On Sept. 18, 2019, Assembly Bill Number 5 (AB5) became law in California paving the way for dramatic changes in California’s gig economy. AB5 was designed to provide labor protections for “misclassified independent contractors”, including the application of minimum wage laws, overtime, sick leave requirements, and unemployment and worker’s compensation. Once put into practice, however, AB5’s negative impacts on various industries—which rely substantially on an independent contractor workforce—quickly became illuminated. After over a year-and-a-half of lobbying efforts by the music industry and negotiations with lawmakers, it was announced on April 17, 2020 that AB5 will be amended to accommodate musicians’ unique niche in the California economy.

The Dynamex “ABC Test”

AB5, which added Section 2750.3 to the California Labor Code, codified Dynamex Operations West, Inc. v. Superior Court, a California Supreme Court case which used the “ABC test” to classify an individual as an employee or independent contractor. While the previous Borello & Sons, Inc. v. Department of Industrial Relations test used in California placed the burden of proof on the employee to prove misclassification using a variety of flexible, discretionary factors, the ABC test shifted the burden of proof to the employer and created a presumption of employee status.

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