A new state law is about to rewrite the rules of freelance and gig work in California, causing confusion among the many workers who earn their living as independent contractors in the Los Angeles creative economy. Workers as varied as musicians and photojournalists could be affected by AB5, which takes effect Jan.
The law codifies a California Supreme Court decision that introduced strict new rules governing the legal definition of independent contracting in the state. In short, more companies will be pushed to classify their workers as employees. Much of the discussion leading up to the passage of AB5 focused on gig companies like Uber and Lyft, which have fought employee status for their drivers. These companies can save an estimated 30 percent on labor costs by classifying their workers as independent contractors.
With some California gig economy workers now earning less than minimum wageproponents of AB5 hope the law ends what they see as systematic worker misclassification. But platforms like Uber and Lyft represent just a fraction of California's independent contractor workforce.
In a city like Los Angeles, contract workers are also hustling to make it in the music industry, get published as freelance writers and pick up newspaper photo assignments. On the eve of AB5 going into effect, here's a breakdown of how some jobs could change in Kristen Lopez covers entertainment for outlets like Forbes. After writing from Sacramento for years, she took the plunge and moved to L.
But now she's worried her freelance work could dry up as a result of AB5. The law allows writers to keep freelancing without changes — up to a point.
If writers submit more than 35 articles a year to any given outlet, they would need to be hired as an employee. Lopez said she contributes much more than 35 articles a year to the sites that make up the bulk of her income.
One outlet has already told her she'll have to stay below the cap inunless she can set up a corporate structure that satisfies the law's "business-to-business" exemption. Lopez fears that other outlets may decide to sever ties with her and other California-based freelancers entirely, to avoid the risk of non-compliance with AB5.
Hundreds of freelancers in California have already been dropped by clients like Vox Media. Assemblywoman Lorena Gonzalez, the author of AB5, has said the law "seeks to eliminate exploitive permalance positions not legitimate freelance opportunities.
In order to comply with AB5, some outlets have turned regular freelance contributors into part-time employees. But Lopez said even if she were offered a full-time job, her disability would preclude her from taking it. Lopez has brittle bone disease and uses a wheelchair. She receives cash assistance through Social Security and gets specialized medical treatment through her Medi-Cal coverage — resources that she said would be jeopardized if she took a traditional job.
And that's what this job allows me to do.Superior Court.
AB5’s Impact On Musicians – Problems and Solutions
AB 5 entitles workers classified as employees to greater labor protections, such as minimum wage laws, sick leave, and unemployment and workers' compensation benefits, which do not apply to independent contractors. AB 5 allows businesses to apply for exemption, which Uber and Lyft attempted, but were both denied.
Several businesses were granted exemptions because they were able to demonstrate the following:. Uber and Lyft both said they plan to continue "business as usual" and are refusing to reclassify their drivers as employees, which potentially exposes the gig-work companies to litigation from state agencies. On April 30,the Supreme Court of California ruled in Dynamex  to impose stricter requirements for employee classification.
It created a 3-part test to determine whether an employee could be classified as a contractor rather than an employee, commonly known as the "ABC" test, replacing a previous point standard set in Borello  in the Borello test.
This test is excluded in certain specified cases, where Borello will continue to apply. This is declared without qualification for a specified list of occupations,  and, for other stated professionalB2B and construction services, respectively, separate lists of conditions must also be fully applicable in order to establish that a worker is an independent contractor.
The law also gives cities in the state the right to sue companies for violating the law, where previously they could not. The California Attorney General's office and local prosecutors can also sue companies. After discussions and amendments to the law, which primarily included exceptions for certain professions, the bill first passed the Assembly in May Other amendments and exceptions were made, primarily to exclude particular professions.
The bill drew national attention, including the support of multiple presidential candidates. We continue to believe that drivers are properly classified as independent. In response to the implementation of the law, the United States Court of Appeals for the Ninth Circuit reinstated its decision in Vazquez v. Jan-Pro which impacts California franchise law and California independent contractor law,  by making it unclear that if a franchisor licenses its trademark to a franchisee whether the franchisor incurs the liabilities of an employer.
Newspaper delivery workers will be given an extra year before compliance. The Association argues that many of the represented drivers had opted to be independent contractors after having been employeed drivers, as this allows them to set their own schedules and otherwise profit from owning their own vehicle. Enforcement of AB5 would force them to be treated as employees and lose these benefits, the Association argued.
On December 17,the American Society of Journalists and Authors and the National Press Photographers Association filed suit in United States District Court for the Central District of California, Western Division claiming the law unconstitutionally singled out freelance journalists by limiting the amount of work they can produce for any single publisher, unlike any other job category listed as "professional services".
