Why would a ruling by the state’s top court affect you and your passion for a career in Barbering or Cosmetology? Because when the California Supreme Court came down on the side of former employees and against a company that labeled them as “independent contractors,” it affected all kinds of independent workers—including Barbers and Stylists.
Back in 2004, in an effort to increase its profits, Dynamex, a same-day courier and delivery service company, changed the status of its drivers from employees to independent contractors. That meant that Dynamex was no longer responsible for such employee costs as social security, medicare, workmen’s compensation, and health insurance. Since its delivery force was now made up of independent contractors, the company’s employment costs plummeted.
Under these new rules, Charles Lee became an independent contractor for Dynamex, but left soon after and filed a lawsuit, along with others, saying that he should be considered an employee, not a contractor. He said that Dynamex was “engaging in unlawful business practices.”1 Fast forward to 2018 and the Supreme Court of California’s decision. The court agreed with Lee. Lee and his fellow truck drivers should never have been labeled independent contractors. They were employees.
But what do a bunch of truck drivers have to do with you and your career as a Cosmetologist or Barber? A lot! Because technically, you can no longer rent a chair as an independent contractor in a salon you don’t own. Salon owners now need to hire you outright—as an employee.
What the Rules Say:
Calling it an ABC test, the new rule says that you need to be classified as an employee unless:
“(A) that the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact; (B) that the worker performs work that is outside the usual course of the hiring entity’s business; and (C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.”1
And what all that means is that there are a lot of confused and angry barbershop/salon owners, barbers, and cosmetologists.
The owner of downtown Sacramento’s Bottle and Barlow, Anthony Giannotti, says all seven of his barbers quit after the ruling.
“I lost my entire staff,” said Giannotti, because you “cannot classify someone as an independent contractor if they offer the same service that is the primary business of the business.”2
Since barbers and cosmetologists are usually classified as independent contractors in California, the court’s ruling could have far-reaching repercussions.
“It doesn’t just affect my business, it affects every independent contractor in the state of California,” said Giannotti.2
As the beauty industry across the state tries to figure out how this ruling will affect them, there may still be some ways to evolve with the rules. According to the Legal Counsel to the Professional Beauty Federation of California Fred Jones, “It is still possible for some booth rental salons to survive legal scrutiny under this ABC test, like those with clear physical and operational separation from the establishment owner—who may also be leasing space to non-beauty related tenants.” But he also believes that “the vast majority of booth rental salons as currently constituted in California are now in legal jeopardy.”3
At Salon Success Academy, we’ll help you understand the ins-and-outs of your career in the beauty industry, from how to attain the skills you’ll need to how you can navigate these new rules. Contact us today to schedule a campus tour.