Dear Mr. Shapiro,
This message is in response to the piece you wrote and published in your news outlet the Milpitas Beat–“Open letter to California State Assemblywoman Lorena Gonzalez: Repeal AB5 right this second.”
All Californians are trying to recover from an ongoing, unprecedented public health crisis that shutdown our economy. For most working Californians, what provided a safety net during these unimaginably difficult times were the job protections and benefits that are guaranteed by employment status. Sick leave, Family leave, state disability insurance and unemployment insurance—all of these programs are made possible by the contributions employers and employees make through their payroll.
When employers misclassify their workers as independent contractors, it’s taxpayers who are left holding the bag when those workers get injured on the job or are without work. California was the first state this year forced to borrow money from the federal government to continue to pay for UI payments through this crisis. That means, when that loan becomes due, law-abiding businesses will have to pay even more per employee in order to stabilize the fund again. Meanwhile, misclassifying “gig companies” continue to flout the law and refuse to contribute to the UI fund on behalf of their workers. Law abiding small businesses will be forced to pick up their tab if we let these billion- dollar corporations off the hook.
However, as you rightfully admit in your piece, misclassification is a “routine” issue. It is so routine, in fact, after decades of dealing with misclassification cases, the California Supreme Court in 2018 said enough was enough. The Court acted in a bipartisan and unanimous case known as Dynamex to create an employment standard known as the ABC test. Assembly Bill 5 is the codification of this decision.
In your open letter, you make the claim that this law “was devised to crack down on the supposed misclassification of drivers for companies like Lyft, Uber, and DoorDash”. The decision and AB 5 was intended to address misclassification that has plagued our economy for decades. There is nothing “supposed” about whether these companies are misclassifying their drivers. By all measures, drivers are central to these corporations’ core business models and are therefore their employees. AB 5 was never devised only in response to gig companies’ practice of widespread misclassification. AB 5 is a direct response to the Dynamex decision, which broadly affected all industries operating in California.
AB 5 narrowed the Dynamex decision’s impact; it did not broaden the decision. The law created more clarity for the business community, and we will continue to ensure it works for all responsible employers. What we will not stand for are industries with a history of misclassification to continue putting law-abiding businesses at a competitive disadvantage and writing themselves out of the rules.
Thank you for allowing me the opportunity to respond,
(Assemblywoman Lorena Gonzalez)