The Sacramento Jazz Cooperative Inc has heard from many of our members, constituents, and customers concerning the new AB 5 Legislation. Many legal authorities, attorneys and CPAs have advised in complying with AB-5 until an exemption is carved out or the law is amended. Musicians need to have an exception, and everyone should continue to contact their legislature to make their concerns known. WE NEED AN EXEMPTION! There are no workarounds to compliance. SJC has taken the position to comply with this law. What does this mean exactly for you and us?
Musicians working for SJC will take home less money from their pay but pick up some benefits not previously had. Besides making deductions from your wages, we have a requirement to pay additional payroll taxes.
1. All musicians working an SJC gig will now receive a W4. This is a requirement, and no signed W4 means we cannot pay you. Any previously signed Independent Contract is invalid. Because we are a music business, your relationship with SJC may be different from that with others in a different industry, like restaurants and bars.
2. If you are the leader of a band, we will issue the W4 to you. We are researching the matter, and it could be necessary for us to provide a W4 to your sidemen as well, for Workers Compensation purposes. More on that later.
3. As an employee SJC will pay: (THIS MEANS WE PAY)a. 3.4% Unemployment Tax (UI) based on your negotiated salary
b. 1% Employee Training Tax (ETT), and
c. Match your 7.5% FICA deduction
4. As an employee, SJC will DEDUCT the following from your pay (THIS MEANS YOU PAY) and submit to the state and federal agency either monthly or quarterly as required by law:
a. .001% State Disability Ins (SDI) (Limit $7000 is exempt)
b. State and Federal Personal Income Tax (PIT) based on your W4 election
c. 7.5% Social Security Tax (FICA)
5. If you are a member of a union, we will deduct the 3% Work Dues and forward it to the AFM. There is no requirement to be in the union. Musicians can be a member of any local they choose.
6. SJC is currently negotiating with various Insurance Companies to find the best Workers Compensation coverage. Workers Compensation covers any employee that is injured or becomes ill while performing their job. This is a protection to the employee as well as the employer.
7. SJC pay periods will be weekly, on the Monday following the performance. It will no longer be practical to be paid after the job.
More Information and any updates will be added to this website