We have been following closely to California’s new law AB-5. First reported in June, then later a follow up in earlier September when the law passed the Senate and made it’s way to the California governor’s desk.
Bodyslam reached out to lawyer Eric D. Anderson who has tweeted about the law’s effect on pro wrestling in the past to better explain the law.
Bodyslam: Will WWE be exempt from the law?
Eric D. Anderson: Well they won’t be exempt under the law as it stands now. What they may do is seek to fall under an exemption like with a “loan out company”. That is where the talent owns a production company and the WWE contracts with the production company and not the talent. The talent is then an employee of the production company. But this could get convoluted and they may want to avoid that.
Live event revenue is not the key to economic survival it used to be for WWE so the absolutely could avoid CA for all shows except a major event like Wrestlemania, Summer Slam or the Royal Rumble. Then they only deal with the issue once, theoretically.
But that theory may not hold because they do a lot of business in CA besides just wrestling matches.
Bodyslam: When you say “they do a lot of business” do you mean merchandise sales?
Eric D. Anderson: Yes.
Bodyslam: If anything happens to a WWE talent while wrestling in California, would the Superstar be treated as an employee?
Eric D Anderson: In Hollywood there are still close WWE ties. If they haven’t already, the WWE is probably going to need workers comp insurance here. Unemployment insurance as well. We won’t fill know until there is a challenge because I don’t see WWE just biting the bullet and complying. They didn’t do it when the Dynamex decision came down.
This law was created to combat the way companies like Uber and DoorDash treat their “independent contractors” even though they should be considered employees. Because of the ABC test for independent contractors, WWE could be effected.
Bodyslam will keep you updated on any follow ups or legislation that will effect WWE and wrestling in general.
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