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Home / Business / AB5, based on the California decision of the Dynamex Court, brings the law a step closer

AB5, based on the California decision of the Dynamex Court, brings the law a step closer

A measure to curb the widespread use of independent contractors in the California economy moved closer to final adoption on Friday when Uber, Lyft and other gig-economy companies launched a fierce lobbying campaign to circumvent their reach ,

Groundbreaking legislation that could set a precedent for a national struggle to improve pay and benefits for low-paid and middle-class workers would change the employment status of more than one million Californians.

Janitors clean up downtown office buildings, truck loaders goods in the ports of Los Angeles and Long Beach, construction workers who build new homes, manicurists, medical technicians, strippers in nightclubs, and even software programmers are among the professions that provide protection long-documented abuses in the workplace. Emagazine.credit-suisse.com/app/art…1

007 & lang = DE The law requires a rigorous test before companies can classify workers as contractors. Both houses are expected to pass the legislature before the legislature adjourns 13 September.

In this case Governor Gavin Newsom is expected to sign the bill. "The governor supports the fight against misclassification of workers, which has been a source of income inequality for decades," Newsom spokesman said.

Hundreds of companies had to deal with litigation and state punishments
The treatment of workers as independent contractors, a decade-long national trend that has deprived wage earners, weakened trade unions and contributed to what professionals call a jarring workplace between owners and non-owners.

An estimated 400,000 Californians work in both countries. Time or full-time employment for fast-growing, platform-based technology companies providing a range of services such as travel, grocery deliveries, household repairs and dog walks.

App-based companies argue that they offer a different employment
Model – innovative and flexible – and should therefore be exempted from AB5
Contractors can have their employees set their own schedules and work for multiple companies. AB 5 could cost companies millions of dollars
Inhibition of future profitability.

Such spin-off of gig companies is unlikely this year, but in an aggressive power game Uber, Lyft and DoorDash on Thursday threatened to spend $ 90 million on a 2020 election measure unless the legislation passes a new bill that allows them To avoid riders being classified as workers.

The California Labor Federation, which represents 1,200 unions with 2.1 million members, vowed to stop efforts that, if they occur, could be one of the most expensive election campaigns in the history of the state. [19659002] Newsom has hinted that it could support Gig companies' proposal to set up a special employment category for app-based drivers, and its employees have been negotiating the details with Uber and Lyft for months. "Legislation [AB 5] has brought many arguments, so there was a framework for compromise," Newsom told reporters earlier this month.

In a letter this week, 75 law professors, economists and other scientists urged Newsom and legislators not to liberate
Gig workers who write that "California is ready to lead the country – indeed, to lead the world – with the most stringent law to protect workers from misclassifications."

Contractors, including many billion dollar technology companies, do not. This is subject to laws that include a minimum wage, overtime, sick leave, family leave, unemployment and disability insurance, compensation for workers, and protection against discrimination or theft sexual harassment guarantee misclassification. Companies also do not pay Social Security or Medicare taxes to contractors.

  Los Angeles Striking Truckers

Truckers serving the ports of Los Angeles and Long Beach have filed suit, and the California Labor Commissioner has imposed fines on truck companies for misclassifying drivers as independent contractors.

[Mark Boster / Los Angeles Times]

AB5 is based on a landmark 2018 California Supreme Court decision whereby Dynamex Operations West, a national parcel delivery company, reclassified and coerced its employees as independent contractors to use their own vehicles and to pay for petrol and other expenses – similar to Uber, Lyft, DoorDash, Postmates and Amazon Flex.

The court has put in place a rigorous new test: workers must be treated as employees, not as independent contractors, if their work is central to a company's core business or if the bosses determine the way in which the work is done is performed. For example, a solo plumber with his own company hired by a bakery to repair a leak may be an independent contractor. But a plumber who works regularly for a plumbing company and is sent to work must be an employee.

A stricter standard, the court wrote, was designed to discourage companies from eluding "basic responsibilities" and embarking on a "race to the bottom". … lead [ing] to inferior wages and unhealthy working conditions. "

Codifying this new test makes AB 5 less vulnerable to legal challenges and allows the state, not just the courts, to enforce it. [19659002] For months, the author of the bill, Assembly leader Lorena Gonzalez (D-San Diego), has limited its scope by making certain changes
Professions, including doctors, lawyers, architects, engineers, accountants, insurance agents, real estate agents, hairdressers, freelance journalists and financial brokers.

The exceptions, she said, enabled independent contracting "in professions where people have the ability to negotiate for themselves and where they own their own business in occupations where there is no documented misclassification and wage theft.

On Friday, new concerns over the concerns of the trucking industry, which filed suit in the federal court to overturn Dynamex's decision, had used caravan protesting drivers to circle the capital. Ownership operators who work for several companies – for example, deliveries to construction sites – could be considered as independent contractors if they meet strict company ownership criteria.

However, the changes do not free the thousands of port truck drivers who work for Southern California hauliers, who have been repeatedly charged by state agencies for misclassification and wage theft.

"Trucking has some of the worst offenses," said Gonzalez. "We will not abolish the protection of workers."

Other provisions added on Friday included exceptions for dentists, podiatrists, psychologists, travel agents, payment processors, photographers, editors, and commercial fishermen.

Despite lobbying by Californian authorities News Publishers Assn., Newspaper agents, the plaintiffs in
Misclassification actions were not exempted. (The Los Angeles Times is one of the 500 members of the association.)

AB 5 has never been included in the California Chamber of Commerce's annual list of "job killer" statements, a term that often causes legislation to fail. This is because the court decision would remain in force without a bill, which affects a far greater number of companies than AB 5 and leads to more litigation.

"AB 5 is a compromise," said Chamber President and CEO Allan Zaremberg. "It is appropriate to certain occupations, but not many other situations. … Organized work wants every employee to be. That is not necessarily realistic. "

The Chamber is" hopeful for a legislative solution "for companies serving customers via an app.

So far, votes on AB 5 have been largely biased, with Democrats backing the bill overwhelmingly and most Republicans

Uber and Lyft riders raised public protests against it
reduced wages
arbitrary dismissals,
Manager salaries in the millions
and shareholder rain. However, some democratic legislators, who often follow business policy, suggest that AB 5 does not provide enough flexibility for workers.

"We need to protect the workers from exploitation," said Senator Steve Glazer (D-Orinda). "But we should also protect the right of people to be their own boss, if they want to – as long as they set their own hours, demand what they want, and control their work product."

While the Golden State wants to enforce its groundbreaking legislation, other states are considering similar reforms. Several Democratic presidential candidates have supported AB5 and similar legislation has been introduced in Congress.

Steve Smith, a spokesman for the California Labor Federation, said, "The nation is watching what California is doing."

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