California’s statute governing the classification of independent contractors, enacted under Assembly Bill (AB) 5, underwent a significant renovation on September 4, 2020, when Governor Gavin Newsom signed AB 2257. The emergency measure, which takes effect immediately, contains several new exemptions and revises existing law related to exemptions for business-to-business relationships, referral agencies, professional services, and performance artists, among others.
In a favorable opinion for employers, the California Court of Appeal for the Second District concluded the following on December 4, 2019, in David Cacho v. Eurostar, Inc.
California employers have long grappled with two wage and hour questions:
- What rate of pay should be used to calculate meal and rest period premiums in California?
- Does the facially neutral “rounding” of employee work time, which results in a small subset of employees being undercompensated, result in systematic undercompensation on a class-wide basis?