Did you know that booth rental in California is currently illegal? Now that I have your attention, let’s get into how the State of California is poised to kill a portion of our industry, and how you can help fix it. The beauty industry needs your help to oppose AB5 in California. oppose AB5 california dynamex
The Dynamex Decision
In April of 2018, the California Supreme Court handed down a decision that determines who can be labelled an independent contractor in that state. If the worker doesn’t pass the ABC test, then the worker must be classified as an employee. The ABC test states:
(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. oppose AB5 california dynamex
Because most beauty industry members work alongside other independent providers, we don’t pass the “B” criterion laid out by this decision. That means if you currently rent space inside of a salon, you must become an employee of that salon to comply with this new law. Even if you are the only nail technician and the salon you rent from doesn’t offer nail services, what you offer is not considered “outside of the usual course of the hiring entity’s business.”
You can be an employee of the salon, or you can rent an expensive salon suite, or you can rent a space in an office complex as long as you have your own establishment license. Otherwise you are in an illegal situation and in violation of California law, effective April 2018.
Proposed California Law AB 5
In reaction to the Dynamex decision, a bill was proposed by California State Assembly Member Lorena Gonzalez (D- San Diego) that would add Section 2750.3 to the Labor Code. This act clarifies the court’s decision and exempts certain professions from having to pass the ABC test. Like the Dynamex decision, this affects many industries in California, not just beauty (ie. doctors, rideshare drivers, freelancers and those likely to be a part of the “gig economy” etc.) Some of these groups have powerful lobbies to represent them and have been able to ensure that they will be exempt from this law. As currently written, this law would exempt doctors, real estate agents, and even hairstylists from the requirement of being employed by the business where they work. Recent pressure from estheticians and electrologists will likely result in a revision to include them in the bill, leaving manicurists as the sole beauty license category to remain affected. oppose AB5 california dynamex
Apparently Assembly Member Gonzalez and other California legislators believe that nail salon owners are some of the biggest offenders when it comes to employee misclassification, contributing to human, sex, and labor trafficking. Interest groups like the California Healthy Nail Salon Collaborative perpetuate the stereotype that the overwhelming majority of manicurists in California are marginalized “immigrant women” (their term) who are being exploited and will benefit from these forced employment “protections.” oppose AB5 california dynamex
Why This is Wrong
The State of California (where I hold a valid manicurist license) knows that the independent contractor classification can be perceived as a loophole for employers to avoid paying employment taxes and offering benefits. These bad actors are present throughout the country, the state, and every industry – not just nails. These employers are either ignorant of the law, or are willfully negligent while the Department of Labor and the IRS can only catch so much.
Solving the problem of employment misclassification by forcing licensees into an employment situation is not a viable option.
EMPLOYERS CANNOT BE BOTH THE PROBLEM AND THE SOLUTION!
If the state of California is concerned with protecting workers’ rights, it must enforce the labor laws currently on the books instead of assuming the misclassification offenders will suddenly do the right thing with the addition of another law. oppose AB5 california dynamex
If a misclassified manicurist wants to leave his or her current salon, there are now fewer options to make a living. One can only move from salon to salon as a W2 employee, or work alone without the benefit of the foot traffic or safety of an existing beauty business. The barriers to entry to our business are already great. AB 5 is an unnecessary hardship that will leave manicurists footing the bill for the entire beauty industry’s bad behavior.
What YOU Can Do
Contact your local State Assembly Member and State Senator in California and ask them to create an exemption for manicurists on AB 5. You can find who that is here. Copy and paste the below opposition letter, add your name and home address, and send it to your representatives. Only if we are vocal, active, and mobilized will we be able to make our objections known and have a chance of changing this proposed law. We must act now to protect our small businesses and the right to earn a living in California. oppose AB5 california dynamex
[YOUR CONTACT INFO]
Dear [Representative Name],
I am writing today in opposition to AB 5 – worker status: employees and independent contractors.
As written, AB 5 would severely limit the ability of beauty professionals like myself to operate a small business in California. The right to earn a living with my valid California manicurist license is an issue of paramount importance, and I cannot stand by while my livelihood is threatened.
AB 5 does not allow manicurists to rent space inside of an existing salon, a practice commonly known as “booth rental.” AB 5 would either force me to seek employment where very few opportunities exist, or seek a space to rent that is often prohibitively expensive given the average price of nail services.
I urge you to ask the members of the Senate Labor, Public Employment and Retirement committee to amend the bill to exempt ALL license types regulated by the Board of Barbering and Cosmetology to ensure that licensed manicurists like me will have the freedom to do lawful business in the state of California.