New CA Law Offers Critical Independent Contractor Law Exemptions

California lawmakers have added critical exemptions for many music industry jobs that loosen the state’s year-old AB 5 law which limits the use of independent contractors.

From musicians and road crews to recording studio engineers, many music industry jobs have long been thought of as independent contractors,

California had established a three-part “ABC” test to determine if workers are employees or independent contractors which affected musicians and others from the music community.

The new law reverts to a system that permits most music professionals to follow the Borello test (as opposed to the Dynamex or ABC tests) to determine employment classification for both live performances and studio recordings. 

The Borello Test

Borello is referred to as a “multifactor” test because it requires consideration of all potentially relevant facts – no single factor controls the determination.

Courts have emphasized different factors in the multifactor test depending on the circumstances. For example, where the employer does not control the work details, an employer-employee relationship may be found if (1) the employer retains control over the operation as a whole, (2) the worker’s duties are an integral part of the operation, and (3) the nature of the work makes detailed control unnecessary. 

Confused yet? So were many in the music industry.

Wide Spread Industry Support

The new legislation, which was signed into law last week, is supported by the American Federation of Musicians (AFM), American Association of Independent Music (A2IM), Music Artists Coalition (MAC), Independent Music Professionals United (IMPU), International Allegiance of Theatrical Stage Employees (IATSE), the Recording Academy, Recording Industry Association of America® (RIAA), Screen Actors Guild (SAG-AFTRA), Songwriters of North America (SONA) and Teamsters Union.

In a statement, the music groups said, “This legislation ensures musicians and other creative workers can continue to live, create, and thrive in California. California’s leaders promised efforts to protect workers with a bill that would not undermine or destabilize the state’s vital music economy. Today, they have kept that promise. AB2257 restores California’s leadership as a home to the creative arts and creates clear, fair rules of the road for freelance, union, and independent artists in the state.”

The new legislation specifically provides for unions to continue to organize the work of recording artists, musicians, singers, and others, ensuring that current and future collective bargaining agreements will always govern in California.