Millions of Independent Contractors May Join the “Leave Us Alone” Coalition in 2020

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Posted by Pavle Djokic on Wednesday, June 24th, 2020, 5:06 PM PERMALINK

In the midst of a global pandemic that has caused economic shutdowns responsible for over 40 million Americans filing for unemployment, Joe Biden’s recent tweet supporting California’s “gig worker bill” received unexpected bipartisan backlash. This legislation, Assembly Bill 5 (AB 5), established a three-step “ABC” test to define and limit who was technically an employee versus an independent contractor.

In response, hundreds of independent contractors shot back with their stories of how they lost their jobs and income last year before Covid-19 was even a threat. Jennifer, a healthcare interpreter shared how AB 5 severely threatened her ability to freely translate and assist immigrants to access Medicare. Even though she voted for Joe Biden in the California primary election, she wrote that “my vote in November is conditioned on whether you change your position on this widely misunderstood law which affects 300+ professions.”

Jennifer was joined by hundreds of other independent contractors that lost their income-earning opportunities in California because of AB 5’s damaging anti-worker provisions. From freelance journalists to musicians and entertainment professionals, once Californians experienced the work flexibility limitations of AB 5, many finally understood just how damaging Democratic attacks on independent contractors really are.

AB 5 harms independent contractors by expanding a 2018 California Supreme Court decision that establishes a three-step ABC test forcing the reclassification of workers and limiting the hiring of independent contractors across the state. Despite being opposed by 71% of app-based drivers, for example, Governor Gavin Newsom (D-Calif.) signed the bill into law last year.

While most of the media attention around AB5 was its effect on the gig economy, the legislation had much broader implications for the rest of California’s thriving independent contracting workforce. Due to inconsistent and arbitrary exemptions for certain professions, up to 50% of Californian independent contractors are potentially impacted by AB 5.

From freelance writers and photographers to 70,000 owner-operator truckers to the vast majority of the California entertainment industry, hundreds of thousands of the two million Californian independent contractors may have directly been affected the bill’s limitations on work opportunities moving forward. Fewer than one in ten independent contractors support worker reclassification due to the numerous additional benefits that independent contracting provides, including flexibility of hours to autonomy of work. That may explain why that in the six months since going into effect, there have been nearly three dozen bills introduced to repeal, amend, or replace AB 5 along with numerous lawsuits against the state.

This effort isn’t limited to California, however. The effort to bring California’s anti-independent contractor crusade has gone national, with recent passage of the Protecting the Right to Organize (PRO) Act in Congress.

Supported by House Speaker Nancy Pelosi (D-Calif.) and presumptive Democratic Presidential nominee Joe Biden, the PRO Act has already passed the House of Representatives. Though currently dead at Senate Majority Leader Mitch McConnell’s desk, it remains a massive threat to American independent contractors should the balance of power shift in November. Provisions in the PRO Act include expanding California’s ABC test as a nationwide entrepreneurial limitation, invalidating state Right-To-Work laws, and removing the secret ballot from union elections.

Between 2001 and 2016, America’s independent contracting workforce grew by over 22% to 13.8 million workers according to IRS data. The independent contractors workforce represents up to 8.5% of the GDP. The actual number in 2020 may be much higher as well, due to the emergence of the a more diverse gig economy in the past four years.

Critical to the 2020 election, many individual swing states have seen above-average growth rates of independent contracting, according to the IRS. Of the fourteen targeted presidential swing states likely to make the difference in the upcoming election, Florida, Arizona, and Nevada are also the top three states that saw the highest degree of independent contracting growth in recent years. Florida and Arizona both saw approximately a 75-point rise, and Nevada experienced a 90-point increase.

In 2016, the growth amounted to nearly 1.2 million independent contractors working in Florida alone, putting the contingent at over 11% of the entire workforce in the Sunshine State. Similarly, in 2016 there were 300,000 Arizonan and 130,000 Nevadan independent contractors, equaling approximately 8.6% of their state’s workforces.

The unrivaled growth of independent contracting in these three important swing states may partially be attributed to the fact that all three strictly adhere to the federal flexible workforce guidelines established by the Department of Treasury. Across the nation, many states have taken their own measures by implementing their own restrictions on worker freedom, with not a single one of these states, including California, in the top ten states of independent contractor growth.

Just as hundreds of thousands of Californians had no idea their independent contracting jobs were going to be put at risk due to AB 5, millions of Americans in these three swing states alone may not yet be aware of Joe Biden’s stated opposition to the income-generating opportunity of independent contracting.

Outside of Biden’s strong support for AB 5 and the PRO Act, his administration would have the power to take other steps against worker freedoms. President Trump’s National Labor Relations Board and Department of Labor have both released memorandums supporting gig economy workers as independent contractors. Within days of taking office, Biden could potentially reverse these decisions and open the door for forced worker unionization and federal lawsuits against firms like Uber or Doordash.

The backlash Joe Biden received for his endorsement of AB 5 was justified and looking towards November, independent contractor voters should consider the consequences of a Biden presidency on their financial well-being. As Democrats across the country push for narrowly defined employment laws at the state and federal level, independent contractors may become the newest politically significant group of voters who just want the government to leave them alone.

Photo Credit: kgroovy

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