Freelancers are freaking out about the PRO Act. Here is why they should – and shouldn’t – be worried.

PRO act Bobby Scott
Rep. Bobby Scott (D-VA), Chairman of the House Committee on Education and the Workforce, speaks during a press conference advocating for the passage of the Protecting the Right to Organize (PRO) Act in the House of Representatives on February 5, 2020.

  • The PRO Act, which passed in the House, includes a metric for reclassifying workers that freelancers object to.
  • Many independent contractors don’t object to the right to collective bargaining, but worry the bill could set a dangerous precedent.
  • Lawmakers must strip the “ABC test” from the bill.
  • Larry Buhl is a multimedia journalist, author, and podcast host.
  • This is an opinion column. The thoughts expressed are those of the author.
  • See more stories on Insider’s business page.

Back in 2019, I predicted that California Assembly Bill 5 (AB5), which upset the independent contractor world by reclassifying freelancers in hundreds of occupations as employees unless they could prove they’re not, would be seen by other lawmakers as a road map, rather than a cautionary tale. And here we are: a new bill working its way through Congress, the Protecting the Right to Organize Act of 2021 – or PRO Act – should give independent contractors across the country reason to worry, though not necessarily because of the intent of the legislation.

The ABC test

What made AB5 so problematic was its reliance on the ABC employment test to classify workers. ABC says a freelancer should be an employee, unless:

“A) The worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact; and

B) The worker performs work that is outside the usual course of the hiring entity’s business; and

C) The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.”

The worker must meet all three. Part B is where many independent contractors went through the buzzsaw: If you’re in the same business as a client, you must be an employee, and, presumably the company would hire you, even if you’ve only been putting in a few hours a week for them. Yet, instead, most employers are just not working with California freelancers anymore.

ABC is also the basis for reclassification in the PRO Act, which passed the House of Representatives earlier this month with bipartisan support. However, there’s one big difference: While AB5 reclassified employment status for workers in California, the PRO Act reclassifies freelancers nationally, but only for the purpose of collective bargaining rights. That’s all – or so it states. Supporters say it “levels the playing field” for unions, to give more people the right to vote in union elections.

I spoke with Professor Michael LeRoy, an expert in labor law and labor relations at the University of Illinois Urbana-Champaign, to find out whether freelancers should worry about the PRO Act. He said there’s been some hyperbole and misunderstanding about it.

“Does [the PRO Act] force you to be in a union? No. If 10 million [freelancers] are classified as employees, a certain amount will want to form one or join one, but they could also vote no,” he told me.

I’d be okay with more people being able to collectively bargain if they want. Freelancers I spoke with aren’t apoplectic about theoretical pressure to join a union, either. What does concern us greatly is the ABC test being used to reclassify independent contractors for any reason. Almost everyone I spoke with feared the ABC test would be misapplied by companies who read the reclassification part of the law, but miss the part about unions. Freelancers also worry that the ABC test will set a precedent for future legislation. It already has: Several states used AB5 as a model when proposing new “gig worker protection laws.”

Unintended consequences

Fred Topel, a Los Angeles-based entertainment journalist and co-leader of California Freelance Writers United (CAFWU), implored national lawmakers to not use the ABC test. “If you take out the ABC test, I think a majority of [CAFWU] members would support it. We’ve seen no evidence that AB5 worked as lawmakers intended, but plenty of evidence of unintended negative consequences from the ABC test,” he said.

Robert Sette, a freelance translator in Denver, predicted that any big change to labor laws using the ABC test would make hiring companies think twice about using independent contractors. “Many won’t see [the PRO Act] as only for labor organizing. They’ll see this as a risk management issue. To avoid possibly running afoul of the law, they’ll cut loose freelancers.”

That did happen in California. The Facebook group Freelancers Against AB5 has been compiling personal stories of independent contractors in California who lost work and income directly as a result of that law, well before the COVID-19 crisis. Based on dozens of “no Californians need apply” notices citing AB5 as the reason, it appears that many companies were so bewildered by the law and scared of fines for possibly violating it, they simply gave up on California independent contractors.

The road to career hell was paved with good intentions

After AB5 passed, I joined CAFWU and other advocates in California to petition state representatives to amend the law. We succeeded in getting exemptions for some professions.

