CWR Reports to the Legislature on the Impact of Assembly Bill 5

Only a month after being enacted, CWR has already seen the tremendous impact of California Assembly Bill 5.  Signed by the Governor in September 2019, and enacted on January 1st, AB 5 codifies the “ABC test” to determine whether or not someone is an employee or an independent contractor. 

Under this test a worker is NOT considered an independent contractor unless the employer satisfies all three of the following conditions: 

  • The worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under contract for the performance of the work in fact; 
  • The worker performs work that is outside the usual course of the hiring entity’s business; and
  • The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed. 

A vast amount of low wage workers are often incorrectly paid because they have been misclassified. Employers use this misclassification to circumnavigate wage and hour laws that protect a worker’s ability to secure overtime pay, benefits, and other minimum workplace standards. Since AB 5 was passed, workers have reported that their employers are revisiting their classifications as independent contractors.

In an effort to lend support for this legislation and its continued enforcement, CWR joined with other labor organizations, coordinated by the California Labor Federation, to tell members of the legislature about the important impact this bill is having on low-wage workers. CWR knows how important it is for advocates to come together and put pressure on our elected representatives and encourage them to defend the rights of our most vulnerable communities. If you have questions regarding your workplace rights, or your classification as an employee, please call out hotline at 916-905-5857

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