Briefly, AB5 outlaws independent contractors. Computer consultants, translators, audio technicians, independent truckers, graphic artists, writers, and some performers. It mandates that they must be employees and from my own experience, that’s usually a cut in pay because companies don’t always need these services full time, or on a frequent basis. Independent contractors sometimes work for many companies at once, doing a little here, a little there. Some of us enjoy that.
Unions backed AB5, and while unions often protect workers, in this case they are hurting workers who are no threat to them. Unions donate to politicians, of course, and in the end, money talks.
Some workers are forced to incorporate in some form to continue working, but this means extra taxes for doing that plus increased costs for accounting fees. I’ve experienced this first hand. We pay our taxes on income, but now there is an extra tax just because we are independent.
And be aware that our Representative in the U.S. House voted for this at the national level (PROact), a vote against independent contractors who did him no harm, but also didn’t donate enough.
Note that lawyers and real estate agents are exempt from the law. Many politicians are lawyers. And check out who donated to our Representative.
For more, see AB5 Stories.