6 ms·

Many comments are treating these results as unforeseeable consequences. But the law pretty obviously banned most contracting. You can read the conditions here.

by graeme 6y ago

Many comments are treating these results as unforeseeable consequences. But the law pretty obviously banned most contracting. You can read the conditions here. Unless the worker meets all of them, they are an employee. Part A is a pretty normal contractor condition. But Part B bans all subcontracting within an industry. Part C seems to ban people from becoming new contractors if they weren’t one already. How would you get established in a trade? Part C says you’re an employee if you’re not already so established. ———— Effective January 1, 2020, hiring entities are required to classify workers as employees unless they meet all conditions of the ABC test: 1. The person is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact. 2. The person performs work that is outside the usual course of the hiring entity’s business. 3. The person is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed. https://edd.ca.gov/Payroll_Taxes/ab-5.htm https://edd.ca.gov/Payroll_Taxes/ab-5.htm

maxsilver 6y ago
> But Part B bans all subcontracting within an industry. I don't see the problem here. It's not obvious to me that subcontracting should ever have been legal in the first place -- the majority of the time, I've generally only seen subcontracting used to do something immoral, unethical, or irresponsible. > Part C seems to ban people from becoming new contractors if they weren’t one already. Is that what it actually does? Reading it, does not seem to communicate that. It seems to be saying, "if you are a contractor, you have to actually be a contractor, and not just filling out contractor-like legal paperwork because your employer forced you to" Uber and Lyft drivers are not actual businesses, they are employees of Uber and Lyft, picking up piecework employment, and Uber and Lyft are abusing a legal loophole to not pay them fairly. But if you run "Acme Transportation LLC" and own a vehicle that you use as your own Limo Shuttle service, you would fulfill Part C, even if it's your first day of business. Uber and Lyft want everyone to pretend those two groups of people are the exact same. But they aren't the same, and I've not heard any good reason why the rest of us should pretend likewise.
- chrisseaton 6y ago
  > I've generally only regularly seen subcontracting used to do something immoral, unethical, or irresponsible For example, almost all construction is subtracted. You contract with someone for a construction project. They manage it and they subcontract to specialists to do the different parts of the job, such as electricians, plumbers, etc. What on earth is 'immoral, unethical, or irresponsible' about that?
  - maxsilver 6y ago
    > For example, almost all construction is subtracted. Yes, that was the first example that came to mind. You hire "ABC Fencebuilders" to build a fence, but without informing you, they subscontracted the job out to "BCD Fencebuilders" who subcontracted the job out to "CDE Fencebuilders". And so, if anything goes wrong, you have a half-dozen companies to deal with (none of which you actually hired, none of which you would have used if you had a choice), and no one will take actual responsibility for the situation, because they can all point to mysterious third-parties. That's what's irresponsible about that. Residential construction is rife with this, it's routinely used to screw people over. It's not necessarily a problem for someone to contract out work outside their industry or field (a carpenter might recommend hiring an electrician and/or a plumber, because a carpenter is not an electrician. All good, makes sense). But banning subcontracting within the same industry (i.e., an electrician subcontracting out their work to a different electrician) doesn't seem like a problem at all.
    - chrisseaton 6y ago
      I don't think you understand how contracting works. If I contract you, and your subcontractor messes up, I don't complain to the subtractor, I complain to you. It's up to you whether you complain to the subtractor or just get it fixed. There's no issue with 'they can all point to mysterious third-parties'. That just isn't how contract law works. You’re responsible for the work of all your subcontractors. > but without informing you They do inform you. It's completely normal and works fine. The top-level contractor is often explicitly called the 'prime contractor' with the expectation they'll do the work of finding other contractors for you. It's not a scam it's useful to consumers. I don’t want to find and manage ten different contractors - I want just one person to complain to.
sthnblllII 6y ago
Why not just let contractors chose to be employees if they want?
- soc14lism00 6y ago
  Because this isn’t about work It’s about whether they should be paid There’s a subtle but important difference These people can go be comedians on the corner all day, no one is stopping them from putting in that “work” The legal system has chosen to define work as something to be traded for. We basically took the Bible’s rules like trading some shekels and goats for a daughter and turned into modern law You’re free to do whatever mechanical work you want with your body in that context of “work” But a comedy club can’t afford to keep all these people as staff, so they don’t get to “work” within the legal, monitored, and “normalized” for appropriateness system of paid work financial capital holders approve of
  - sthnblllII 6y ago
    I dont really understand what youre point is. > The legal system has chosen to define work as something to be traded for. So people shouldn't be paid for their work? As in, we should have communism?
a1369209993 6y ago
> 3. The person is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed. My reading of this is that publishing a Doing-Business-As notice would qualify as independently establishing a business, and you would be ("is", not "has been") customarily engaged in that business as soon as you start operating it. I wouldn't trust a judge not to willfully misinterpret this if they had a reason, though.
- graeme 6y ago
  I took the emphasis to be “independently established” trade, past tense. However, I’ll asmit I have less understanding of point 3 vs. point 2. That said, this reddit post seems to indicate DBA was insufficient, and LLC rules are complex. However, I am not sure these directly address what makes for an established trade. https://www.reddit.com/r/FilmIndustryLA/comments/eurg0j/need_major_help_with_ab5_and_problems_forming_an/ https://www.reddit.com/r/FilmIndustryLA/comments/eurg0j/need... https://www.targetcw.com/blog/1099/ab5 https://www.targetcw.com/blog/1099/ab5 It seems this comes from the dynamex decision. Not clear if the judges thought through the starting point of being a contractor. They talk about seeking a license and seeking business. But I don’t know that they discussed how a business can legally hire a fresh contractor with legal certainty. There would be a legitimate fear the contractor may seek employee protections after work begins. Really we’d need legal advice on this point. I think point 2 is the strongest part of the argument I made above. https://www.californiaemploymentlawreport.com/2018/05/five-key-issues-california-employers-must-know-supreme-courts-ruling-independent-contractors/ https://www.californiaemploymentlawreport.com/2018/05/five-k...
radley 6y ago
You're only telling half of the story. Yes they overreached, but it was scaled back last week with AB 2257.

