AB 1514

Existing law requires a 3-part test, commonly known as the "ABC" test, to determine if workers are employees or independent contractors for purposes of the Labor Code, the Unemployment Insurance Code, and the wage orders of the Industrial Welfare Commission. Under the ABC test, a person providing labor or services for remuneration is considered an employee rather than an independent contractor unless the hiring entity demonstrates that the person is free from the control and direction of the hiring entity in connection with the performance of the work, the person performs work that is outside the usual course of the hiring entity's business, and the person is customarily engaged in an independently established trade, occupation, or business. Existing law charges the Labor Commissioner with the enforcement of labor laws, including worker classification.

Existing law exempts specified occupations and business relationships from the application of the ABC test described above. Existing law, instead, provides that these exempt relationships are governed by the multifactor test previously adopted in the case of S. G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341. Existing law includes an exemption for services provided by a licensed manicurist, subject to the manicurist meeting specified conditions, and makes this exemption for licensed manicurists inoperative on January 1, 2025.

This bill would delete the January 1, 2025, inoperative date, and, instead, until January 1, 2029, reapply the above-specified exemption to certain licensed manicurists. The bill would also require the Employment Development Department and the Division of Labor Standards Enforcement to, by June 1, 2026, report to the Legislature the annual number of allegations of misclassification or other specified violations involving licensed manicurists since January 1, 2020, as specified.

Existing law also provides an exemption for a commercial fisher working on an American vessel, as defined. Existing law makes those commercial fishers eligible for unemployment insurance benefits subject to certain conditions, and requires the Employment Development Department to issue an annual report, on March 1, to the Legislature on the use of unemployment insurance in the commercial fishing industry, as provided. Existing law makes these various provisions related to commercial fishers working on an American vessel inoperative on January 1, 2026.

This bill would extend the inoperative date to January 1, 2031, and, thereby, until January 1, 2031, reapply the above-specified exemption to those commercial fishers, as prescribed. The bill would change the above-described annual reporting date from March 1 to June 30.