California Community Theatre - Quick Survey on Assembly Bill 5 and Community Theatre Impact
New legislation (Assembly Bill 5: Worker status: employees and independent contractors) passed in Spring 2018 has left many Community theatres in the State wondering how to handle this new law. A detailed Feature Article was written earlier this year in California Community Theatre:
Now that you are informed of this change in legislation, how is your theatre handling the news? Please provide responses to the survey questions below.
Before receiving this survey, were you aware of the new legislation AB5?
Have you discussed the legislation and your theatre's response with
(check all that apply):
"We simply can not afford to comply for tax, wage, and insurance reasons. And, we can only imagine that there are LOTS of others like us."
What areas does this bill impact your operations (ie: are your designers or other staff are paid as independent contractors)?
Expect for one paid employee, all others who receive any money are given an honorarium, usually a fixed amount, not tied to any specific hours. Actors are given a travel stipend, a fixed amount, towards their travel expenses if they are in a show.
We now only pay those with their own company, insurance, etc. ex. lighting design.
Minimal impact. Show directors and musicians are the only ones who make enough to show up on the radar. I make sure they all qualify with these standards already.
Designers, actors, directors, instrumentalists, really all but our Artistic Producing Director and our Office Administrator. Everyone else is paid as a contractor.
How is your theatre handling this change?
No choice, we had to restructure.
We are worrying about it. Paying everyone as an employee will significantly increase our insurance cost as well as our wages.
Not yet discussed.
What is your first step in determining the action to take as an organization (ie: get legal advice, continue operations as we have historically), etc? The question is geared toward your very next step now that you are aware of the law.
We sought legal advice.
We are trying to figure out how to be in compliance and stay open.
Probably continue as we have historically. Otherwise, we would probably have to close down operations. We could not afford these changes for very long. We have volunteers but rely heavily on our experienced contractors.
If you are moving an independent contractors to employees, how are you handling the future impact on your state and federal tax burden?
Adding it to the budget. They all sign contracts showing wage and hours. They sign a statement that all hours above and beyond are as volunteers. Risky but only way to keep budget on track.
We will not do that.
We are worried not just about our tax burden. If they are employees, we have to pay them minimum wage, right?
No discussion yet.
If you are moving independent contractors to employees, how are you handling the future impact on your worker's compensation?
We have just begun negotiations with adp for workman's comp.
We will not be moving them.
We simply can not afford to comply for tax, wage, and insurance reasons. And, we can only imagine that there are LOTS of others like us.
No discussion yet.
Many thanks to the theatres who contributed to this survey and results.