May 29, 2019
By: Thomas M. O’Connell
Executive Summary
The California Assembly passed AB5. The bill now moves to the Senate for consideration.
Analysis
On May 29, 2019, the California Assembly passed AB5 as amended on May 24, 2019. Votes for AB5 broke down along partisan lines with 59 ayes, 15 noes, and 6 no votes recorded.The bill will now move to the California Senate for consideration, starting with the Labor, Public Employment and Retirement Committee.
Looking Forward
AB5 has been making its way through the Assembly pushed by Democratic Assemblypersons and the special interests who claim that the bill will be good for the average worker. Whether you agree with the Dynamex “ABC” Test or not, it is unfortunate that the Assembly has missed the opportunity to provide clarity to the most important small business model in our State: franchising. While there is some hope that amendments will at least clarify issues for certain franchise industries, the franchise model has become such a popular target among certain special interests–particularly labor unions–that an overarching amendment remains virtually impossible. Without a significant change in the pace of this bill, it is likely AB5 will become law by the first of 2020.
This article was originally published on the California Franchise Network.