BILL NUMBER: AB 1727 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MARCH 18, 2016
INTRODUCED BY Assembly Member Gonzalez
( Coauthor: Senator Allen
)
JANUARY 28, 2016
An act to amend Section 2750.5 of the Labor Code,
relating to employment. An act to add Chapter 4.8
(commencing with Section 1080) to Part 3 of Division 2 of the Labor
Code, relating to employment.
LEGISLATIVE COUNSEL'S DIGEST
AB 1727, as amended, Gonzalez. Employment relations.
Hosting platforms: independent contractors.
Existing law relating to employment governs the grant of
restraining orders or injunctive relief in labor disputes, as
defined.
This bill would establish for eligible groups of independent
contractors the right to organize and negotiate with hosting
platforms, and would declare the activity of such a group to be a
labor dispute for purposes of injunctive relief. The bill would
require a hosting platform to meet and negotiate with a group on
specified subjects. The bill would define terms for those purposes.
The bill would require that, at the request of the group, a
written contract for independent contractor services, entered into on
or after the date of the conclusion of negotiations conducted in
accordance with the bill, by the hosting platform and a member of
that group, incorporate any agreement reached in those negotiations.
The bill would require the State Mediation and Conciliation
Service to facilitate negotiations, provide mediation services, and
investigate any complaint by a group claiming a violation of the
negotiation requirement. The bill would require the service, if it
finds that there is probable cause to believe a violation has
occurred, to bring an action in a specified superior court for
injunctive and other appropriate equitable relief to remedy the
violation.
The bill would prohibit a person from penalizing or retaliating
against an independent contractor for taking specified actions within
the scope of the bill.
The bill would authorize an independent contractor or a
representative of independent contractors claiming a violation under
this bill to bring an action in superior court for prescribed
remedies, and would provide for treble damages with regard to lost
income for a willful violation.
The bill would make its provisions severable.
Existing law provides a rebuttable presumption affecting the
burden of proof that a worker performing services for which a license
is required under the Contractors' State License Law, or performing
services for a person who is required to obtain that license, is an
employee, rather than an independent contractor, and specifies
factors to establish proof of independent contractor status.
This bill would make nonsubstantive changes to these provisions.
Vote: majority. Appropriation: no. Fiscal committee: no
yes . State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Chapter 4.8 (commencing with Section
1080) is added to Part 3 of Division 2 of the Labor Code
, to read:
CHAPTER 4.8. HOSTING PLATFORMS
1080. As used in this chapter:
(a) "Group activity" means to self-organize, to negotiate as a
group with one or more hosting platforms, or to engage together in
other activities for the purpose of group negotiations or other
mutual aid or protection, which activity includes, but is not
limited, to the following:
(1) Communicating with each other and with hosting platforms,
customers, and the public through any medium, including, but not
limited to, social media and other electronic modes of communication.
(2) Withholding or restricting the amount of work done through a
hosting platform at any time and for any duration. This paragraph
does not apply to an independent contractor who performs "supportive
services," as defined in Section 12300.1 of the Welfare and
Institutions Code.
(3) Boycotting or critiquing a hosting platform's business
practices.
(4) Reporting to law enforcement authorities or making public
practices of a hosting platform which an independent contractor
reasonably believes violate local, state, or federal law and
adversely affect either workers or clients, or both.
(b) "Hosting platform" is a facility for connecting people or
entities seeking to hire people for work with people seeking to
perform that work, using any medium of facilitation, including, but
not limited to, a dispatch service, an Internet Web site, or other
Internet-based site. "Hosting platform" does not include a service
provider if that entity provides only listings of goods or services
that are contracted directly between buyers and sellers without the
involvement of the provider and receives no income related to the
price of the transaction.
1081. (a) An independent contractor who is not treated by a
hosting platform as an employee and who does not employ his or her
own employees shall have the right to engage in group activity with
respect to one or more hosting platforms.
(b) Work by an independent contractor, including the use of
equipment or goods supplied as part of the work performed by the
independent contractor, is labor within the meaning of Section 16703
of the Business and Professions Code and group activity by
independent contractors shall not be subject to any statutory or
common law prohibition or limitation on combinations in restraint of
trade, including, but not limited to, Chapter 2 (commencing with
Section 16700) of Part 2 of Division 7 of the Business and
Professions Code.
(c) Group activity is a "labor dispute" within the meaning of
Section 527.3 of the Code of Civil Procedure and Section 1138.1,
provided that a court may issue injunctive relief to remedy
violations of this chapter pursuant to Sections ____ and ____.
(d) (1) A hosting platform shall meet at reasonable times and
negotiate in good faith about allowed subjects for negotiation with
any group of independent contractors constituting at least 10 of the
independent contractors using the platform on an average of at least
once per week. As used in this paragraph, "allowed subjects for
negotiation" are pricing, division of revenue, priority for
assignments or listings, advertising by independent contractors on
the hosting platform, insurance, acceptance and termination of
independent contractor participation on the hosting platform,
acceptance or refusal of services by independent contractors or
customers, and responsibility for nonpayment by customers.
