Kamran Mirrafati, partner and litigation lawyer with Foley & Lardner LLP, works in the firm’s Los Angeles and San Francisco offices. A member of the firm’s labor and employment practice, he’s been fielding questions from clients regarding AB5 for months now. His best advice comes in a three-pronged process.

The least risky approach is to reclassify your independent contractors as employees. “If you only have a few workers, it won’t change your whole business model,” Mirrafati says.

The riskier approach is to reconfigure your operations to minimize liability. Part B of the ABC test requires work performed by the contractor to be unrelated to the main purpose of your company. For example, if you’re a bakery and you hire an electrician to fix your oven, you’re in the clear. But if you bring in contractors to be your cake decorators, those workers would be classified as employees under AB5. “Companies are likely to litigate this particular issue in a lot of detail,” Mirrafati says.

The riskiest approach is to just wait and see. “The risk of a class-action lawsuit is pretty high right now,” Mirrafati says. “There is so much heightened scrutiny on independent contractors, companies are more likely to get hit with a suit and have those arrangements questioned. Judges will be hypercritical because they’re thinking differently. If a contractor was correctly classified five years ago, that arrangement may not be OK now.”

Roughly $20 million in additional funding in California Governor Gavin Newsom’s proposed 2020 budget will go toward enforcing Assembly Bill 5, the San Francisco Examiner reported. That includes $17.5 million for the Department of Industrial Relations to “address workload” associated with more workers using workers’ compensation, and “investigations of labor law violations” related to worker status, wage claim filings and workplace health and safety inspections. It also includes $3.4 million for the Employment Development Department to train staff and administer the ABC Employment Test as mandated under AB5, and to conduct hearings and investigations on workers’ status. The Department of Justice will also net $780,000 to address increased enforcement actions expected under AB5.

“All it takes is one unhappy sales rep to go to an attorney,” says Fully Promoted President Mike Brugger. “People interpret the law in different ways, but it wasn’t designed for us. If Uber and Lyft are arguing they’re simply an app that connects people, well, we have technology platforms in our industry also. What’s not to say if they lose, we won’t be affected with our industry platforms?”