U.S. Supreme Court won't hear freelancers' challenge to California employment law

The U.S. Supreme Court building is seen in Washington
The U.S. Supreme Court building is seen in Washington, U.S., June 26, 2022. REUTERS/Elizabeth Frantz
  • Freelancer groups claimed law violates free-speech rights
  • Court could still address law's application to truck drivers

(Reuters) - The U.S. Supreme Court on Monday turned away a challenge by groups representing freelance workers to California's controversial law making it more difficult for businesses to treat workers as independent contractors rather than employees.

The court denied a petition by the American Society for Journalists and Authors and the National Press Photographers Association, which claim the 2019 law known as AB5 violates freelance journalists' free-speech rights by exempting other workers but not them.

The 9th U.S. Circuit Court of Appeals in October said AB5 regulates economic activity and not speech, and that it made sense for the law to carve out certain industries in which worker misclassification has been less of a problem.

The California Attorney General's office did not immediately respond to a request for comment.

Jim Manley of the Pacific Legal Foundation, who represents the freelancer groups, said in an email that the court's decision "is a loss for the thousands of freelancers who have built thriving careers through the freedom and flexibility that independent contracting provides."

AB5 says workers are a company's employees if they are under its direct control, engaged in its usual course of business, or do not operate their own independent businesses.

The issue is crucial for businesses because employees are entitled to the minimum wage, overtime and other benefits, making them much more expensive than independent contractors.

Trade groups and "gig economy" companies lobbied heavily against AB5, claiming it would deprive many workers of flexibility and the opportunity to work multiple jobs.

In 2020, California voters approved a ballot referendum exempting app-based transportation services such as Uber Technologies Inc and Lyft Inc from the scope of AB5. A state judge last year struck down the measure, saying it violated the state's workers' compensation law. An industry group's appeal is pending.

The ASJA in its 2019 lawsuit claimed AB5 unreasonably blocks many freelance writers from being treated as independent contractors based on the content of their speech, while exempting similar work performed for marketing or artistic purposes.

A federal judge in 2020 sided with the state, saying the categories of workers outlined in the law plainly do not turn on the substance of a worker's speech, and the 9th Circuit last year agreed.

The Supreme Court has yet to act on a petition by the California Trucking Association in a lawsuit challenging AB5's application to the trucking industry. The justices in October declined to take up a separate case involving the classification of truck drivers.

The case is American Society of Journalists and Authors v. Bonta, U.S. Supreme Court, No. 21-1172.

For the ASJA: Jim Manley of Pacific Legal Foundation

For California: Deputy Solicitor General Samuel Siegel of the California Department of Justice

(NOTE: This article has been updated to include a comment from Jim Manley of the Pacific Legal Foundation.)

Read more:

9th Circ. rejects freelancer groups' challenge to California's AB5

No SCOTUS review of California law's impact on trucking industry

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Dan Wiessner (@danwiessner) reports on labor and employment and immigration law, including litigation and policy making. He can be reached at daniel.wiessner@thomsonreuters.com.