by graeme 6y ago

maxsilver 6y ago

> But Part B bans all subcontracting within an industry. I don't see the problem here. It's not obvious to me that subcontracting should ever have been legal in the first place -- the majority of the time, I've generally only seen subcontracting used to do something immoral, unethical, or irresponsible. > Part C seems to ban people from becoming new contractors if they weren’t one already. Is that what it actually does? Reading it, does not seem to communicate that. It seems to be saying, "if you are a contractor, you have to actually be a contractor, and not just filling out contractor-like legal paperwork because your employer forced you to" Uber and Lyft drivers are not actual businesses, they are employees of Uber and Lyft, picking up piecework employment, and Uber and Lyft are abusing a legal loophole to not pay them fairly. But if you run "Acme Transportation LLC" and own a vehicle that you use as your own Limo Shuttle service, you would fulfill Part C, even if it's your first day of business. Uber and Lyft want everyone to pretend those two groups of people are the exact same. But they aren't the same, and I've not heard any good reason why the rest of us should pretend likewise.

chrisseaton 6y ago
> I've generally only regularly seen subcontracting used to do something immoral, unethical, or irresponsible For example, almost all construction is subtracted. You contract with someone for a construction project. They manage it and they subcontract to specialists to do the different parts of the job, such as electricians, plumbers, etc. What on earth is 'immoral, unethical, or irresponsible' about that?
- maxsilver 6y ago
  > For example, almost all construction is subtracted. Yes, that was the first example that came to mind. You hire "ABC Fencebuilders" to build a fence, but without informing you, they subscontracted the job out to "BCD Fencebuilders" who subcontracted the job out to "CDE Fencebuilders". And so, if anything goes wrong, you have a half-dozen companies to deal with (none of which you actually hired, none of which you would have used if you had a choice), and no one will take actual responsibility for the situation, because they can all point to mysterious third-parties. That's what's irresponsible about that. Residential construction is rife with this, it's routinely used to screw people over. It's not necessarily a problem for someone to contract out work outside their industry or field (a carpenter might recommend hiring an electrician and/or a plumber, because a carpenter is not an electrician. All good, makes sense). But banning subcontracting within the same industry (i.e., an electrician subcontracting out their work to a different electrician) doesn't seem like a problem at all.
  - chrisseaton 6y ago
    I don't think you understand how contracting works. If I contract you, and your subcontractor messes up, I don't complain to the subtractor, I complain to you. It's up to you whether you complain to the subtractor or just get it fixed. There's no issue with 'they can all point to mysterious third-parties'. That just isn't how contract law works. You’re responsible for the work of all your subcontractors. > but without informing you They do inform you. It's completely normal and works fine. The top-level contractor is often explicitly called the 'prime contractor' with the expectation they'll do the work of finding other contractors for you. It's not a scam it's useful to consumers. I don’t want to find and manage ten different contractors - I want just one person to complain to.

sthnblllII 6y ago

Why not just let contractors chose to be employees if they want?

soc14lism00 6y ago
Because this isn’t about work It’s about whether they should be paid There’s a subtle but important difference These people can go be comedians on the corner all day, no one is stopping them from putting in that “work” The legal system has chosen to define work as something to be traded for. We basically took the Bible’s rules like trading some shekels and goats for a daughter and turned into modern law You’re free to do whatever mechanical work you want with your body in that context of “work” But a comedy club can’t afford to keep all these people as staff, so they don’t get to “work” within the legal, monitored, and “normalized” for appropriateness system of paid work financial capital holders approve of
- sthnblllII 6y ago
  I dont really understand what youre point is. > The legal system has chosen to define work as something to be traded for. So people shouldn't be paid for their work? As in, we should have communism?

a1369209993 6y ago

> 3. The person is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed. My reading of this is that publishing a Doing-Business-As notice would qualify as independently establishing a business, and you would be ("is", not "has been") customarily engaged in that business as soon as you start operating it. I wouldn't trust a judge not to willfully misinterpret this if they had a reason, though.

graeme 6y ago
I took the emphasis to be “independently established” trade, past tense. However, I’ll asmit I have less understanding of point 3 vs. point 2. That said, this reddit post seems to indicate DBA was insufficient, and LLC rules are complex. However, I am not sure these directly address what makes for an established trade. https://www.reddit.com/r/FilmIndustryLA/comments/eurg0j/need_major_help_with_ab5_and_problems_forming_an/ https://www.reddit.com/r/FilmIndustryLA/comments/eurg0j/need... https://www.targetcw.com/blog/1099/ab5 https://www.targetcw.com/blog/1099/ab5 It seems this comes from the dynamex decision. Not clear if the judges thought through the starting point of being a contractor. They talk about seeking a license and seeking business. But I don’t know that they discussed how a business can legally hire a fresh contractor with legal certainty. There would be a legitimate fear the contractor may seek employee protections after work begins. Really we’d need legal advice on this point. I think point 2 is the strongest part of the argument I made above. https://www.californiaemploymentlawreport.com/2018/05/five-key-issues-california-employers-must-know-supreme-courts-ruling-independent-contractors/ https://www.californiaemploymentlawreport.com/2018/05/five-k...

radley 6y ago

You're only telling half of the story. Yes they overreached, but it was scaled back last week with AB 2257.