Governor Signs Bill that Builds on Landmark Labor Law

SACRAMENTO – Governor Gavin Newsom signed, to be effective immediately, Assembly Bill 2257 authored by California State Assemblywoman Lorena Gonzalez (D-San Diego) to build on historic labor protections signed into law last year and clarify employment rules in the state.

“AB 2257 represents a comprehensive framework for employment law that makes a clear distinction between employer-employee relationships and professionals that run their own independent businesses,” Assemblywoman Gonzalez said. “This legislation was a product of robust dialogue over the last year with workers and businesses from every part of the state, and reflects the main principles found in the Dynamex decision and long-standing precedent developed in case law over the past 30 years.”

Last year, following a unanimous, bi-partisan California Supreme Court decision known as Dynamex, Gonzalez authored the landmark workplace rights legislation Assembly Bill 5 that codified the decision, creating a consistent definition of employment across the state’s labor laws and defining the decision’s application for a variety of industries and business relationships. Throughout the legislative process last year, Assemblywoman Gonzalez was clear that the application of a new employment test would require additional deliberation to work through the outstanding issues that remained following the court’s decision.

“Workers shouldn’t have to be tied up in litigation for years on end before they can access their basic labor rights,” Assemblywoman Gonzalez said. “AB 2257 strikes a balance and continues to provide protections for workers against misclassification that had previously gone unchecked for decades under the old rules.”

Effective immediately, AB 2257 significantly expands the types of business contracting relationships that would instead be governed by the previous Borello standard, creating multiple, reasonable pathways for businesses to comply with the law. At the same time, the legislation ensures workers who are subject to undue control and direction from their employer—or for any other reason, could not satisfy the previous Borello standard and would have been considered employees before Dynamex—are covered by the court’s ABC test.

Assemblywoman Gonzalez based this legislation on the reasoning in the Dynamex decision, previous case law, and existing provisions of the workers’ compensation and unemployment insurance laws developed over the last 30 years.

For the specific details of each section of AB 2257, please see this online fact sheet.

Assemblywoman Lorena Gonzalez represents California’s 80th Assembly District, located in southern San Diego County, including the cities of San Diego, Chula Vista, and National City. She serves as Chair of the Assembly Committee on Appropriations, Chair of the Assembly Select Committee on Women in the Workplace, and Chair of the California Latino Legislative Caucus. For more information on Assemblywoman Lorena Gonzalez visit https://a80.asmdc.org/