In 2018, the California Supreme Court issued a the landmark decision related to employment law in its ruling Dynamex Operations West, Inc. v. Superior Court, 4 Cal. 5th 903 (2018). Under Dynamex (pronounced “dyNAMix”), the California Supreme Court revised the test used to determine whether a worker is an independent contractor to what is called the “ABC test.”
On January 1, 2020, California Senate Bill AB5 (i.e. Labor Code section 2750.3) went into effect. This law codified, expanded upon, and provided exemptions to the ABC test.
Under AB5, a worker in California is presumed to be an employee for the purposes of wage, hour, and workers’ compensation laws unless the employer can prove all of three factors:
A. The worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact.
B. The worker performs work that is outside the usual course of the hiring entity’s business.
C. The worker is customarily engaged in an independently established trade, occupation or business of the same nature as the work performed for the hiring entity.
These factors are what are collectively referred to as the “ABC” test.
A number of industries negotiated exemptions to AB5 which are incorporated into the text of the law itself. However, the music industry and musicians are not currently exempt. The reason being that the various music industry organizations involved in lobbying to negotiate an exemption were unable to agree on the exemption language in time for the bill to be passed.
On April 17, 2020, a coalition led by the MAC (Music Arts Coalition) announced that it reached an agreement on the language for an exemption to AB5 for the music industry and musicians. The coalition included the RIAA (Recording Industry of America), A2IM (American Association of Independent Music), and SONA (Songwriters of North America). If passed into law, this exemption will provide significant relief to musicians who look and act like independent contractors, yet are treated as employees under the law, as well as those who employ them.
