CA Senate Passes AB 5 Despite Pleas From Independent Businesses

‘This bill is the union caucus’ main event of the year.’

The California State Senate approved Assembly Bill 5 by Assemblywoman Lorena Gonzalez (D-San Diego) late on Tuesday evening, which most say will serve to significantly limit Californians’ ability to work as independent contractors. It was revealed during Senate debate that the AFL-CIO wrote AB 5.

Assembly Bill 5  by Assemblywoman Lorena Gonzalez (D-San Diego) could destroy California’s Gig economy if passed and signed into law. The Gig economy includes ride-share businesses like Uber and Lyft, and food delivery services Postmates and DoorDash – and apparently many more independent business groups.

Members of the California Senate Republican Caucus offered 11 different sets of amendments to AB 5 to provide exemptions for additional industries, responding to the many industries already exempted by Gonzalez’s bill: forestry, health care professionals, newspapers carriers and distributors, physical therapists, interpreters, translators, single truck owner-operators, non-profits, franchisors, franchisees, and design, excluded from AB 5.

However, Senate Democrats blocked every one of the amendment efforts.

.@SenBrianJones just presented my amendment which would have given additional time to comply for industries who will be hurt by #AB5 in its current form.

It was AGAIN blocked by #CADems. #CADeservesBetter #DymamexDecision #CALeg pic.twitter.com/v8J7YjTehZ

— Senator Shannon Grove (@ShannonGroveCA) September 11, 2019

Each of the Senate Republicans, and a few of Senate Democrats spoke against AB 5 warning it would destroy the businesses of small, independent business operators from many industries.

Senate Republicans present 12 sets amendments for @LorenaAD80 AB 5, which would kill ride-share biz, would kill many other indp. contractors biz: non-profit orgs, forest practices, health workers, franchises, translators, pt taxi drivers, PTs, newspaper carriers. (1/2)

— Katy Grimes (@KATYSaccitizen) September 11, 2019

Of the 11 sets of amendments, all of which were defeated in a Senate rule game play by Sen. Robert Hertzberg (D-Los Angeles), who opposed each amendment through a motion to “lay the amendments on the table,” killing the Republican Senators’ amendment Senators expressed frustration with the lack of understanding or compassion for independent contractors.

“I opposed Assembly Bill 5 because it undermines the principle of equal treatment under the law and deprives many Californians the right to be their own bosses,” Sen. Patricia Bates (R-Laguna Niguel) said. “The bill’s Christmas tree of exemptions is a prime example of the Legislature picking winners and losers. Why should some people enjoy an exemption while others such as newspaper carriers and language interpreters and translators do not?”

“In regard to newspapers, one editorial quoted a former newspaper publisher in Mendocino County stating, ‘A newspaper is … the closest anyone will ever get to holding democracy in their hands.’ And the editorial then opined, ‘This bill (AB 5) threatens to rip that piece of democracy right out of our grip.’ I offered an amendment to fix this specific problem with AB 5. It’s unfortunate that Senate Democrats rejected it on a partisan vote.”

Sen. Steven Glazer (D-Orinda) said AB 5 “goes about the task in the wrong way. We should be writing rules to protect workers.” Glazer warned against regulating self-made business owners of any size.

Sen. Bates noted, “Editorial boards throughout the state, including the Orange County Register, San Diego Union-Tribune, Sacramento Bee, and San Jose Mercury News said AB 5 would endanger the newspaper industry. Senate Democrats rejected Senator Bates’ amendment. Under pressure to do something in order to gain enough votes for AB 5 to pass tonight, the Senate will consider Assembly Bill 170 (Gonzalez) later this week that will delay implementation of AB 5 for one year for newspaper carriers and distributors.”

Senators said AB 5 opens the door to targeting employers who use independent contractors legitimately, with lawsuits. “AB 5 is a way to force people out of careers they love,” Sen. Brian Dahle (R-Bieber) said. Dahle shared that his own business would be subjected to state disciplines under AB 5 because in his farming business he has his own independent trucking operation, as well as using other truckers. Dahle expressed frustration that few in the Senate seem to understand or even care that his business, and many others, would likely be targeted by state regulators if AB 5 passed.

Sen. Jeff Stone echoed the same, as a 30-year pharmacist who always dreamed of owing his own chain of pharmacies. Stone said he worked four jobs after graduate school until he was able to save the money necessary to open his first pharmacy, dreaming of the day he could build on that first one. He said he achieved he American dream because his parents and grandparents before him worked hard as well. Stone warned that AB 5 was “picking winners and losers,” rather than allowing the free market to decide.

“Two of the pharmacies I owned I unionized,” he said, noting the great benefits and wages were worth it. However, he warned that it was his decision to do this, in the best interest of his employees.

“This bill is the union caucuses’ main event of the year,” Sen. Stone said.

Following the Senate vote, Sen. Jim Nielsen (R-Tehama) said in a press release, “Along party lines, Sacramento Democrats ended millions of Californians’ ability to earn a living while working flexible hours that fit their schedules. Citing the support of groups that received special exemption from the legislation, Sacramento Democrats passed Assembly Bill 5, a measure to redefine the definition of “employee” and require millions of independent contractors to be classified as employees.”

“California has become a hostile place to do business,” Sen. Nielsen said. “Tonight, the Legislature turned this hostility toward millions of independent contractors. With the exception of a few professions, Assembly Bill 5 will restrict a worker’s ability to work flexible hours that fit their needs. The quality of life will change for many families who rely on the flexibility to tend to children and/or their elderly relatives. North state residents have loudly expressed their concerns.”

Senator Nielsen’s office reported they received 770 correspondences regarding AB 5 and only 33 supported this measure. AB 5 now moves back to the Assembly for concurrence, before heading to the Governor’s desk for his decision, and he is expected to sign it into law.,

Earlier this year, Senator Bates co-authored Senate Bill 238  with Sen. Shannon Grove (R-Bakersfield), that would have conformed California’s test for determining employment status for purposes of wage orders to the test established by the federal Fair Labor Standards Act. The Senate Labor, Public Employment and Retirement Committee killed SB 238 on a partisan vote on April 24, 2019.

AB 5 will be heard in the Assembly next.

Our #AB5 to stop the misclassification of nearly a million misclassified California workers so they are provided a minimum wage, benefits and workplace rights has passed the Senate today with 29 votes. It now heads to the Assembly.

— Lorena Gonzalez (@LorenaAD80) September 11, 2019