Imagine waking up and finding out you just lost your job. The money you needed to make to pay your bills gone — in an instant.
That is happening to quite a few webcam performers, on Christmas of all days. It happened to former porn star Bibi Noel and it’s happening to hundreds of others. The reason? They live in the state of California. This was Bibi Noel’s only source of income.
These webcam models didn’t break any rules. They lost their jobs and are having their account closed because they live in the state of California and under new California regulations they are considered “employees” and that’s a problem. Because as employees they have strict employment laws that must be followed and that just doesn’t work for online webcam companies. Instead, companies like Streamate have no other choice but to terminate their relationship with these people.
Bibi Noel had been making her living on Streamate for years now and because she lives in California that’s no longer an option. Effective immediately, she’s fired. Her Streamate account has been closed.
The problem? Well as APAG union pointed out recently, “Technically all California cammodels could do a class action lawsuit against cam companies all the way back to April 2018 for tips, benefits, etc This is what streamate is trying to avoid.”
Streamate is working on a solution which they are calling “Cal Gems”, but all the details have yet to be finalized and until then, everything is up in the air for hundreds, maybe even thousands of webcam models who live in the state of California.
Employees come with rules (labor laws) that can be very costly for a potential employer. So if that company can’t hire someone as an independent contractor, then they have to comply with all the very costly labor laws which include a significant amount of regulation involving taxes, workers comp insurance, breaks, and insurance. Some experts say that it can so much as double the cost of an employee. So if you are going to pay someone $10 an hour, it’s estimated that the actual cost of the employee for the company is $20 an hour.
In California the rule is simple, is the person you hired doing something outside your normal line of work? In the case of a webcam company, that means all the webcam models are now no longer considered contractors. And that’s a potentially huge and very costly problem and not just Streamate. For some companies, they just terminated working with anyone from California to make it easy on themselves.
Streamate, however, is trying to come up with a solution that will allow at least some people from California to use their platform. How will it work? Who will get selected? All of these are unknown at this time.
Update December 28, 2019: We received an email from Liz, who is the Director of Marketing for Streamate. She wanted to let us know that they read our story about Bibi Noel and she wanted to assure us that it was done in error and the situation is now resolved and her account has been restored. Yes AB5 will be impacting models in California but they will have to work that out with models individually in the new year.
4 Responses
The title of the story makes it seem like Streamate is doing something sneaky. Its not their fault the state of California passed that law.
No, but they can do the right thing and change their payment system to make them employees like federal law already requires. California just decided to enforce it in the state themselves. The test that California uses is legally applicable nationwide — Trump just won’t enforce it.
Trump won’t need to enforce it because labor laws are a state level issue, not a federal one.
The Department of Labor has a codified federal definition of an employee, mainly to protect the IRS and the government from tax evasion and put 99% of workers on payroll deduction. The Dynamex decision was based on that definition. Trump’s officials could enforce that definition tomorrow if it wanted. Don’t feel too bad, even Democrats such as Barack Obama and Bill Clinton (yes, it goes back that far) didn’t put much into enforcing the legal employee definition.