(2) An individual or organization that represents independent
contractors in negotiations with a hosting platform regarding the
allowed subjects of negotiation pursuant to this section shall not be
funded directly or indirectly by a hosting platform.
(3) Participation in the group shall be evidenced by an electronic
communication from an independent contractor using the same address
the independent contractor uses to communicate with the hosting
platform, or a physical document signed by the independent
contractor, sent to either the hosting platform or to one or more
other members of the group accepting participation in the group and
agreeing to be bound contractually by the outcome of any negotiations
between the group and the hosting platform. An independent
contractor shall not be bound by the outcome of any negotiations
between a group and a hosting platform unless the independent
contractor has given that authorization.
(4) At the request of the group, a written contract for
independent contractor services, entered into on or after the date of
the conclusion of negotiations conducted in accordance with
paragraph (1), between the hosting platform and a member of that
group, shall incorporate any agreement reached in those negotiations.
(e) The State Mediation and Conciliation Service shall facilitate
the performance of the obligation of a hosting platform under
subdivision (d). The State Mediation and Conciliation Service shall
provide meeting space for negotiations unless the hosting platform
and the group make other arrangements that are mutually agreeable.
The State Mediation and Conciliation Service shall provide mediation
services at the request of either the hosting platform or the group.
The State Mediation and Conciliation Service shall investigate any
complaint by a group claiming a violation of subdivision (d), and, if
it finds that there is probable cause to believe a violation has
occurred, bring an action in the Superior Court of the State of
California for the City and County of San Francisco for injunctive
and other appropriate equitable relief to remedy the violation. The
court shall award reasonable attorney's fees and costs to the State
Mediation and Conciliation Service if it prevails in any enforcement
action.
(f) A person shall not terminate, discriminate against, or
otherwise penalize or retaliate against any independent contractor
for exercising any rights established in this chapter or for making a
complaint, participating in any enforcement proceedings under this
chapter, using any civil remedies to enforce his or her rights, or
otherwise asserting his or her rights under this chapter or
demonstrating his or her support for the policies of this chapter. A
person terminating or taking any other adverse action against any
independent contractor who has engaged in any of the foregoing
activities within one year preceding the termination or other adverse
action shall provide to the independent contractor at or before the
time of the termination or other adverse action a detailed written
statement of the reason or reasons for the termination or other
adverse action, including all the facts substantiating the reason or
reasons and all facts known to the person that contradict the
substantiating facts.
(g) An independent contractor or a representative of one or more
independent contractors claiming a violation of this chapter may
bring an action in superior court and shall be entitled to all
remedies available under the law or in equity appropriate to remedy
that violation, including, but not limited to, injunctive relief or
other equitable relief, including reinstatement to participation in a
hosting platform and compensatory damages. For a willful violation
of subdivision (d), the amount of damages attributable to lost income
due to the violation shall be trebled.
1082. The provisions of this chapter are severable. If any
provision of this chapter or its application is held invalid, that
invalidity shall not affect other provisions or applications that can
be given effect without the invalid provision or application.
SECTION 1. Section 2750.5 of the Labor Code is
amended to read:
2750.5. (a) There is a rebuttable presumption affecting the
burden of proof that an individual performing services for which a
license is required pursuant to Chapter 9 (commencing with Section
7000) of Division 3 of the Business and Professions Code, or who is
performing such services for a person who is required to obtain such
a license is an employee rather than an independent contractor. Proof
of independent contractor status includes satisfactory proof of
these factors:
(1) That the individual has the right to control, and discretion
as to the manner of, performance of the contract for services in that
the result of the work and not the means by which it is accomplished
is the primary factor bargained for.
(2) That the individual is customarily engaged in an independently
established business.
(3) That the individual's independent contractor status is bona
fide and not a subterfuge to avoid employee status. A bona fide
independent contractor status is further evidenced by the presence of
cumulative factors such as substantial investment other than
personal services in the business, holding out to be in business for
oneself, bargaining for a contract to complete a specific project for
compensation by project rather than by time, control over the time
and place the work is performed, supplying the tools or
instrumentalities used in the work other than tools and
instrumentalities normally and customarily provided by employees,
hiring employees, performing work that is not ordinarily in the
course of the principal's work, performing work that requires a
particular skill, holding a license pursuant to the Business and
Professions Code, the intent by the parties that the work
relationship is of an independent contractor status, or that the
relationship is not severable or terminable at will by the principal
but gives rise to an action for breach of contract.
(b) In addition to the factors contained in paragraphs (1), (2),
and (3) of subdivision (a), a person performing any function or
activity for which a license is required pursuant to Chapter 9
(commencing with Section 7000) of Division 3 of the Business and
Professions Code shall hold a valid contractors' license as a
condition of having independent contractor status.
(c) For purposes of workers' compensation law, this presumption is
a supplement to the existing statutory definitions of employee and
independent contractor, and is not intended to lessen the coverage of
employees under Division 4 and Division 5.