California AB-5: The Gig Law

sawdust123

DJ Extraordinaire
Nov 10, 2006
294
649
57
Ventura County, CA
On Jan 1, California enacted a law called Assembly Bill 5 (aka AB-5) that is incredible broad and sweeping in regards to employment classification. This is a money-grab by the state to collect income tax and disability holdings from just about everyone. The new employment test is called the ABC test.

A) Is the person told how and when to do their job?
B) Is the person doing work relevant to the business?
C) Does the person have their own business that is not central to the hiring business?

This bill, if not successfully challenged, is expected to decimate the entertainment industry which works mostly on gigs. Say you are a musician or DJ and you want to play at a bar. That bar now has to make you a W-2 employee. Say you are a DJ and have a gig with a difficult load-in and want to hire a helper. That helper is now a W-2 employee. Say you are a band and your drummer (who has to be an employee) is sick for a gig. His replacement has to be a W-2 employee for the one gig.

The state carved out a few exceptions for special interests. The California Trucking Authority has received a temporary injunction claiming AB-5 violates federal laws that prohibit restrictions on interstate trade. The final ruling is pending. Uber and Lyft are thumbing their noses at the law and are prepared for a prolonged court battle. No one is stepping up for gigging musicians and DJs. Worse yet, other states are looking to emulate the law to fill their tax coffers as well.

California has never been very friendly to businesses but this law is crazy. It will drive Hollywood out of state if not successfully challenged. Hopefully we can recall the governor and those that voted for this insane bill. I am curious if anyone here on the left coast has felt the sting of this law yet.
 

Scott Hanna

DJ Extraordinaire
Oct 25, 2006
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Cleveland, OH
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I've already heard that many companies won't hire any consultants, online writers, or or online editors from California. it's much easier to hire someone from a different state.

Great job, California!
 
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DJ Ricky B

DJ Extraordinaire
Mar 9, 2015
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California is a lost cause.

So many people refuse to leave the state because they love the weather there. ....That is just about the only reason they continue to stay. I know lots of them. They all complain about the cost of EVERYTHING there. They all complain about the TAXES. They all complain about the ever growing homeless population. Some of them complain about the over population due to illegal immigration. They complain about the registration fees for a vehicle. Everything is expensive there.

Yet many of them continue to Vote Democrat, AND continue to stay in the state even though they feel and notice their standard of living declining year after year living there. :hammerhead:

They have water shortages, and earth quakes...only a matter of time before the next 8.0 or higher hits out there...

...The state government is not going to change, the laws are going to get worse, the taxes will get worse, Rent will continue to sky rocket, and buying a home will continue to be harder to do out there. So why continue to live there? Good Weather/Sun Shine is simply what it's all about? Maybe the legal weed now?
 

DJ Ricky B

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Mar 9, 2015
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Weird .. I know people here that complain about the very same things and they continue to stay here too. Must be the weather we have. ;)
California is considerably more expensive. Although, I will say that Maryland is becoming more like California as time marches on. I certainly won't be retiring here when I am older.
 

djtaso

DJ Extraordinaire
Apr 4, 2017
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NJ
www.djtaso.com
On Jan 1, California enacted a law called Assembly Bill 5 (aka AB-5) that is incredible broad and sweeping in regards to employment classification. This is a money-grab by the state to collect income tax and disability holdings from just about everyone. The new employment test is called the ABC test.

A) Is the person told how and when to do their job?
B) Is the person doing work relevant to the business?
C) Does the person have their own business that is not central to the hiring business?

This bill, if not successfully challenged, is expected to decimate the entertainment industry which works mostly on gigs. Say you are a musician or DJ and you want to play at a bar. That bar now has to make you a W-2 employee. Say you are a DJ and have a gig with a difficult load-in and want to hire a helper. That helper is now a W-2 employee. Say you are a band and your drummer (who has to be an employee) is sick for a gig. His replacement has to be a W-2 employee for the one gig.

The state carved out a few exceptions for special interests. The California Trucking Authority has received a temporary injunction claiming AB-5 violates federal laws that prohibit restrictions on interstate trade. The final ruling is pending. Uber and Lyft are thumbing their noses at the law and are prepared for a prolonged court battle. No one is stepping up for gigging musicians and DJs. Worse yet, other states are looking to emulate the law to fill their tax coffers as well.

California has never been very friendly to businesses but this law is crazy. It will drive Hollywood out of state if not successfully challenged. Hopefully we can recall the governor and those that voted for this insane bill. I am curious if anyone here on the left coast has felt the sting of this law yet.
In Jersey they were about to vote for the same thing to take effect in 2020... last minute, after numerous protests and calls being made, it seemed they didn’t have the votes and I guess is now in limbo. Same complaints, same industries... both states very democratic here... but somehow here there was enough complaining to delay this for a little while longer.

