Fate of Two Million California Workers Gets a Hearing, Tomorrow

Date: April 23, 2019

Legislature still grappling with State Supreme Court’s Dynamex Decision

FOR IMMEDIATE RELEASE
Contact: John Kabateck, California State Director, 916-956-9027, [email protected],
or Shawn Lewis, Legislative Director, 916-342-9315; [email protected],
or Luke Wake, Staff Attorney, NFIB Legal Center, 916-384-7648, [email protected]

SACRAMENTO, April 23, 2019—In the one-year-anniversary week of the California Supreme Court’s Dynamex decision, the Senate Labor, Public Employment and Retirement Committee will take up Senate Bill 238, tomorrow, Wednesday, April 24, when it sits down for business at 9:30 a.m. in Room 2040 of the State Capitol.

According to the Legislative Counsel, the court’s “decision puts the livelihood of nearly 2,000,000 Californians who choose to work as independent contractors at risk. The decision eliminates the choice that more and more Californians are making for their work and quality of life. The decision moves the state backwards and does not accurately reflect today’s realities, including the changing demands of the modern workforce.”

The Supreme Court’s Dynamex decision was made April 30, 2018. By establishing a new ABC test, the decision overturned 29 years of precedence set down in the Borello case,” according to the legislative counsel. Two measures currently circulating in the California State Legislature, Assembly Bill 5 and Senate Bill 238, address the Dynamex decision.

NFIB supports SB 238 because it accounts for economic realities. It provides strong protection for workers. But at the same time, it distinguishes between workers who are actually dependent on the hiring entity and those who have established themselves as legitimate businesses. And because the rules surrounding these classification issues are complicated enough, it makes sense to have one consistent approach when we’re dealing with wage and hour issues. For that reason alone, it would be good public policy to align the California standard with the U.S. Department of Labor’s standard.

“Small business would prefer to see Senate Bill 238 become law,” said John Kabateck, California state director for NFIB, the state’s leading small-business association. “It calls for using the federal Fair Labor Standards Act to determine employment status. Right now, Assembly Bill 5 would still leave the self-employed in limbo, and quite frankly, I believe AB 5’s special carve-outs for certain insurance occupations, physicians, securities broker-dealers, and direct salespeople show how badly flawed this proposal is.”

Background Information

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For more than 75 years, NFIB has been advocating on behalf of America’s small and independent business owners, both in Washington, D.C., and in all 50 state capitals. NFIB is a nonprofit, nonpartisan, and member-driven. Since our founding in 1943, NFIB has been exclusively dedicated to small and independent businesses and remains so today. For more information, please visit nfib.com.

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