members. It is our view that AB5 will have no impact on the use of loan outs. AFM Local 47 along with DGA, WGA, IATSE and SAG-AFTRA have done exhaustive due diligence with counsel to come to this conclusion.
A message from RMALA:
We have been hearing about concern in the community about potential effects of AB 5, the recently passed California legislation that is on track for our Governor’s signature.
AB 5 was created in Sacramento to implement a California Supreme Court decision from last year, the Dynamex ruling, in which a unanimous court limited the ability to classify some workers as independent contractors. AB 5 was essentially created to carve some exemptions out from the ruling, not to add classifications. So, doctors, plumbers, private tutors and some others are being exempted from the court ruling by AB 5. Continue reading