There is some potential good news for California employers, especially in the motor carrier industry. On December 31, 2019, Judge Benitez of the United States District Court, Southern District of California, ruled that the California Attorney General, Secretary of the California Labor and Workforce Development Agency, CA Department of Industrial Relations, CA Labor Commissioner, and Employment Development Department are temporarily enjoined from enforcing Assembly Bill 5 (“AB-5”) against any motor carrier operating in California, pending the Court’s resolution of Plaintiffs’ motion for a preliminary injunction, which is set for hearing on January 13, 2020.
What is AB5?
California recently adopted Assembly Bill 5 (AB 5), authored by Asm. Lorena Gonzalez (D-San Diego). AB 5 places into law an independent contractor test known as the “ABC” test. In order to be considered an independent contractor, a worker must satisfy all 3 parts of the test:
A. The person is free from the control and direction of the hiring entity, both in contract and in fact;
B. The person performs work that is outside the usual course of the hiring entity’s business; and
C. The person is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.
For more information on converting independent contractors to employees, download our FREE AB5 Compliance Handout.Continue reading