On September 30, 2021, California updated its exceptions to the law that regulates independent contractor classification (AB 5). AB 5 requires a three-part test, also known as the ABC test, to determine whether workers are employees or independent contractors.
When an exception to the ABC test applies, employers need to revert to previous multifactor determination worker classification methods. Updates to the exceptions become effective on January 1, 2022.
Employers should become familiar with the ABC test, its exemptions and the updates that become effective in 2022.
January 1, 2020 – effective date for AB 5 (and the ABC test) across the state of California.
September 4, 2020 – California expanded the list of occupations exempt from AB 5.
September 30, 2021 – California amends some exemptions to AB 5. The updates become effective January 1, 2022.
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