California Expands List of Independent Contractor Classifications

On September 4th, 2020, California Governor Gavin Newsom signed Assembly Bill (AB) 2257 into law, modifying AB 5, which was originally created to determine who can be considered a contractor and who can be considered an employee.

The new, modified version of the law took effect immediately and provides flexibility to such employment fields as freelance writers, musicians, film support crews, and visual artists, who can now continue working under the designation of independent contractors.

Background of AB 5

AB 2257 originated from Assemblywoman Lorena Gonzalez, D-San Diego, who also wrote the 2019 law known as AB 5. The initial bill was designed to support a 2018 California Supreme Court ruling that classified more workers as employees, which entitled them to benefits and other perks denied to independent contractors. Those protections included a minimum wage, overtime pay, unemployment insurance, and health benefits. AB 5 became law earlier this year.

The passage of AB 5 caused immediate problems, however, for the large freelance and independent contractor community in California. It featured items that restricted freelance writers from accepting more than 35 assignments from a single outlet and stopped musicians from regular gigs at venues.  It also affected businesses who felt they needed to stop using California-based freelancers out of fear of liability for retroactive fees and fines.

AB 5 continues to face challenges in court by gig economy companies like Uber and Postmates who want app-based drivers exempted from the new law. AB 2257 only allows exemptions specifically for freelance writers, photographers, translators, and musicians. Gig economy companies still need to follow AB 5.

Features of AB 2257

Some of the new regulations found in AB 2257 include the following:

  • The amendment eliminates the 35-submission cap for freelance writers and photographers. Previously AB 5 dictated that California-based freelancers who contribute more than 35 submissions to an outlet per year qualified as employees instead of independent contractors.
  • Translators, appraisers, and registered foresters now qualify for the “professional services” exemption. AB 5 only covered graphic designers, travel agents, and marketers, among others.
  • Music industry workers can continue to work as freelancers. The list of exemptions includes recording artists, songwriters, producers, promoters, and many others.

Employer Takeaways

The signing of AB 2257 once again signals changes in worker classification not only for California-based employers but also out-of-state employers who may use California-based freelancers. In order to avoid claims of misclassification, which can lead to lawsuits, fines, and penalties, all employers should not only become familiar with the language included in AB 2257, but also revisit AB 5 to remind themselves of the regulations that will still be in place.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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