State Senator Moorlach gets to say "I told you so!" over California's attempted end-run around recent changes to federal tax law.

Sen. Moorlach bill SB 990 would suspend AB 5

Senator John M. W. Moorlach (R-Costa Mesa) announced today that he has amended SB 990 to suspend AB 5 — the law enacted last year that prohibits many Californians from doing business as independent contractors.

“Californians should be free from the chains of this AB 5 nonsense,” Moorlach said.

Senate Bill 990 — the AB 5 Emergency Suspension Act — will allow tens of thousands of Californians to earn a living as independent contractors during this time of economic crisis caused by the global COVID-19 pandemic.

AB 5 converted numerous consulting, and related professions, from independent contractor status to common law employee status, thus causing many businesses who retain certain individuals, whose skill sets were not specifically carved out in AB 5, to lose their business relationships.

“Carving out certain industries shows a favoritism that should not be mandated in the state’s income tax code,” said Moorlach. “Therefore, AB 5 is technically flawed and must be subject to a serious pause button.”

Demand for unemployment insurance benefits in California has reached historically high levels according the state’s Employment Development Department (EDD). Millions of unemployed Californians could potentially earn more as freelancers than unemployment checks provide if SB 990 passes.

If enacted, SB 990 would immediately delay AB 5 until January 1, 2022.

AB 5 has negatively impacted thousands of jobs and industries, including:

  • ride sharing
  • food delivery
  • design services
  • single truck owner-operators
  • interpreting/translating services
  • occupational therapists
  • nonprofits
  • home repairs
  • catering event planning
  • lab technology
  • hair and nail salons
  • optometry
  • dentistry
  • social work
  • behaviorist health
  • pet grooming
  • pool cleaning
  • food/hotel franchises

“I’m going to continue to pound the table until AB 5 is suspended,” said Moorlach. “Senate Bill 990 is a critical piece of legislation that should be enacted if Governor Newsom fails to act.”

4 Comments

  1. Why should employers be allowed to shirk their responsibilities to their employees and hang their tax burden on the rest of us by calling their employees ” independent contractors ” ?
    AB5 was long overdue and if defeated in the courts a stronger bill should be passed .

    1. Mr. Pharris,

      Thank you for reading Orange County Breeze.

      The point about independent contractors is that they are not employees. For the most part, the relationship between an employer and an independent contractor was mutually agreed upon and beneficial, notwithstanding a limited number of bad apples. The independent contracting status does not hang a tax burden on the rest of us, it shifts much of the burden of the cost of such things as health benefits to the independent contractor.

      Adults can make prudential decisions regarding such trade-offs. Adults should be allowed to make such prudential decisions.

      The Dynamex decision was overly broad in the application of a new definition of who can be an independent contractor. AB 5, which turned the judicial decision into law, has sunk into the muck of jillions of exemptions with differing sunset dates. Who gets what sort of exemption depends on resourceful lobbying in Sacramento. The only winners are lobbyists (who get paid for lobbying), venal politicians (who look forward to election donations based on those sunset dates), and unions (which hope to harvest new members and their dues).

      The new definition of an independent contractor should be thrown out. AB 5 should be repealed.

      Again, thank you for reading Orange County Breeze.

      Stay safe, stay healthy!

      Shelley Henderson
      editor, Orange County Breeze

  2. Every Californian elected official in Sacramento should support State Sen. John Moorlach in his efforts to stop AB-5 with Senate Bill 990.

    AB-5 is such a government overreach on freelance/self-employed workers that it brought together Republicans and Democrats to work on its defeat. Outgoing Assemblyman Tyler Diep was the only Republican to vote for AB-5 and he was defeated in the primary.

    Especially now, with so many Californians laid off or furloughed, AB-5 must be stopped. Thank you Sen. Moorlach for leading the effort to stop the disastrous AB-5.

  3. AB5 is by far one one the worst laws ever enacted in this state. And that is saying a lot. Why on earth would the Democrats want to prevent hard working taxpaying Californians from earning a living? Makes no sense other than they are appeasing their union friends. This won’t increase union membership but it will anger a lot of people. This just shows that you can be stupid and yet still be a California legislator. Thank you Mr. Moorlach for keeping up the fight.

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