By: Lauren Hobler-Tregerman
Imagine Sandra, a recent graduate from a prestigious conservatory in the northeast who heads to Los Angeles after graduation in hopes of being a film composer. She is an independent musician with no record label, no union, and no musical executives backing her up or guiding her in her employment decisions. She juggles multiple jobs and has no health benefits, retirement plan, or sick leave. Nor is there a wage standard by which her commission work is bound to. She works independently for many individuals and organizations who hire her to transcribe, compose, or even perform. And at any moment, they can hire someone else no matter how dedicated and continuous her work is, and Sandra is left to struggle to find another commission without unemployment benefits.
This is precisely a situation which California’s new legislation, AB5, responds to. Under AB5, hundreds and thousands of freelancers and “gig economy” workers gain new rights as “employees” who have been wrongly classified as “independent contractors.” This has a profound impact in nearly every industry including the music industry in which independent and freelance work is prevalent. AB5 is the legislative outcome of the 2018 California Supreme Court class-action lawsuit case, Dynamex Operations W. v. Superior Court, which determined that Dynamex’s delivery drivers were wrongly classified as independent contractors, and thus, Dynamex was not fulfilling its obligations under California’s wage orders. The California Supreme Court’s stated objective in this ruling was to ensure a worker’s bargaining power and most fundamentally to “protect the health and welfare” of workers. The court applied a three-part test to determine employment status by establishing that a worker can be considered an “independent contractor” only if the hiring entity shows that: A) the worker is “free from the control and direction” of the hiring entity in relation to the worker’s performance; B) the worker is performing work which is “outside the usual course of the hiring entity’s business”; and C) the worker is typically working in an independent business of “the same nature as the work performed for the hiring entity.”
The AB5 legislation adopted all of these criteria in determining employment status. Several music industry executives have outwardly expressed concern for the new legislation, addressing the fact it would “gut the music industry.” These fears were expressed in an Op-Ed article authored by prominent music executives who argue that the legislation could have extremely negative consequences for the independent artist in being wrongly categorized as an “employer” due to the large variety of other, independent artists who they commission at various stages of their work, such as sound engineers, producers, background instrumentalists, and more. However, while these concerns are valid, they seem to purposefully focus on the potential liability of an independent musician, who is likely not incorporated as a business, if categorized as an “employer” rather than seriously construing the liability that could face the record labels and high-profile music companies as “employers” and corporations who are currently facing economic hardships with the technological revolution of the music industry. Although, on their face, these concerns seem protective of the independent artist, in reality they may very well be counter-productive to ensuring freelance musicians basic wage protections and bargaining power. The music industry, in fact, had the opportunity to work out an exemption within the legislation to consider these issues, however the industry could not reach consensus over exemption language and thus no amendment was made.
It is unclear, therefore, whether the industry is afraid of this change due to their own economic hardships, or whether they are genuinely working towards protecting independent artists and seeing the promise that AB5 has for protecting the abundance of freelancing musicians in California’s evolving music scene.
 John Myers, Johana Bhuiyan & Margot Roosevelt, Newsom signs bill rewriting California employment law, limiting use of independent contractors, Los Angeles Times (Sept. 18, 2019, 3:55 PM), https://www.latimes.com/california/story/2019-09-18/gavin-newsom-signs-ab5-employees0independent-contractors-california.
 See Id.
 Dynamex Operations W. v. Superior Court, 4 Cal.5th 903, 942 (2018).
 Id. at 952.
 Id. at 916-917.
 Id. at 917.
 See Myers, Bhuiyan & Roosevelt, supra note 1.
 See Mitch Glazier, Richard James Burgess, Susan Genco & Jordan Bromley, AB5 Could Crush Independent Music in California, Variety (Sept. 4, 2019, 5:55 AM), https://variety.com/2019/music/news/ab5-could-crush-independent-music-in-california-guest-column-1203322730/ (explaining the extent to which independent artists “hire” other individuals to help “realize their vision” but not explaining the lack of protections that hired, independent artists face in a variety of freelancing hypotheticals).
 The music industry is currently facing a tech revolution which disrupts the prior business hierarchy with record companies and labels on the top. This is evident by the dramatic decrease in profits from recorded music. Musicians must therefore shift their focus as professionals to new forms of musical commission work proliferated through new technology including in digital advertising, digital fan-based interaction, social media, and film or television. See Henry H. Perritt, Jr., New Business Models for Music, 18 Vill. Sports & Ent. L.J. 63, 65-66 (2011).
 Claudia Rosenbaum, California Bill Could ‘Gut the Music Industry,’ But Lawmaker Says Trade Groups Couldn’t Agree on Exemption, Billboard (Sept. 9, 2019), https://www.billboard.com/articles/business/legal-and-management/8529517/california-bill-music-industry-exemption.
 See supra note 9 at 70-71, for an overview of the “characteristics of the music industry” which determine the musician’s response to the marketplace and economic resources available for creativity.