Uber and Postmates filed a similar suit at the end of Decemberchallenging that the law denies equal protection due to the what types of jobs were exempted or not. Organizers expected AB5 to lead to the growth of labor unions. The Recording Academy expressed concerns that AB 5 would negatively impact gigging musicians, and stated that it is lobbying California lawmakers to inform them about "the impact of such legislation".
Director of San Jose Jazz Brendan Rawson argues that because AB 5 requires any music venue to designate members of an act performing there even once as official employees of the venue itself, events such as music festivals will be severely and unnecessarily burdened.
California Agrees to Amend AB5 Restrictions for Gigging Musicians
The only way around this, Rawson says, is for musicians to incorporate themselves. Forbes criticized the bill's limits on freelance journalism and is advocating for California to change it.
No one has ever suggested that, even freelancers. We will continue to work on this next year. In December Vox Media ended contracts with about freelance sports writers and editors who wrote for the blog network SB Nationand announced it would replace them with 20 new part-time and full-time employees. Freelance journalists who live in California fear that it will be harder to get work, because companies will not want to deal with the additional paperwork and legal liabilities of AB5 and will instead hire someone from another state.
In response to the new law, Uber has made several changes to its app for drivers in California, such as allowing drivers to see destinations in advance, and removing penalties for rejecting rides. InArizona passed HBwhich would classify many gig economy workers, including drivers in ridesharing services, as independent contractors. InFlorida, Kentucky, Indiana, Iowa, and Tennessee passed laws defining specific on-demand economy workers as a "marketplace contractor" and classify them as independent contractors.
InArkansas passed HB which codified a different part test, used by the IRS, to classify workers as independent contractors. From Wikipedia, the free encyclopedia.Photo: Paul Kitagaki Jr. But this economic blaze will ignite abruptly on January 1st and will affect the California music industry so drastically that it could completely burn it down.
As the fifth largest economy in the world and the entertainment hub of the world, this is a big fucking deal. Here's How It Went.
AB5: The day the independent music dies in California
Rather than making a law targeting specific companies, they basically outlawed all independent contractors with few exceptions.
It was signed into law on September 18, by Governor Newsom. Because it was run through committee so fast that no one really had time to process what was happening. Attorney Ned Menoyo led the discussion and broke down the law and how it will affect us. As he went on, the room got more and more unsettled to the point where people were shouting out questions left and right completely dumbfounded that something so detrimental to our livelihoods actually got signed into law without anyone knowing about it.
How this law affects musicians is not helping workers. Well, you're now technically an employee of the Bootleg, they must deduct taxes, put you and the hundreds of artists who play their venue each year on payroll.Calif.’s independent contractors warn AB 5 is killing their job prospects
Think again. Well, now you have take out taxes. Multiply that by every musician at every gig. It could run you a few hundred dollars a month! Not to mention that filing taxes for a corporate entity is extremely expensive. This law was not thought out. It disproportionately affects independent musicians. Clearly no one in the California state government has ever worked a day in the music industry. Record labels will start to take their business to New York, Atlanta, Nashville or elsewhere.
Touring bands will not come play the state anymore because the venues may not allow solo artists to accept payment under their name - forcing them to create a corporate entity to get around the employee requirement.California legislators on Friday April 17 announced changes to the language of Assembly Bill 5 AB5intending to ensure fair treatment for gig economy workers in the music industry without inhibiting their ability to create and collaborate.
But the law was met with fierce backlash from the independent music community, as it would essentially require session musicians, producers, songwriters and others who often collaborate on a gig-by-gig basis to either be legally designated as employees or not work together at all. Calderonmost music professionals will once again be able to follow the less-strict Borello test to determine employment classification for both live performances and studio recordings, instead of the three-part test established by AB5.
Musicians will continue to be protected under AB5, if their work inherently draws a significant level of control and direction from their employer. The language also provides for unions to continue to organize the work of music professionals.
When it comes to protecting work and workers in California, we want to make sure we get it right. Industry leaders from those organizations are applauding the announcement. Finding a model that fits the unique needs of musicians has been no small task, and we are grateful to everyone involved for reaching a solution that will serve to benefit musicians and all workers throughout California.
This agreement once again reflects that we are strongest when we stand together. These are challenging times for creators but this is good news for those in California. Credit: Source link. Your email address will not be published. Home Entertainment Music. Share on Facebook Share on Twitter.
