CSEA Earns Huge Legislative Victory
The impending codification in statute of the California Supreme Court’s decision in the Dynamex case has loomed large over the entire 2019 legislative session. Many of California’s largest companies and organizations have been hoping to get an exemption under AB 5 (Gonzalez) so that their industries would not be subject to some of the strictest provisions for classifying individuals as employees.
Thanks to the diligent and dedicated work of our legislative advocate, Jennifer Tannehill, and the stellar reputation that Enrolled Agents have built within the Capitol, CSEA is happy to report that an EA exemption to Dynamex has been amended into AB 5! The language lives under the Business and Professions exemption of AB 5 and reads:
“2750.3. (a) (1) For purposes of the provisions of this code and the Unemployment Insurance Code, and for the wage orders of the Industrial Welfare Commission, a person providing labor or services for remuneration shall be considered an employee rather than an independent contractor unless the hiring entity demonstrates that all of the following conditions are satisfied:
. . .
(F) The individual customarily and regularly exercises discretion and independent judgment in the performance of the services.
(2) For purposes of this subdivision:
. . .
(B) “Professional services” means services that meet any of the following:
. . .
(vii) Services provided by an enrolled agent who is licensed by the United States Department of the Treasury to practice before the Internal Revenue Service pursuant to Part 10 of Subtitle A of Title 31 of the Code of Federal Regulations.”
. . .
To have the profession recognized by name, in statute, not only eliminates any uncertainty regarding an Enrolled Agent’s status under the law, but also serves as a testament to how highly regarded the Enrolled Agent profession is within the California legislature. There are still many, many professions and industries that are hoping to get relief, but it looks like they will not get it before session ends in a week. Today, September 6, is the last day to amend bills on the floor of the Assembly and no changes to our provision are expected. After that, the legislature has until September 13 to pass all bills.
This victory serves as another example of the power that CSEA has to improve the lives of Enrolled Agents in California. This is the kind of advocacy in action that your membership pays for and is critical for moving the profession forward. Please distribute this message to Members of your Chapter and Enrolled Agents everywhere, so that they too can share in this fantastic legislative victory. Congratulations to all!