February 5, 2023

Volume XIII, Number 36

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February 03, 2023

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California Governor Signs Legislation to Relax Controversial Independent Contractor Law

California Governor Gavin Newsom recently signed legislation, AB 2257, that provides a carve out to the state’s independent contractor law. Under Assembly Bill 5, all independent contractors are presumed to be employees unless the hiring business can meet the stringent requirements (known as the ABC test) that are set forth in the California Supreme Court’s Dynamex decision. AB 5 also provided for certain exemptions for certain categories of workers. For a more in depth discussion of AB 5, visit our previous blog post here.

AB 2257 provides new exemptions for additional types of workers, including music industry professionals; performing artists; freelance writers and photographers; individuals who provide underwriting inspections, premium audits, risk management or loss-control work for insurance or financial services industries; and performance artists. As such, more individuals will be able to work as independent contractors, and those who hire them will not be subject to the stringent workplace protection laws that apply to California employees.

The new law also provides clearer instruction on the “business-to-business” exception of AB 5 by stating that a business that is contracted to provide services to another business is an independent contractor if it meets the factors established in the California Supreme Court’s decision in S.G. Borello & Sons, Inc., which is less restrictive than the ABC test. Contracting businesses can include public agencies and quasi-public corporations.

AB 2257 was signed on September 4, 2020. Its provisions took effect immediately.

Copyright © 2023, Hunton Andrews Kurth LLP. All Rights Reserved.National Law Review, Volume X, Number 267

About this Author

Katherine Sandberg Employment Lawyer Hunton Andrews Kurth Law Firm

Katherine has extensive experience in wage and hour class actions and high-stakes trade secrets litigation. She also has a demonstrated track record of favorable outcomes in federal and state courts for clients facing claims of discrimination, harassment, retaliation and unfair competition. Moreover, she has guided clients through difficult interactions with administrative agencies and claimants to resolve disputes before lawsuits are ever filed.

Katherine also has significant experience defending business owners in public accommodation access litigation involving claims of...

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Roland M. Juarez Employment & Labor Attorney Hunton Andrews Kurth Los Angeles, CA

Roland’s practice focuses exclusively on employment and labor law.

Roland has exclusively handled employment cases since 1992. He was named a 2020 Top Minority Attorney in Los Angeles and a 2019 Top Litigator & Trial Lawyer, both by the Los Angeles Business Journal; a California Labor and Employment Star and was nominated as California's top Labor & Employment Litigation Attorney in 2019, both by Benchmark Litigation. Hunton’s California Employment Group was also nominated as the California Employment Group of the Year in 2019 by Benchmark. Roland’s experience includes class...