Music industry, lawmakers, unions agree on revamp to AB5

California’s music industry has reached a hard-fought agreement with state lawmakers and unions on Assembly Bill 5 amendments that will again allow most professionals to operate as independent contractors.

Assemblywoman Lorena Gonzalez, D-San Diego, authored AB5 with the backing of union interests. The bill was designed to protect workers’ rights by changing their status from independent contractors to employees, which affords them benefits and protections they otherwise wouldn’t have.

But the law had the reverse effect on a variety of self-employed workers, and none have been more adversely impacted than musicians.

Before AB5, musicians, singers and songwriters who performed at a club were considered self-employed. But the legislation reclassified them as direct employees of the venue. So instead of simply writing a check to pay artists, club owners have been forced to issue a W2 form to each player, while also providing a variety of protections, ranging from unemployment insurance and Social Security benefits to disability insurance and workers’ compensation coverage.

An artist who hired backup musicians would likewise be considered an employer of those players and would have to provide them with the same benefits and protections.

Many club owners didn’t want to shoulder the additional expense and red tape, so they stopped providing live entertainment, putting scores of musicians out of work. The bill has created similar ripples for scores of others in the industry.

The pending amendments to AB5, announced by Gonzalez alongside Assembly Majority Leader Ian Calderon, D-Whittier, will be considered by the state Legislature when it reconvenes.

“We all hope for an urgency measure,” said singer/songwriter Ari Herstand, who helped found California Independent Music Professionals United to exempt musicians from the constraints of AB5. “That only happens if you get a two-thirds vote from both the Assembly and Senate. But if you do get that, it goes into effect immediately.”

Mitch Glazier, chairman, and CEO of the Recording Industry Association of America, applauded the revamp.

The amendments appropriately narrow the effect of AB5 to clarify that music professionals, due to the unique nature of our business, cannot be treated as an employer every time they collaborate,” he said.

The new language has been agreed upon by the Recording Industry Association of America, American Association of Independent Music, American Federation of Musicians, Screen Actors Guild and Teamsters, among others.

Sleepless nights

“I had lots of sleepless nights to get musicians relief under AB5, but I’m happy we were able to come to an agreement,” Herstand said. “We didn’t get 100% of what we wanted. We weren’t able to exempt small orchestras and small community theater productions … they wouldn’t budge on that.”

The language also specifically provides for unions to continue to organize the work of recording artists, musicians, singers and others, ensuring that current and future collective bargaining agreements will always govern in California.

Virtual festival

Herstand hopes to see the music industry begin to rebound in late summer or early fall, depending on how quickly the COVID-19 pandemic is reined in. But he’s not waiting around.

“I launched a virtual UnCancelled Music Festival that is live-streamed around the world to support artists and music venues,” he said. “In the first week and a half we raised almost $100,000. We feature 10 to 12 artists a day.”

The money was generated through online ticket sales and tips for the artists.

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