This post discusses why – especially now that Assembly Bill No. 5 (AB-5) has taken effect – in California corporate officers are considered employees rather than independent contractors.
California Corporate Officers Employees by Statute
The starting point is California Unemployment Insurance Code Section 621. This Section states, in relevant part:
“Employee” means all of the following:
(a) Any officer of a corporation.
This post about corporate stakeholders is based largely on my answer to a Quora question. Please see How many companies do you think will adopt the Business Roundtable’s statement that the purpose of a corporation is to take into account ALL stakeholders
The Business Roundtable describes itself as an association of chief executive officers of America’s leading companies. On August 19, 2019, the Roundtable garnered headlines when it announced that it had redefined the purpose of a corporation to promote an economy that serves all Americans. In my opinion, that characterization is not accurate.
Roundtable Statement about Stakeholders…
Here is what the relevant portion of the Roundtable’s Statement on the Purpose of a Corporation says:(more…)
This post describes California employees’ rights to inspect, and receive copies of, their personnel records.
The relevant statute is California Labor Code Section 1198.5(a), which states:
Every current and former employee, or his or her representative, has the right to inspect and receive a copy of the personnel records that the employer maintains relating to the employee’s performance or to any grievance concerning the employee.
This post explains what dissociation is. This is part of Dana Shultz’s Canonical Questions on the Law® series of questions and answers about legal issues, concepts and terminology.
Definition of Dissociation
Dissociation is the process by which one:
- Stops being a member of a limited liability company (LLC); or
- Stops being a partner in a partnership.
Alternatively, this process sometimes is called withdrawal.(more…)
In How Can I Move My Corporation to Another State?, I explained that there are three ways to move a corporation from one state to another. This post describes one of those ways: Reincorporation.
Three Ways to Move among States
That earlier post described those three ways to move a corporation to another state as follows: (more…)
In How Can I Move My Corporation to Another State?, I discussed redomestication, i.e., how to move a legal entity from one state to another. In this post, I explain how to redomesticate an entity when the existing state’s law prohibits redomestication.
California Corporation Cannot Redomesticate
About a year ago, the CEO of a California corporation contacted me. He was relocating to Pennsylvania, so it made sense to move his corporation there, too. Unfortunately, California does not permit its corporations, in contrast to limited liability companies (LLCs), to redomesticate. (Please see the CA Secretary of State’s Conversion Information page.)(more…)
This post explains how to make sure that you own work product and intellectual property (IP) when you use a freelancer service. Most of the following first appeared on Quora. Please see How can I protect my source code and its Intellectual Property Right while working with a very large team of remote freelancers (Upwork and Fiverr etc)? Are freelancing platforms ensuring IP protection?
When you use a freelancing platform, you need to ensure that you have an agreement with each freelancer. And that agreement must assign to you all work product and all intellectual property rights.(more…)
A fictitious business name (FBN) is California’s term for a DBA (“doing business as”). This post explains the State’s FBN publication requirement and describes how I have selected newspapers for this purpose.
Once you file your FBN statement with the clerk of the applicable county, you have 30 days to arrange for a “newspaper of general circulation” in that county to publish that statement once a week for four weeks. Business and Professions Code Section 17917(a)(more…)
This post explains what non-voting shares are and why a corporation might want to authorize them. This is part of Dana Shultz’s Canonical Questions on the Law® series of questions and answers about legal issues, concepts and terminology.
In this post, I will focus on non-voting common shares. Preferred shares raise issues that go well beyond voting rights. (See What Is Preferred Stock?)(more…)
This post discusses whether founders should authorize preferred shares, in addition to common shares, when they incorporate.
As I discussed in What is Preferred Stock?, corporations typically issue preferred shares to institutional investors, such as venture capitalists (VCs). The term “preferred” refers to preferences that those shares have relative to common shares.(more…)