California Freelancers May Get Relief From Strict AB5 Employment Law

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California freelancers in a variety of fields may be getting some relief from the state's strict new employment law, AB 5, which went into effect at the start of 2020.

Under a bill (AB 2257) that passed the state legislature Monday night, freelance writers, photographers, translators and musicians would be among those getting exemptions from AB 5 to continue working as independent contractors, rather than employees.

The bill now goes to Governor Newsom's desk.

The move comes after strong pushback from California freelancers who said the law, spearheaded by Assemblywoman Lorena Gonzalez (D-San Diego), drove their clients to cut ties with them and instead hire out-of-state freelancers who weren't as much of a legal liability.

The new bill would create many new provisions for specific industries, including:

• It would strike the 35-submission cap for freelance writers and photographers. Under current rules, any California-based freelancer who contributes more than 35 submissions to an outlet per year must be reclassified as an employee.
• It would add translators, appraisers and registered foresters to the "professional services" exemption. This exemption currently covers graphic designers, travel agents and marketers, among others.
• It would allow workers in much of the music industry to continue working as freelancers. The list of exemptions includes recording artists, songwriters, producers, promoters and many others.

The state has used AB 5 to sue the ride-hailing companies Uber and Lyft, pressuring them to reclassify their drivers as employees eligible for protections such as a minimum wage, overtime pay, unemployment insurance and health benefits. Gonzalez said the new exemptions for certain freelancers would have no effect on other industries.

"We cannot change and will not change [the] law to accommodate work relationships that have and will always be employer-employee," she tweeted last week. "Misclassification costs us all, and we see that clearly during this pandemic."

Musicians were among those who felt the law was unworkable because it created a tangled web of employment relationships in an industry built around frequent collaboration and one-off gigs.

For instance, AB 5 requires an artist playing a show at an L.A. club to be on the venue's payroll. And if that artist wants to hire someone to play bass in their band, the artist has to treat that bassist as an employee for that night. Instead of simply cutting the bassist a check, they need to make the bassist eligible for workers' compensation, sick leave, unemployment insurance and other benefits.

Ari Herstand, an L.A. musician and author who helped organize musicians pushing for changes to AB 5, said they didn't get everything they wanted in AB 2257. For instance, AB 5's employment rules would still apply to musicians who play at big festivals and to headliners at venues with 1,500 attendees or more (such as the Wiltern).

But Herstand said if Newsom signs the bill, the vast majority of working musicians in California will be able to go back to business as usual.

"There was a lot of panic in the California music industry at the start of the year," he said. "This law could have single handedly crashed the California music economy."

The new bill was passed with an urgency clause, meaning it would go into effect as soon as Newsom signs it into law.