Client Alert - Governor Signs Bill Codifying ABC Test For Independent Contractor Status

Jeff Dinkin, chair of Stradling's Employment Law practice group, and associate Sean Piers want to inform you on a recent bill that has been signed. On September 18, 2019, Governor Gavin Newsom signed into law AB-5, a bill that will have a major impact on any company that classifies workers or consultants as non-employee contractors. The new law codifies the standard for determining independent contractor status adopted by the California Supreme Court last year in Dynamex Operations West, Inc. v. Superior Court.  In that decision the Supreme Court adopted the “ABC” test when analyzing employment status under the California wage orders.  AB-5 expressly approves the Dynamex decision and expands the ABC test to all questions of independent contractor status under the Labor Code, the Unemployment Insurance Code, and the Industrial Welfare Commission’s wage orders. 

Read the full client alert below for more information.