EmploymentQuestion 25 of 1632

What is the "ABC test" used to determine in California?

a.Whether a subcontractor holds the proper CSLB license
b.Whether prevailing wage applies to a public project
c.Whether a worker is an employee or contractor
d.Whether a project requires a city building permit

Explanation

California uses the ABC test to decide worker classification (c). A worker is presumed an employee unless the hiring entity proves all three prongs: (A) free from control, (B) work outside the hiring entity's usual course of business, and (C) customarily engaged in an independently established trade. AB 5 first codified this at Labor Code §2750.3, but AB 2257 repealed that section in 2020 and recodified the test at §2775, with the construction-subcontractor route out of it at §2781. (a) licensing is a separate question under B&P §7000 et seq., (b) prevailing wage turns on Labor Code §1720 and §1771, and (d) permits are a building-code matter.

Law Reference: Labor Code §2775

This topic, taught in full in the CSLB Law & Business guide. CSLB Law & Business — Complete Study Guide (2026) — PDF + EPUB, $24.99 · 14-day refund →

Practice all 1632 questions free — no signup required.

Own the complete CSLB Law & Business guide — PDF + EPUB, $24.99 →

Related questions on this topic

Last reviewed: · editorial process

PrepPass team · Verified against California CSLB Contractor License Law & Business Exam · How we review
Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)
Report