by Mitch Kokai
Senior Political Analyst, John Locke Foundation
If I lived in California, I’d be staring down unemployment.
A new law governing freelance work was signed into law late last month. It isn’t scheduled to take effect until January, but if panicking freelancers aren’t able to force a change before then, many will be banned from doing their jobs. It’s a classic case of well-intended but functionally destructive regulation: In the name of protecting workers, Assembly Bill 5 will prohibit some them from working. In the resultant chaos, a lucky few will secure full-time jobs while the rest are “helped” right out of a stable income stream.
A.B. 5’s primary target is gig employers like ridesharing apps Uber and Lyft, whose drivers are classified as contract workers, not employees. That means they aren’t entitled to benefits like health insurance or paid time off even if they’re working full-time hours, which A.B. 5 seeks to change. The law sets up stricter rules to push these workers across the line into employeedom and make provision of benefits mandatory.
Naturally, Uber and Lyft have already announced they have no intention of changing how they classify their drivers. “Just because the test is hard doesn’t mean we won’t be able to pass it,” said Uber’s chief legal officer, Tony West, last month. “We continue to believe that drivers are properly classified as independent [contractors],” he added, vowing readiness for a legal fight.
So A.B. 5 may well fail to achieve its main goal. But that doesn’t mean it won’t produce any changes. On the contrary, it will effectively make freelance writing and other creative work illegal, even while appearing to accommodate workers’ needs.