Personally I don't really have subcontractors, but know many other companies who primarily only subcontract, and can see it being a big issue.
 

djtaso

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Apr 4, 2017
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California is considerably more expensive. Although, I will say that Maryland is becoming more like California as time marches on. I certainly won't be retiring here when I am older.
I think you got a long way to go down there before becoming like CA lol. At least you can buy a house for a very reasonable price... and your property taxes are nonexistent compared to CA and NJ. Just a quick search for a property in Bel Air, MD (I have a friend there who tells me how cheap everything is)... $390k for a 4500sq ft home w/ $4500/yr property taxes... equivalent quality home (actually 500sq ft smaller) in NJ suburb about 1hr from a major city... $950,000 w/ $18k property taxes.
 

tunes4046

DJ Extraordinaire
Jul 24, 2008
4,340
6,652
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Fennimore Wi
I think you got a long way to go down there before becoming like CA lol. At least you can buy a house for a very reasonable price... and your property taxes are nonexistent compared to CA and NJ. Just a quick search for a property in Bel Air, MD (I have a friend there who tells me how cheap everything is)... $390k for a 4500sq ft home w/ $4500/yr property taxes... equivalent quality home (actually 500sq ft smaller) in NJ suburb about 1hr from a major city... $950,000 w/ $18k property taxes.
You should see what $390k will buy you in rural Wisconsin
 

Hank Davidson

Affordable, yet priceless.
Nov 15, 2006
7,308
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Boston, MA
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So, if I want to make some extra cash as a drug mule, sex worker or lawn care assistant, I can expect to receive a W-2? :laugh:

See, the "Catch 22" is that these kinds of squeezes happen because too many people are working off the books. But people are working off the books to avoid these squeezes.
 

Ausumm

No Matter Where You Go... There You Are!
Oct 21, 2008
10,988
12,143
56
Bethlehem PA
California is a lost cause.

So many people refuse to leave the state because they love the weather there. ....That is just about the only reason they continue to stay. I know lots of them. They all complain about the cost of EVERYTHING there. They all complain about the TAXES. They all complain about the ever growing homeless population. Some of them complain about the over population due to illegal immigration. They complain about the registration fees for a vehicle. Everything is expensive there.

Yet many of them continue to Vote Democrat, AND continue to stay in the state even though they feel and notice their standard of living declining year after year living there. :hammerhead:

They have water shortages, and earth quakes...only a matter of time before the next 8.0 or higher hits out there...

...The state government is not going to change, the laws are going to get worse, the taxes will get worse, Rent will continue to sky rocket, and buying a home will continue to be harder to do out there. So why continue to live there? Good Weather/Sun Shine is simply what it's all about? Maybe the legal weed now?
People move to....stay there...and vote Democratic in California
because they agree with (most of) what their government is trying to accomplish.
They are okay with paying more, to get things like cleaner air.
They want to do their part to make the world a better place.

I do agree that the government quite often take things too far.
 

wifedj

DJ Extraordinaire
Mar 20, 2008
2,723
3,609
On Jan 1, California enacted a law called Assembly Bill 5 (aka AB-5) that is incredible broad and sweeping in regards to employment classification. This is a money-grab by the state to collect income tax and disability holdings from just about everyone. The new employment test is called the ABC test.

A) Is the person told how and when to do their job?
B) Is the person doing work relevant to the business?
C) Does the person have their own business that is not central to the hiring business?

This bill, if not successfully challenged, is expected to decimate the entertainment industry which works mostly on gigs. Say you are a musician or DJ and you want to play at a bar. That bar now has to make you a W-2 employee. Say you are a DJ and have a gig with a difficult load-in and want to hire a helper. That helper is now a W-2 employee. Say you are a band and your drummer (who has to be an employee) is sick for a gig. His replacement has to be a W-2 employee for the one gig.

The state carved out a few exceptions for special interests. The California Trucking Authority has received a temporary injunction claiming AB-5 violates federal laws that prohibit restrictions on interstate trade. The final ruling is pending. Uber and Lyft are thumbing their noses at the law and are prepared for a prolonged court battle. No one is stepping up for gigging musicians and DJs. Worse yet, other states are looking to emulate the law to fill their tax coffers as well.

California has never been very friendly to businesses but this law is crazy. It will drive Hollywood out of state if not successfully challenged. Hopefully we can recall the governor and those that voted for this insane bill. I am curious if anyone here on the left coast has felt the sting of this law yet.
Not surprising for a state that elects and sends to Congress Nancy "Poor Me...another shot" Pelosi, Adam "Pencilneck" Schiff, Mad Maxine "Tainted" Waters, Eric "Pooter" Swawell, Kamala "The Fellatrix" Harris, and Diane "The Corruptess" Feinstein.

As ye sow, so shall ye reap.

Sux2BCali!
 
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wifedj

DJ Extraordinaire
Mar 20, 2008
2,723
3,609
So, if I want to make some extra cash as a drug mule, sex worker or lawn care assistant, I can expect to receive a W-2? :laugh:

See, the "Catch 22" is that these kinds of squeezes happen because too many people are working off the books. But people are working off the books to avoid these squeezes.
Why is the Gov't in the squeeze business and why do you defend, surrender to the belief that they are some how entitled to establish how much of my earned income they want to take?
 

