On Sept. 18, California Gov. Gavin Newsom signed Assembly Bill 5 (AB5) into law. AB5, effective Jan. 1, 2020, seeks to codify and clarify a California Supreme Court case (Dynamex Operations West, Inc. v. Superior Court of Los Angeles), which dramatically changed the standard for determining whether workers in California should be classified as employees or as independent contractors. Specifically, the Dynamex court held there is a presumption that workers are employees, and placed the burden on an entity classifying an individual as an independent contractor to prove that such a classification is proper under a three-part “ABC” test.

Although much of the public debate surrounding AB5 has centered around the “gig economy” (such as ridesharing companies), whether AB5 impacts more traditional business relationships, such as franchisee-franchisor relationships, remains up for debate.

Click here to read the full GT Alert, “AB5 Update: California Legislature Seeks Shake-Up of Gig Economy; Any Impact of CA Independent Contractor Laws on Franchisors Remains Unclear.”

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Photo of Michael Wertheim Michael Wertheim

Michael Wertheim represents employers in workplace matters, including employment litigation, wage and hour class actions, California Labor Code actions, Private Attorneys General Act actions, and traditional labor law. He also represents companies in a wide range of employment disputes in both state and…

Michael Wertheim represents employers in workplace matters, including employment litigation, wage and hour class actions, California Labor Code actions, Private Attorneys General Act actions, and traditional labor law. He also represents companies in a wide range of employment disputes in both state and federal court, including cases alleging discrimination, harassment, wrongful termination, and retaliation. In addition, Michael handles labor arbitrations, unfair labor practice charges, and other labor proceedings before the National Labor Relations Board and Public Employment Relations Board.

Photo of Ashley M. Farrell Pickett Ashley M. Farrell Pickett

Ashley M. Farrell Pickett defends companies in complex employment class and representative litigation in both state and federal courts throughout the country. She has deep experience representing large and small employers alike at all stages of high stakes litigation—from pre-trial demands through trial…

Ashley M. Farrell Pickett defends companies in complex employment class and representative litigation in both state and federal courts throughout the country. She has deep experience representing large and small employers alike at all stages of high stakes litigation—from pre-trial demands through trial or arbitration, settlement, and on appeal.

Ashley has litigated a wide range of employment claims facing companies, including wage and hour compliance, discrimination, retaliation, sexual harassment, leaves of absence, employee accommodations, personnel policies, and employment agreements. She is also skilled in advising employers on various issues to ensure compliance and avoid potentially costly litigation before it can arise.

Photo of David W. Oppenheim David W. Oppenheim

David W. Oppenheim concentrates his practice on domestic and international franchising, licensing, and distribution matters. He is recognized by Chambers USA as a leading, national franchise attorney. He advises both emerging and mature companies with respect to planning, structuring, and implementing national and…

David W. Oppenheim concentrates his practice on domestic and international franchising, licensing, and distribution matters. He is recognized by Chambers USA as a leading, national franchise attorney. He advises both emerging and mature companies with respect to planning, structuring, and implementing national and international franchise, distribution, and licensing programs, including negotiating franchise agreements, ancillary agreements, regulatory compliance, including the preparation of franchise disclosure documents, and securing registration of franchise offerings in the United States and abroad.

David is also experienced in mergers and acquisitions and sophisticated financing transactions, including the securitizations of a franchisor’s royalty stream. He represents private equity firms and public and private companies in the acquisition of franchise, licensing, and distribution systems. David routinely counsels clients regarding the implementation of compliance programs and system-wide standards. He also advises franchise clients regarding complex franchise relationship issues and disputes.

Photo of Mark Kemple Mark Kemple

Mark D. Kemple is Co-Chair of the firm’s Labor & Employment Class and Collective Action practice and leads the Southern California Labor & Employment Practice. He has broad trial experience in many areas of the law, including employment class and individual litigation, consumer…

Mark D. Kemple is Co-Chair of the firm’s Labor & Employment Class and Collective Action practice and leads the Southern California Labor & Employment Practice. He has broad trial experience in many areas of the law, including employment class and individual litigation, consumer class litigation, false advertising, and unfair competition, where he focuses on the defense of wage/hour class actions and individual employment claims. Mark has handled disputes for companies of all sizes, and has tried numerous lawsuits and arbitrations throughout the United States. He has argued appeals in three federal circuits and several state courts of appeal, including in the California Supreme Court.