Through the process, we learned that most lawmakers had no clue about the scope of the independent contractor world, and assumed most people deriving an income were either employers, employees, or exploited would-be employees. The bill’s biggest proponents said, in so many words: Don’t worry if you lose work because all your clients will hire you full time, with benefits! We explained that’s not how it works, emphasizing that most independent contractors are thriving professionals.

I recognize that some independent contractors do want full-time work, and that many other workers are truly misclassified and exploited. There should be protections from misclassification, except – there already are laws covering that. Any worker can sue for misclassification right now – albeit with difficulty.

We don’t need new laws that help some, but also legislate hundreds of thousands of successful careers out of existence. LeRoy agreed the ABC test is a blunt tool that “oversimplifies” the labor force and would need “significant refinements” and exemptions if kept in place. A potential solution could be a multi-factor balancing framework to determine who’s an employee, one like the IRS uses.

In order to prevent the ABC test from wreaking havoc on more independent contractors’ lives, constituents must start conversations with their representatives, starting with the Senate subcommittee members that will be discussing it. They could point to surveys showing that 30% of the US workforce is either self-employed or hired by the self-employed and estimates that freelance income is nearly 5% of GDP.

Stripping the ABC test from the PRO Act could prevent lawmakers from proposing more damaging bills, like the one written last year by Democratic Senators Patty Murray of Washington and Sherrod Brown of Ohio. Their bill gives some benefits to temp and gig workers, but, like AB5, it uses the ABC test to sweep all professions into its net.

This shouldn’t be a partisan issue, but sadly it is. Many Republicans insist any labor protections will hurt business and therefore can never be considered. Based on comments from AB5’s proponents, many Democrats assume what’s good for unions surely benefits everyone. Labor classifications must be more nuanced than that because today’s labor market is complicated.

Pro-labor lawmakers need to understand that freelancers are not necessarily suffering gig workers, or getting by until they land a “real job.” They should either toughen enforcement of existing laws or make sure new laws explicitly help workers who need protections, but not hinder independent contractors’ ability to earn a living. Labor law shouldn’t be a zero sum game.

Read the original article on Business Insider

New York City just granted protections to fast food workers. It may be a model for protecting essential workers across the country.

fast food protests new york minimum wage
Protesters with NYC Fight for $15 gather in front of a McDonalds on February 13, 2017 in New York City.

  • New York City just passed a law saying employment in the fast food industry will no longer be “at will,” but must require “just cause” for firing workers. 
  • The law will provide workers needed protections by making it harder to fire them. 
  • If the effects of the law are positive, this could be a model for protecting essential workers across the country. 
  • Vincent White is a partner at White, Hilferty & Albanese, a national employment law firm.
  • This is an opinion column. The thoughts expressed are those of the author. 
  • Visit the Business section of Insider for more stories.

At a moment of unprecedented insecurity for millions of American workers, New York City is once again functioning as a vital laboratory for the future of protecting American workers.

In 2019, after the city increased its minimum wage to $15 an hour, states from New Jersey to California followed with plans of their own to boost wages. Now a new law, passed in January and taking effect in July, will strengthen the job security of fast food workers in New York City and could be a model for more localities across the US.  That’s because after July, employment in the industry will no longer be “at will.” Instead, employers will have to show “just cause” for firing workers. 

This is a bold and important experiment, one that could bring more stability to workers in a notoriously difficult and high-turnover employment sector. The new law may also hasten a shift toward automation and impose costs on the operators of franchises at a time when New York City is struggling with massive revenue losses. Whatever the results of the new law, it’s encouraging to see a major American city move beyond stale talking points in policy debates and actually introduce a forceful, targeted intervention in labor law. 

Many experts predicted that raising New York City’s minimum wage in 2019 would harm both revenue and employment. But contrary to these doom and gloom predictions, both increased. People were willing to pay a bit more to eat in restaurants, and everyone was able to benefit. This new law could also easily surprise us in a variety of ways.

What are “just cause” protections? 

The “just cause” standard, while vague around the edges, can provide powerful protections for workers. 

Under the old law, those who did not agree to cover last-minute shifts or work overtime might be fired with relative ease, perhaps on the pretext that they were not a “team player.” The language in the new law requires application of “progressive discipline,” which means that termination can occur only after a series of graduated interventions proportionate to any infractions of policy. 

