AB 2257 of 2020 BECOMES LAW – “AB 5 FIX” BILL IMPROVES “BUSINESS TO BUSINESS EXEMPTION” FOR LTOS AND LOG TRUCKERS – AND FULLY EXEMPTS RPFS FROM DYNAMEX ABC TEST FOR INDEPENDENT CONTRACTOR STATUS
The two-year 2019-2020 Legislative Session ended on August 31.
One bill that made it to Governor’s desk was Assembly Bill 2257 of 2020. The Governor signed this bill immediately and because it is an “urgency” measure, it became state law on the day he signed it, September 4, 2020, rather than waiting until January 1, 2021 to take effect.
AB 2257 of 2020 ends up being the “major bill” to “fix” problems with Assembly Bill 5 of 2019, passed and signed into law the year before.
ACL has been keeping its members informed as to how to use the “Business to Business Exemption” in AB 5 so as to be exempt for the strict “ABC Test”born of the Dynamex case decision of 2018. ACL leadership believes that “unless and until LTOs and log truckers can get a full exemption from AB/Dynamex,” the “Business to Business Exemption” is our best bet for proving when our workers are independent contractors and not employees.
Assembly Member Lorena Gonzalez (D-San Diego) is the author of both AB 2257 of 2020 and AB 5 of 2019. Though the year 2020 began with over 30 bills “to fix AB 5″(and some, to abolish it), in the final week of the session, it all boiled down to one bill in the main: AB 2257. This bill is mainly about exemptions for the music industry, writers and performers, but we worked on provisions for our industry.
ACL leadership was involved with the timber industry in negotiations with Assembly Member Gonzalez and with the labor representatives who are among the sponsors of AB 5 and AB 2257.
The outcome: Assembly Member Gonzalez and labor COULD “see their way clear” to offer a “straight exemption” to Registered Professional Foresters(because they work mainly as consultants without “crews” and are not engaged in “high hazard work”), but COULD NOT see their way clear to fully exempt LTOs and log truckers.
However: Discussions between ACL and other timber industry associations yielded this belief about AB 2257 as it has been signed into law by Governor Newsom:
ONE: The “business to business exemption” from AB 5 and the Dynamex “ABC” test was ALREADY usable by logging companies to prove that their workers are independent contractors(when they fit the exemption.)
TWO: AB 2257 has ADDED some IMPROVEMENTS to the “Business to Business Exemption” that SHOULD MAKE IT EVEN BETTER TO USE to prove “independent contractor” status.
THREE: Legal decisions in early 2020 (currently still pending in the courts for further action) have exempted certain types of log trucking from the Dynamex “ABC” test.
FOUR: There may be future exemptions to AB 5 in the 2021-2022 legislative session that begins in January of 2021.
Associated California Loggers will be mailing out new information to our members soon about “how AB 2257 of 2020” improves the business to business exemption in AB 5 of 2019.
You can contact the ACL office at 916-441-7940 or firstname.lastname@example.org NOW to obtain such items as a “contract template” and other “business to business exemption” materials.
ACL will be watching the “future of AB 5” as detailed in the attached link to the column “Death Throes for AB 5?,” including the fate of Proposition 22 on the November 2020 state ballot(this Proposition would exempt Uber, Lyft, and Doordash services from the Dynamex ABC Test.)
ONE: To AB 2257 and its signing statement:
TWO: To three “legislative analyses” of AB 2257 with further information(marked in ink):
THREE: To the September 8, 2020 “Fox and Hounds” column: “Death Throes for AB 5?”
PLEASE NOTE: While Associated California Loggers has confidence that these materials and opinions are helpful to using the “Business to Business Exemption” under AB 5 and AB 2257, we urge you to talk to an attorney or an accountant for further advice.