MMC HR & Payroll holds training seminars on industry professionals in how California reclassifies Independent Contractors as Employees

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What to know and how to prepare in California if you’re working with contractors.

Back in 2019, California legislature passed significant laws taking effect January 1st, 2020, that will affect California employers and their status as Independent Contractors (hereby referred to as IC). This bill will affect many of California’s workforce as the current percentage of Independent Contractors is 8.5%, which is higher than the 6.3% of estimated IC’s in the United States. According to a data brief released by the Center for Labor Research and Education at the University of California, Berkeley, nearly 2 out of 3 California workers whose primary job is as an IC will have their employment status restored under state law AB-5.

The bill itself is under scrutiny by many big businesses, such as Uber, which rely heavily on IC workers. In order for businesses to ensure proper protection and enforcement of the new law, it’s important for them to clearly recognize the strict standards of IC status. These 3 conditions are:

The worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under contract and performance of the work, and;
The worker performs work outside the usual course of the hiring entity’s customary business; and
The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work they are performing for the hiring entity.

An ABC test, an adopted test by the Supreme Court in the case of Dynamex Operations v. Superior Court, considers all workers to be employees and forces a hiring employer to bear the burden of proving otherwise. With this new legislation, MMC will be providing training seminars to inform new and existing clients how the law will affect their business. From its humble beginnings as a small business HR outsourcing company, MMC’s speciality and experience in providing top-notch human resources services means that all of their clients will be properly protected. MMC encourages all business owners to pay close attention to new laws, especially when it comes to protecting your business and employees.

MMC HR is a professional Human Resource agency that has been a top outsourcing HR company in Los Angeles for nearly 40 years. As a top HR Outsourcing service provider for over 15,000 employees nationwide, MMC has learned that there is no cutter-cutter approach when it comes to resolving workplace HR needs. Providing HR services such as payroll, bonus paycheck calculators, time and labor management, benefits, and more, MMC takes a special interest in assuring each client’s success while providing a hands-on approach to ensure exponential growth within your company.

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Nidia Verdugo
MMC
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Pouya Rahmani
MMC HR
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