California’s AB5 & the Impact on Music

California's AB5 Amended to Protect Music Makers

 

The Recording Academy, its members, and other music industry stakeholders, successfully lobbied California’s Government to amend Assembly Bill 5 (AB5) to exempt many musicians, songwriters, studio professionals and other individuals working in the music industry from the bill’s unintended consequences.  Learn how.

What is AB5?

Following the California State Supreme Court Decision in Dynamex, the California legislature passed Assembly Bill 5 (AB5) in September 2019, with the intention to regulate gig-economy workers like Uber, Lyft, and Doordash drivers, along with other independent contractors doing business in the state. AB5 changes classification requirements for independent contractors, enabling many former contractors to have access to labor protections, such as sick leave and workers’ compensation. The bill was signed into law by Governor Gavin Newsom, and took effect on January 1, 2020.

As originally enacted, AB5 would have added untold costs for compliance, accounting practices, and new business expenses such as payroll processing to a musicians’ overhead— Recording Academy members of the Los Angeles and San Francisco Chapters had already experienced difficulties with the law, prompting the need to secure an exemption to protect many music makers in the state.

Securing an Exemption: Recording Academy and Others Lead Effort to Protect Music Makers

The music industry-led amendment to California’s Assembly Bill 5 (AB5) was signed into law by Governor Gavin Newsom on September 4 after unanimously passing the state House and Senate on September 1. The amendment, negotiated by the Recording Academy in coordination with other music industry stakeholders, California Assemblywoman Lorena Gonzalez and Majority Leader Ian Calderon, was first agreed to in April, and will exempt most music industry workers from the requirements of AB5 as it pertains to determining employment classification for both live performances and studio recordings. The exemption, which now goes into effect, will ensure that all music makers will be able to continue to operate under the pre-existing workforce requirements.  

The Recording Academy worked to draft the amendment, negotiating alongside music industry stakeholders, lawmakers, and proponents of AB5. The Academy also hosted a panel discussion during GRAMMY weekend in Los Angeles with leading activists from the music and law communities to discuss the impacts and costs AB5 could have on California’s music ecosystem. Similarly, the Los Angeles and San Francisco Chapters of the Recording Academy were in constant communication with their members regarding the latest updates and advocacy opportunities.

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