Defining Who Is An Employee After A.B.5: Trading Uniformity and Simplicity for Expanded Coverage
76 Pages Posted: 10 Mar 2020
Date Written: March 10, 2020
My assessment of California’s A.B.5 differs from the evaluation advanced by the advocates and opponents of that legislation: I conclude that A.B.5 made a significant but limited expansion of the coverage of California labor law but at a notable cost. Even as A.B.5 broadened the reach of the Golden State’s labor protections, A.B.5 also made the definition of "employee” more complex and less uniform. Those seeking federal or state legislation like A.B.5 confront the same trade-off under which greater coverage is achieved at the expense of more complexity and less uniformity in the definition of who is an employee. The same political forces and policy considerations which molded A.B.5 in California will have similar effects in other states and in the halls of Congress.
Those who advocate expanding the coverage of laws protecting workers herald A.B.5 as the dawn of a new day. By codifying the “ABC” test for employment status, these advocates contend, A.B.5 properly extends legal protections to the workers of the modern economy. In contrast, opponents of A.B.5 argue that it will cripple important sectors of the U.S. economy.
A review of A.B.5 and the background from which it emerged leads to a more nuanced story than either of these simple narratives. For those who assert that current law is uncertain and too complex, A.B.5 makes matters worse. A.B.5 is replete with exceptions, exemptions and interpretive challenges which make the law of employee status even more complicated and unclear than it was before. For those who seek expanded employment-based protection for workers in the modern economy, the myriad exceptions and exemptions of A.B.5 are a sobering warning of the practical and political realities standing in the way of such expansion. For those defending the status quo, A.B.5 is an equally sober warning of considerable dissatisfaction with that status quo.
A.B.5 is thus an important data point which indicates that those who seek to reform the law of employee status face a trade-off: Efforts to expand the coverage of employment-based protection laws will make the law more complex and less uniform – as did A.B.5. Given the relevant political forces and policy considerations, legislators can broaden the reach of employment-based regulatory laws to cover more workers in the modern economy or they can simplify and unify the legal definition of employee status. They cannot do both.
Keywords: A.B.5, independent contractor, employee status, common lawcontrol test, ABC test, Uber, Lyft, Borello, Dynamex, economicrealities test
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