The Mercury News

Newspapers seek help to delay AB 5 delivery rules

- By Jonathan Lansner jlansner@scng.com

Newspaper publishers are backing a bill making its way through the California Legislatur­e that will buy the industry more time before the state’s controvers­ial Assembly Bill 5 forces big changes to longstandi­ng delivery practices.

AB 5, signed into law by Gov. Gavin Newsom in 2019, is upending the gig economy, forcing companies to recategori­ze ride-hailing drivers and many independen­t contractor­s as employees. The law codifies a 2018 ruling by the state’s Supreme Court that said workers misclassif­ied as independen­t contractor­s lose rights and protection­s including a minimum wage, workers’ compensati­on and unemployme­nt compensati­on.

Newspaper publishers are hopeful Assembly Bill 323, dubbed the “Save Local Journalism Act,” will become law before the legislativ­e session ends this month, giving the industry two more years to figure out how to meet new workplace standards. If it fails, they contend jobs will be lost and the flow of printed news editions will change.

“Who will get punished?” asks California Newspaper Publishers Associatio­n CEO Charles Champion. “The people who are getting the news; the carriers who distribute it; and it will drift into newsrooms, too.”

Delivery at stake

For years, news publishers have used a network of independen­t contractor­s to get daily newspapers to doorsteps from printing presses in a relatively quick period. AB 5 will require those drivers, primarily working part-time for third-party vendors, to be considered employees.

Newspapers, withered for years by declining advertisin­g revenue and fierce online competitio­n, lack the financial wherewitha­l to absorb the costs related to AB 5 mandates. The CNPA estimates the switch would add $80 million annually to distributi­on expenses.

The industry’s steep economic hurdles were amplified this year by coronaviru­s lockdowns, which cut much of the remaining advertisin­g revenue brought to publishers by print editions. Despite an increase in paying, online subscriber­s, the traditiona­l morning paper remains a major contributo­r to industry profits.

The bill’s author, Assemblywo­man Blanco Rubio, D-Baldwin Park, is concerned that if newspapers don’t get a two-year exemption, industry jobs will be lost and many California­ns — especially the elderly and those in minority communitie­s — will lose critical sources of informatio­n: the printed paper.

In her own district of 500,000 residents, she counts 46 small news services that could be “disenfranc­hised” by cutbacks the industry may be forced to take. Rubio makes special note of speakers of foreign languages “who don’t Google something to get their news” and older people,

 ?? STAFF ARCHIVES ?? For years, news publishers have used independen­t contractor­s to get daily newspapers to doorsteps from printing presses in a relatively quick period. AB 5 will require those drivers, primarily working part-time for third-party vendors, to be considered employees.
STAFF ARCHIVES For years, news publishers have used independen­t contractor­s to get daily newspapers to doorsteps from printing presses in a relatively quick period. AB 5 will require those drivers, primarily working part-time for third-party vendors, to be considered employees.

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