There have been several new regulations for U.S. contractors in the past couple of years, including New York State’s “Freelance Isn’t Free Act,” established in 2017 to enhance protections for freelance workers. And in the landmark 2018 Dynamex Operations v. Superior Court of Los Angeles, the California Supreme Court made it more difficult to designate workers as independent contractors in that state.
For companies, rulings such as Dynamex have made the hiring process for independent and third-party planners more challenging. Under the newly adopted “ABC test,” according to Forbes, a worker is an independent contractor in California, only if the hiring entity establishes all of the following:
A) that the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact;
B) that the worker performs work that is outside the usual course of the hiring entity’s business; and
C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.