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Follow Us. Browse by Category. Subscribe to get more.California has always been a haven for artists and has inspired songs that are heard around the world. A recent change in the law, about to get the stamp of approval by the California Legislature, will unintentionally drive independent artists out of California. While changes in technology have made it possible for artists to remain independent and create music on their own terms, this law will force them to make that music outside of California.
We understand, appreciate and support the legislators wanting to protect hundreds of thousands of drivers in our state who are working without benefits, while the corporations involved reap the profits of their labor.
Unfortunately, the law is so broad it will have outsized consequences for independent musicians: treating them like Uber and Lyft executives, rather than protecting them like the drivers. This makes sense for large corporations like Uber and Lyft; it does not make sense for the independent artist who is trying to make music. Artists work with many people to help them realize their vision: producers, engineers, musicians, publicists, managers, music video creators, dancers, background vocalists, etc.
Under this new law, an artist in California could become the employer of all of these people. Think of a year-old kid in her bedroom making music. Is she capable of becoming an employer and providing punch cards, time sheets, guaranteed meal breaks, health care, retirement benefits, overtime pay calculation, mandatory tax withholdings? Think of N. Inthe opportunities to make music independently are endless, and this law threatens to quash that innovation.
This is not an issue of big vs. This is small struggling to become big. There are tens of thousands of kids with dreams in the State of California. Dreams to be a recording artist, a singer, a producer, a rapper, a small label executive, a major label executive, perhaps one day. The unintended consequence of this law is that they will have to move out of California to pursue this dream. Unless, just maybe there is something we can do about it. AB5 allows industry exemptions.
We all agreed on an exemption — and when was the last time recording artists, indie and major labels agreed on something? We have a good deal of union support, but not all of them. If you care about allowing independent artists, songwriters, and labels in California to stay, we need your help. Call your local state legislature, your union, the AFM. Tell them how important it is to you that we keep the music in California.
Ask them to support an exemption to AB5 for independent recording in California. California has always protected independence for artists. All rights reserved. AB5: The day the independent music dies in California By: courtesy. On: September 7, In: Guest Editorial. Tagged: businessGovernmentguest editorialpolitics.
The young girl in her basement recording on garage band.But by the time it became law in September, the measure had swept up many other participants in the growing gig economy, with far-reaching unintended consequences. The same would apply to a club owner for every musician hired, even for a single set. Anyone you hire may need to be an employee of your company if you even have a legal entity registered. It will take effect January 1, Compliance and enforcement promise onerous costs and reporting headaches, but the greatest anxiety surrounds the anticipated broader chilling effect on the paid music scene throughout the state.
It is feared that, faced with the prospect of lost revenue and monumental administrative requirements, venues will curtail live music activities, and producers will move projects to more work-friendly environments. Since AB5 became law, a grassroots movement comprising local musicians and related industries and organizations has begun a campaign to reverse it, starting with a concerted appeal to state Senators and members of the California Assembly.
Worship musicians have typically been independent contractors if the church is small. Now they must be employees, with sick days, minimum wage for rehearsals, and all the overhead costs to be borne by the church.
I am aware of some churches that have had to fire all their musicians in order to be in compliance. No small church can possibly afford the terrible fines should they be considered out of compliance — just a few musicians out of compliance a few times could cost the church tens of thousands of dollars in fines. This site uses Akismet to reduce spam. Learn how your comment data is processed. California Assembly Bill 5 classifies independent musicians as employees rather than contractors.
Fox December 30, Sneaky Pete March 9, The bill was rushed through committee… the fixes will take years…. Leave a Reply Cancel reply Your email address will not be published.Members of the live music industry are celebrating an agreement that was reached today on pending amendments to the recently introduced gig economy law in California, Assembly Bill 5 AB5.
AB5 was created as a response to rideshare services like Uber and Lyft, attempting to make it harder for gig-based companies to position drivers as independent contractors, who lack perks like benefits, instead of proper employees. But due to the nature of their work, myriad members of the music community were lumped into the law, thanks to broad legal phrasing.
The original version of AB5 could be considered a win for ride-share drivers but not independent and smaller-scale artists, who could have been forced to offer a full employee salary to any crew member, producer, or songwriter that worked for them on a contractual basis.
But the reworked language of the law on Friday allows most music professionals to once again access the Borello test, which decides if a person is an employer instead of an independent contractor, to determine employment classification for both live performances and studio recordings.
Artists small and large were preparing for a stage slot that has been said to launch careers to another level, and their crews were depending on the pay day. In an uncertain time rife with anxiety, the AB5 win may just make things a little brighter for artists sitting at home, worried about the post-pandemic future.
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