The ABC test defines if a worker is an employee or independent contractor in California.
Note: The ABC test must be used for the purpose of the Unemployment Insurance Code beginning January 1, 2020.
A worker is considered an employee and not an independent contractor, unless the hiring entity meets all three conditions of the ABC test:
- The person is independent of the hiring organization in connection with the performance of the work, both under the contract for the performance of the work and in fact.
- The person performs work that is outside the hiring entity’s business.
- The person is routinely doing work in an independently established trade, occupation, or business that is the same as the work being requested and performed.
Note: Workers are considered employees unless proven otherwise. The hiring organization must show that workers meet all conditions of the ABC test in order to classify them as independent contractors, unless there is a statutory exclusion or determination of employment.
ABC Test Exceptions
The ABC test is used for most workers, but for some jobs, industries, and contracting relationships, the Borello multifactor test applies.
For more information, visit the Employment Status Portal.
Help Us Fight Fraud
Hiring entities are responsible for classifying their workers correctly. We will continue to inspect and audit hiring entities to make sure they meet payroll tax requirements. These efforts make sure state laws protect workers and prevent unfair competition that may lead to higher taxes and expenses for businesses.
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Last Revised: 06/21/2022