Assembly Bill 2257: New, New Worker Classifications
On Friday, September 4, 2020, Governor Gavin Newsom signed Assembly Bill 2257 (“AB 2257”)[i] into law[ii], which attempts to clean up and clarify worker classifications codified by AB 5 last year in California. AB 2257 goes into effect immediately and applies to “work performed on or after January 1, 2020.”[iii]
For the most part, a lot of what AB 5 codified still remains in effect. For example: (1) ‘employee’ is still the rebuttable presumptive worker classification; (2) the ABC Test still determines whether an employer can rebut the presumptive classification; (3) there is no exemption for workers who wish to be hired/classified as independent contractors; and (4) the multi-factor test in Borello[iv] is still the fallback standard for those workers where AB 2257 is not applicable.
Despite the lack of a performing arts exemption, there were some good things that came out of the passage of AB 2257. For instance, there’s now an exemption for single-engagement events, which the law defines as “a stand-alone non-recurring event in a single location, or a series of events in the same location no more than once a week.”[v] Remember when we were all upset that open mic nights now had to involve I-9s and W-2s and signing up for payroll all just to hear another cover of “Yesterday?” There is a list of criteria that must be met to clear the exemption, but this clean-up bill makes it possible to plan an evening of live performance without a payroll account.
Also, there’s now an exemption for individual performance artists. Unfortunately, the law does not allow for this exemption to be applied to performing artists “participating in a theatrical production,” but it does apply to individuals “performing comedy, improvisation, stage magic, illusion, mime, spoken word, storytelling, or puppetry.”[vi] Again, there are criteria that must be met to be considered an individual performance artist under the law, but this is definitely an expansion over the strict purview of AB 5.
Another gem: there’s a new exemption for specialized performers[vii] who teach master classes. The classes can’t be longer than a week and the ‘master class’ has to be a special offering from the performing arts company that is not regularly offered, but this opens up the discussion for teaching artists and visiting artists and performing arts organizations to offer unique, one-of-a-kind classes to their community members without always having to make those artists employees.
There is a lot packed into the new law, especially for musicians and recording artists, but the last big item for the performing arts industry was the controversy over who was considered a fine artist. AB 2257 has codified the definition of a fine artist as “an individual who creates works of art to be appreciated primarily or solely for their imaginative, aesthetic, or intellectual content, including drawings, paintings, sculptures, mosaics, works of calligraphy, works of graphic art, crafts, or mixed media.”[viii] While not great news for performance artists who wanted their form of artistic expression to be included, this definition is consistent with preexisting definitions of fine artist found in other areas of California law,[ix] and at least now there is a definition rather than speculation.
AB 2257’s exemptions have a lot of criteria that employers must meet in order for workers to fall under the multi-factor test from Borello. Each contracting business should analyze their worker classifications against the criteria and requirements that AB 2257 lays out to ensure that they meet an exemption’s requirements and that their workers are not misclassified.
[i] See, AB 2257 Legislative Counsel’s Digest, https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200AB2257. [ii] See, https://deadline.com/2020/09/governor-gavin-newsom-signs-ab-2557-helping-independent-contractors-1234571287/. [iii] Supra, Note i; see soon-to-be codified Cal. Lab. Code § 2785(c). [iv] S. G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341. [v] Supra, Note i; see soon-to-be codified Cal. Lab. Code § 2779. [vi] Supra, Note i; see soon-to-be codified Cal. Lab. Code § 2780(c). [vii] Supra, Note i; see soon-to-be codified Cal. Lab. Code § 2778(b)(2)(M). [viii] Supra, Note i; see soon-to-be codified Cal. Lab. Code § 2778(b)(2)(F)(ii). [ix] See, Cal. Civ. Codes §982(d)(1)-(2), §986(c), §987(b), §989(b), §997, §1378, and §1740.