Jeff Romard

Administrator
Staff member
Sep 4, 2006
18,307
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Sydney, Nova Scotia
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Hank Davidson

Affordable, yet priceless.
Nov 15, 2006
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Boston, MA
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Why is the Gov't in the squeeze business and why do you defend, surrender to the belief that they are some how entitled to establish how much of my earned income they want to take?
Where did I defend the government? I just made an observation.
 

DJ Ricky B

DJ Extraordinaire
Mar 9, 2015
5,830
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I think you got a long way to go down there before becoming like CA lol. At least you can buy a house for a very reasonable price... and your property taxes are nonexistent compared to CA and NJ. Just a quick search for a property in Bel Air, MD (I have a friend there who tells me how cheap everything is)... $390k for a 4500sq ft home w/ $4500/yr property taxes... equivalent quality home (actually 500sq ft smaller) in NJ suburb about 1hr from a major city... $950,000 w/ $18k property taxes.
$390,000 is expensive. Un-obtainable for more than half of the work force. $950,000. Realistically, only the top 1.5% income earners can afford that.

Plenty of smaller properties in Maryland that cost just as much as in New Jersey, if not more on the price tag. % of property tax may be less though. North Eastern states generally have the highest property taxes. High property taxation is theft!

Here are a few for you

17.5 Million dollars...

1701 Sq. Feet...Almost a Million Dollars...

Here is a suburb of Baltimore...Almost a million dollars for 3,300 sq feet. Nice pool and nice looking yard though




Maryland is far from cheap. You can find plenty of large 3,500+ sq foot houses with a lot of land for 225K or less down south in many areas. That is not happening in Maryland. ....MAYBE the far west region of Maryland near West VA, MAYBE a old house that might need updating/ffixing...But then you are living so far from any job source, nobody really wants to live out there.

My Mortgage is less than $1,000 a month. It was less than $600, but we refinanced last year. Cut 3 years of pay off time on our mortgage, and paid off all my wife's credit debt.

I could not fathom trying to afford a 390K home, let alone a 950K home. That is just nuts. My parents paid $39,990 back in the 70s for their first home down in the area not far from those first 3 homes I linked here. ...I know people paying $2,200+ a month in RENT for an apartment...to me, that is insane.
 

djtaso

DJ Extraordinaire
Apr 4, 2017
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$390,000 is expensive. Un-obtainable for more than half of the work force. $950,000. Realistically, only the top 1.5% income earners can afford that.

Plenty of smaller properties in Maryland that cost just as much as in New Jersey, if not more on the price tag. % of property tax may be less though. North Eastern states generally have the highest property taxes. High property taxation is theft!

Here are a few for you

17.5 Million dollars...

1701 Sq. Feet...Almost a Million Dollars...

Here is a suburb of Baltimore...Almost a million dollars for 3,300 sq feet. Nice pool and nice looking yard though




Maryland is far from cheap. You can find plenty of large 3,500+ sq foot houses with a lot of land for 225K or less down south in many areas. That is not happening in Maryland. ....MAYBE the far west region of Maryland near West VA, MAYBE a old house that might need updating/ffixing...But then you are living so far from any job source, nobody really wants to live out there.

My Mortgage is less than $1,000 a month. It was less than $600, but we refinanced last year. Cut 3 years of pay off time on our mortgage, and paid off all my wife's credit debt.

I could not fathom trying to afford a 390K home, let alone a 950K home. That is just nuts. My parents paid $39,990 back in the 70s for their first home down in the area not far from those first 3 homes I linked here. ...I know people paying $2,200+ a month in RENT for an apartment...to me, that is insane.
Bethsesda isn’t comparable to what I was showing though. I was showing you one of the cheaper towns in NJ about an hour from NYC. If you want to come to north jersey... $500k doesn’t even get you 1000sq ft in some of the towns closest to NYC.
 

Jeff Romard

Administrator
Staff member
Sep 4, 2006
18,307
14,427
49
Sydney, Nova Scotia
.. $500k doesn’t even get you 1000sq ft in some of the towns closest to NYC.
You could possibly get 5 maybe 6 here for a half million.
 

DJ Ricky B

DJ Extraordinaire
Mar 9, 2015
5,830
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Bethsesda isn’t comparable to what I was showing though. I was showing you one of the cheaper towns in NJ about an hour from NYC. If you want to come to north jersey... $500k doesn’t even get you 1000sq ft in some of the towns closest to NYC.
I visited a friend who lived in Hoboken, NJ way back in 2005. I would have no desire to EVER live there. I also got a ride through Patterson, NJ. ...What a $hithole...pardon my french. My friend had his car broken into twice while he was working in Patterson. At the time, my friend told me the crap hole houses with two families living in them in Patterson were going for over $400,000. I thought that was ridiculous back then...I am sure 15 years later it is more ludicrous

Toms River is nice. Also very expensive! You won't ever catch me move north...Mainly because of the weather, but also because there simply is not any place that would make financial sense to move there.