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California's Assembly Bill No 5 came into force on January 1 2020, and has had a profound effect on consultants and other independent contractors since then. It broadly affects two classes of B2B:

  1. 1099-based agreements via its ABC test
  2. C2C through its rigid 12 point requirements of Corps & LLC's doing business with each other.

Multiple entities have sued California for violation of the FIRST and FOURTEENTH amendments. Can anyone explain how these potential violations pertain to AB5?

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  • Thanks Nate - it's been a long morning - I'll correct - it's been corrected Mar 25 at 21:01
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The basic purpose of AB 5 was to codify the California courts' standard for determining whether workers who would typically be considered freelancers are employees or independent contractors.

The plaintiffs' theory is that AB 5 raises First Amendment issues because its rules for freelance journalists are different from its rules for other freelance writers, and because it . If that is the case, it could be considered a content-based restriction on speech, which is generally impermissible. (The Fourteenth Amendment is the law that makes the First Amendment applicable to the states.)

You can read the full complaint here.

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