California Governor Gavin Newsom has signed into a law a bill that codifies a controversial state supreme court decision regarding independent contractors.
Assembly Bill 5 has placed into the books a new test to determine whether an individual qualifies as an independent contractor, as outlined in the California Supreme Court decision. The controversial test has upset many industries and caused some pool/spa service firms to change their business models.
Before the bill passed, amendments were made that allow exemptions for construction contractors and some service providers.
But the law doesn’t take effect until July 1, 2020, so the so-called ABC Test outlined by the Supreme Court must be followed until then, said the California Pool & Spa Association
Ride-sharing firms such as Uber and Lyft were not able to get exemptions, though, causing them to vow a fight, potentially through referendum. Other groups have threatened lawsuits.
“This issue is far from over,” CPSA said.
