The life of a beauty pro can be extremely rewarding. From pursuing your passion and expanding your network to working for yourself and helping your clients achieve their dream results, immersing yourself in the world of beauty is full of opportunity and possibility.
While following your passion and becoming the hair stylist you’ve always wanted to be comes with a level of freedom and flexibility that is difficult to find elsewhere, even the most successful beauty pros must follow beauty professional regulations.
Being familiar with these guidelines and rules is essential to your ability to follow them and protect yourself (and your livelihood) from consequences. The Borello test and its relationship to California Assembly Bill (AB5) are excellent examples of this principle and are affecting hair stylists now more than ever.
Key Takeaways
The Borello test is used to determine if a hairstylist is an independent contractor and properly classified as such. Knowing how the Borello Test works is key to ensuring you are in compliance with this beauty professional regulation.
Beauty Professional Regulation and the Borello Test - What You Need to Know
What is the Borello Test?
Currently applicable to beauty salons, the Borello test is designed to determine whether or not a hair stylist who claims to be an independent contractor is properly classified as one. This includes discerning whether the salon controls the manner and means through which it accomplishes its desired results. The caveat? Those controls do not need to be actually exercised, detailed, or direct.
To make this determination, the test uses a handful of factors (including the factor of control), such as:
- Is the stylist engaged in business or an occupation distinct from the salon?
- Is the stylist’s work integral to the salon’s business?
- Does the stylist or salon supply the stylist with the instruments, tools, and place necessary to work?
- Has the stylist invested in the salon, including the equipment or materials necessary for the stylist to work?
- Does the service require specialized skills?
- What is the stylist’s opportunity for profit (or loss) that depends on managerial skill?
- How long are the services to be performed?
- How permanent is the working relationship?
- What is the method of payment (for either the job or the time)?
- Does the stylist have employees?
- Can the salon fire the stylist, or would termination be a breach of contract?
- Do the salon and stylist believe they have an employer-employee relationship?
How the Borello Test Impacts Hairstylists
Using the factors listed above, courts analyze a hair stylist’s situation on a case-by-case basis. There isn’t a single factor that determines the outcome, and different factors may be emphasized (or not) depending on the case at hand.
Why is this important? Because under California’s new assembly bill (AB5), it is harder than ever for workers to be classified legally as independent contractors. For salons that work with independent contractors, this new beauty professional regulation could spell disaster.
We’re talking about huge fines for misclassifying workers under the new rules. They can even be found in violation of the Fair Labor and Standards Act, which brings on an increased risk of legal action. In other words, passing the Borello test is of the utmost importance for salons and hair stylists who want to continue with their independent contractor arrangement.
Going forward, it is extremely likely that independent hair stylists will follow in the footsteps of manicurists. In California, nail salons can no longer have independent contractors or rent out booths to people. Instead, those individuals will be classified as employees and entitled to minimum wages, overtime pay, meal and rest breaks, and legal protection.
What Should Hair Salons and Hair Stylists Do?
For many years, the independent contractor route was normal in the beauty industry. Now, such arrangements and relationships are under scrutiny, and drastic change is on the horizon. Don’t be surprised if the independent contractor model that is so common in the world of hair stylists is soon challenged.
If you are a salon owner wanting to maintain your independent contractors or a hair stylist who wants to remain independent, there are a few precautions you can take to set yourself up for success when these beautiful professional regulation changes do occur.
First, examine the agreement you have to make sure that all legal requirements to remain independent contractors are met. Secondly, adhere to those agreements and practice them without compromise. Otherwise, the Borello test could expose your arrangement as misclassified and open you up to legal action.
Staying up-to-date with the latest beauty industry news, beauty professional regulations, and important legal information can be difficult. That’s why we encourage you to subscribe to Beauty Insurance Plus–so you can stay in the know as the world of beauty evolves.
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