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California Gig Economy Bill (AB5) and Music


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Assembly Bill 5, which has just become law in California, will mandate that most people working as "independent contractors" be reclassified as employees, with all the benefits and protections that entails. It was largely inspired by the plight of Uber and Lyft drivers, for whom I agree something needed to happen. But we're all reading a lot of panicky (perhaps rightfully) coverage of AB5 regarding the music and film/TV industries. Such as this article in Variety.

 

I haven't done a thorough study of the bill's language, but one-size-fits-all wording with unintended consequences is unsurprising, especially in CA. If you're a California creative or user of creatives' services, how will this bill impact your business? Are there upsides? Workarounds? Is there really no parameter regarding duration of employment (e.g. it seems straightforward enough that musicians hired for the time it takes to record an album, even as they're working on other things too, should be contractors)? Can freelancers get around this by registering as a business entity (sole proprietorship, S-corp, etc.) and hanging out a shingle?

 

I do know that a lot of conscientious people were working on language for an exemption, which was then rejected by the American Federation of Musicians.

 

Having taken a swing at this hornets' nest, I will now duck.

Stephen Fortner

Principal, Fortner Media

Former Editor in Chief, Keyboard Magazine

Digital Piano Consultant, Piano Buyer Magazine

 

Industry affiliations: Antares, Arturia, Giles Communications, MS Media, Polyverse

 

 

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Geez, what will they think of next? I suppose independent lawyers fighting this law (or its interpretation) will be making out well.

 

Honestly, I don't see how it could logically be applied to musicians, or any other artist or craftsperson. Does someone in the band have to become the employer of the other band members? Or if a band or soloist plays bars, music clubs, and house concerts, does each venue have to provide him with health insurance and a minimum wage? Every bar he plays in? The singer who plays a restaurant every Monday, and a different one every Tuesday, and is a member of a band that plays dances at the American Legion Hall on Saturday night - - which one is his "employer?"

 

The bill sort of makes sense for organizations like Uber, where all of the "not employees" do the same thing for the same company. But what about the one who drives for both Uber and Lyft? And Uber trying to get out from under it because they say that providing rides isn't their primary business, they're "a technology company." I think it would make good sense for Uber to offer drivers a health insurance plan (which is not the same as giving them free health insurance) on an opt-in basis. But there needs to be room for an independent worker to be independent, as long the worker understands what "independent" means. And that's the problem that, I presume, prompted the bill to be written.

 

 

 

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And here in Baltimore, they just proposed a bill requiring an extra license (i.e. FEE) for ANY outdoor event having live music OR playing recorded music. It's for "health, safety and general welfare" purposes. No, it's another governmental money grab.

"Am I enough of a freak to be worth paying to see?"- Separated Out (Marillion)

NEW band Old band

 

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I'm not into political forum topics in general, but am very much in favor of topics if they involve musicians or artists and touch on politics.

 

I'm an independent contractor for, I dunno, probably a couple dozen businesses overall. One year I might get nothing from one company, next year it might be a lot. So who's going to be my "employer"?

 

Here's a possible solution that's shooting from the hip, so it probably sucks: Anyone who pays someone for their services pays 2% into a health insurance pool. It's another accounting burden, like filing 1099s, but would work like social security - if you had that 2% taken from what you got paid, you would get health care expenses defrayed commensurate with what you paid in over the years.

 

The main reason I see for people wanting to be employees is health insurance, automatic tax deductions so you can't fall behind, and (possibly) a 401k. Take care of the health insurance issue, then let people be responsible for paying their taxes and investing for their future.

 

It used to be that being an employee meant at least some kind of job security. But I have a lot more security being self-employed than depending on a company to have its act together. How many people did Uber lay off recently? Hmmm...

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Folk, blues, and bluegrass musicians have a union - AFM Local 1000. It has a lot to offer to the "gigging" musician, once he or she has reached a reasonable income level and fairly steady working schedule. There could certainly be something like that for Uber drivers, and maybe even drummers.

 

As far as tax withholding goes, I pay quarterly estimated income tax to the IRS and state. There could be a better system for that, I guess, since it took me about 10 years to come up with a spreadsheet that didn't either get me a $10,000 tax refund or have to pay enough so that an "underpayment" penalty was added a couple of years. It's pretty stable now.

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Folk, blues, and bluegrass musicians have a union - AFM Local 1000. It has a lot to offer to the "gigging" musician, once he or she has reached a reasonable income level and fairly steady working schedule. There could certainly be something like that for Uber drivers, and maybe even drummers.

 

I was a member of local 802 in New York during my studio days. What they did in terms of benefits was...uh...take union dues from my check. They weren't set up for the music scene of the 60s.

 

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The "Local" part of AFM Local 1000 is a bit of a misnomer. It covers USA and Canada.

 

I realize that there are some employers who make all the benefits appear free to the employee. I worked for the US Gov't, and it doesn't quite work that way, or, maybe, it's that it's more transparent. They take a portion of my salary and put it toward retirement, and they put in an amount as well. Same with health insurance. I pay part, they pay part. In retirement, they still send part of my pension to the IRS (and report it as income), and they let me continue with health insurance with my share deducted from my monthly pension payout.

 

You can consider union dues to be the same sort of arrangement - you're contributing to your future needs. Of course the union has to be well managed so they get a better deal with insurance than an individual can, and they don't waste your money. Unions get a bad rap because of some large ones that have been managed badly.

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I was a member of local 802 in New York during my studio days. What they did in terms of benefits was...uh...take union dues from my check. They weren't set up for the music scene of the 60s.

 

Local 47 dues (Hollywood) got you free use of the pool tables. But that was about it.

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