Under AB5, a contractor wants to classify a tile installer as an independent contractor. The installer works exclusively for this contractor and uses the contractor's tools. Under the ABC test, this arrangement would likely be classified as:
Correct Answer
A) Employee because the work fails both 'A' and 'C' prongs of the ABC test
The ABC test requires all three prongs to be met. This arrangement fails prong A (contractor controls the work) and prong C (installer doesn't work independently for others), making the installer an employee.
Why This Is the Correct Answer
The ABC test requires all three prongs to be satisfied for independent contractor status. Prong A fails because the contractor controls the work (exclusive arrangement implies direction and control). Prong C fails because the installer works exclusively for one contractor and therefore is not customarily engaged in an independently established trade serving multiple clients. Failing any single prong means the worker must be classified as an employee.
Why the Other Options Are Wrong
Option B: Independent contractor because construction work qualifies for the B2B exemption
The B2B (business-to-business) exemption under AB5 requires the worker to have their own business entity, set their own rates, have their own clientele, and perform work in a genuinely independent capacity. An installer working exclusively for one contractor using that contractor's tools does not meet B2B exemption criteria.
Option C: Independent contractor if the installer has a business license
Having a business license alone does not satisfy the ABC test or qualify for any exemption. Prong C requires the worker to be 'customarily engaged in an independently established trade,' which means actively working for multiple clients — a license is only one piece of that.
Option D: Employee because the work fails the 'B' prong of the ABC test
This option incorrectly identifies only the B prong (work outside the usual course of the hiring entity's business) as the failing factor. In reality, both prongs A and C fail in this scenario. Identifying only one failing prong understates the strength of the employee classification.
Memory Technique
Use 'A-B-C = All three or you're an employee.' A = free from control (who has control here? The contractor — fail). B = outside usual business (tile work inside a contracting business — likely fail). C = independently established business (works exclusively for one — fail). Three strikes = employee.
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