FSC Issues “Simplified Guide” to AB5

LOS ANGELES – The Free Speech Coalition (FSC) has published what the group called a “simplified guide” to AB5, the new California law that “could require businesses in the state to classify performers, cam models, and other adult workers as employees, rather than independent contractors.”

The summary briefly describes the law, offers a link to the full text of the statute and an FAQ prepared by the California Labor & Workforce Development Agency, describes the potential impact of the law and offers three basic approaches businesses can take in response to the law. Those three approaches are labeled “Avoid All Risk,” “Take a Calculated Risk” and “Ride the Risk.”

“AB 5 affects every industry, not just the adult industry,” said Michelle L. LeBlanc, Executive Director of FSC. “There is widespread confusion about what is actually in the law and how to comply with it. The one thing that is clear is that there is significant potential risk for any business that pays California-based workers — from studio and cam performers to production crew to office staff — as independent contractors. We’ll be doing more education about AB 5 in the new year, but with so much confusion, and the law going into effect in just a few weeks, we wanted to provide clarified guidance for our members.”

As LeBlanc and the FSC’s newly published guide both caution, because the law is new, it’s not yet clear how (or if) it will be applied to the adult entertainment industry. This ambiguity doesn’t mean there’s nothing adult businesses can do to prepare for its impact, however.

Each section of the guide dedicated to the possible approach businesses can take offers a pro/con analysis, noting some of the advantages and disadvantages of each option.

According to FSC, the new AB5 guide was produced in consultation with attorney Karen Tynan of Ogletree, Deakins, Nash, Smoak & Stewart, P.C., and Walter Wotman, CPA of Morgan, Daggett & Wotman, LLP.

Read the full guide to AB5 on the FSC website.