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In September of last year, California Governor Gavin Newsom signed Assembly Bill 5 (AB5) into law. Newsom also designated $20 million of the state budget to enforce the bill. What was claimed to be an attempt to help freelance workers, ended up hurting millions of hard-working Californians.

Assembly Bill 5 requires companies that hire independent contractors to reclassify them as employees, unless the employer can prove that the worker meets strict criteria.

Since the enactment of this legislation, some businesses have reclassified all or some of their independent contractors as employees, and in turn had to transfer the costs to their customers or cut employee pay, others have cut ties with California-based freelancers to avoid the extra costs and complications.

Vox Media terminated hundreds of freelance writers in California in order to comply with the bill. Some Californians have even left the state in order to continue driving for Uber or Lyft as independent contractors.

In response to the job-killing new law, DoorDash, Uber, Lyft, and other companies have taken a stand, supporting a ballot initiative campaign known as the “Protect App-Based Drivers and Services Act.” The measure would allow them to keep their workers as independent contractors, while adding more worker protections.

The initiative surpassed the required 623,000 signature mark, hitting 1 million signatures and will be on the ballot in November.

“Gig” employment has flourished in recent years and is expected to double within the next 4 years.

Incredibly, AB5’s damage would be even worse, if not for a number of industries getting exemptions, or restraining orders so they do not have to comply with the new rules.

California has also been sued over AB5 by the American Society for Journalists and Authors (ASJA) for attacking freedom of the press.   

California voters will have the opportunity in November to take a stand against AB5. Ultimately, full repeal is required to end government interfering with independent contractors and forcing a traditional work model for companies that were not intended to operate that way. Unfortunately, Rep. Kevin Kiley’s repeal bill stalled this session.