Many corporations that employ gig workers treat their workers like independent contractors in order to avoid paying them benefits and other employment protections. Fortunately, this practice is coming to an end since California passed a bill (AB5) that will result in the further reclassification of gig workers as employees.
This means that reclassified gig workers will receive benefits such as a guaranteed minimum wage, overtime wages, health care benefits, unemployment, workers’ compensation, and any other benefits that employees are guaranteed under California law.
It’s Been the Law Since 2018
This change in independent contractor-employee classification actually began in 2018 when the California Supreme Court ruled in a case known as Dynamex. Dynamex set forth that in order for a worker to be classified as an independent contractor, a business must show that the worker:
- Is free from the control and direction of the employer,
- Performs work that is outside the hirer’s core business, and
- Engages in an independently established trade, occupation, or business.
While this Dynamex test is the current California employment law, codifying this employee-contractor test through the legislature expands employee protections to all aspects of the state labor code.
Who Does AB5 Apply To?
AB5 applies to any gig worker or independent contractor that performs work that is the core of his or her employer’s business. For example, almost all grocery delivery contract workers are not likely to pass the Dynamex test, since delivering groceries is the main purpose of their grocery delivery employer’s business. Companies like Shipt, Postmates, Amazon Mechanical Turk, Deliv, Puls, Opoli, Uber, Lyft, Wingz, Rev, and Market Force Information are all currently employing independent contractors in violation of Dynamex and AB5.
AB5 provides an exemption for categories of workers who are typically considered to own their own businesses: doctors, real estate agents, lawyers, dentists, insurance agents, accountants, engineers, hairstylists and barbers who rent booths, architects, and other similar positions.
Call PARRIS Employment Attorneys
If you’re a gig worker that would like to start a free case consultation, call PARRIS at (661) 485-2072. Our employment attorneys have represented thousands of workers across California since 1985, and have recovered over $500 million in workplace lawsuits. You pay no fees until we win your case.