What’s more, this discipline cannot be arbitrarily dispensed according to the fluctuating whims, grudges, or agendas of a particular boss. It must be “reasonable and applied consistently,” a substantive legal phrase that provides genuine protection to workers.

In cases of obvious misconduct, fast food restaurants will still be able to fire employees. Assaulting the boss, spitting in the food – any reasonable judge or arbitrators would regard these as just causes for termination. In borderline cases, however, things will become more interesting. Is lagging productivity a legitimate reason for dismissal? A bad attitude that undermines morale without violating any policy? These cases are murkier. 

The potential benefits of “just cause”

Absent this new law, employers probably would not think twice before dismissing workers in such scenarios, figuring that in an industry with annual turnover rates that often exceed 100%, they could always find another worker. Many more employers are now likely to be deterred from quick dismissals by the prospect of a longer and legally mandated process, which could trigger back pay for unlawfully terminated employees and statutory penalties of $500 for each violation. 

This could result in more careful selection, training, and treatment of workers. It makes sense to invest more in choosing workers carefully and keeping them happy if you know that they are harder to dismiss. This could even cause upward pressure on wages as franchises compete to attract and retain good workers. 

On the other hand, there might be fewer fast food jobs if the new law increases operational costs and decreases turnover. Critics also worry that employers might be permanently stuck with chronically underperforming employers they are unable to dismiss. 

There’s some legitimacy to this fear, but it needs to be weighed against the benefit of decreasing unjust and arbitrary terminations. It’s also important to remember that the new law is currently limited to the fast food industry; businesses with profit flowing in from locations around the country and world can afford to treat workers a bit better in New York City. And if the local owners of New York City franchises are affected by the expense of these new laws, the wealthy national companies that grant these franchises could help their local operators with extra costs.

Rather than such a generous course of action, however, corporate fast food mammoths may simply accelerate the shift to automation that has already begun. McDonald’s spent nearly $1 billion in 2019 adding ordering kiosks and other automation technology to stores. 

As current mayoral candidate Andrew Yang has stressed, this transition is likely inevitable in a range of industries over the coming years. Rather than postponing it, a more intelligent strategy may be to increase the security and wages of those jobs that can still only be done by humans. There’s even an argument for hastening the arrival of automation: if it’s going to happen anyway, the sooner we begin to experience its full disruptive effects, the sooner our economies and political systems will be forced to develop sustainable responses. 

A final virtue of this new labor law is its granting of genuine workplace protections to those we celebrate as essential workers during the pandemic. Many of these workers already rely on public assistance programs because of low wages, and they now face additional risk from a deadly virus on a daily basis. 

If we care about helping such people, a disproportionate number of whom are from immigrant and minority communities, it’s long overdue to provide them with more than a hollow bit of celebratory rhetoric about how they are “essential.” New York City’s bold new law could be a crucial step in the right direction. The rest of the country will be waiting to see the results. 

Read the original article on Business Insider

Yes, your boss can require you to get the COVID-19 vaccine. Labor lawyers weigh in on what rights employees have.

covid vaccine trial
Lisa Taylor receives a COVID-19 vaccination from RN Jose Muniz with the help of Karenda Palmer, a staff member, as she takes part in a vaccine study at Research Centers of America on August 07, 2020 in Hollywood, Florida.

  • The EEOC says employers can require employees get a COVID-19 vaccine or ban them from the office.
  • One lawyer predicts that most employers will strongly suggest, not require, vaccination.
  • There are still unanswered questions about what else employers can require of workers when it comes to workplace safety.
  • Visit Business Insider’s homepage for more stories.

Employers can legally require employees get a COVID-19 vaccine or ban them from the office, the Equal Employment Opportunity Commission (EEOC) said in a recent guidance.

As the first doses of coronavirus vaccines are given to healthcare workers and other high risk groups, many employees around the country officially have an answer to the question: Can my boss legally require that I get the COVID-19 vaccine?

Pharmaceutical companies Pfizer and Moderna have each said that their vaccine is about 95% effective. American healthcare workers received the first COVID-19 vaccines on Monday, soon after Pfizer became the first candidate to receive emergency authorization in the US from the Food and Drug Administration, shortly followed by Moderna’s vaccine.

Read more: Employers are flooding labor lawyers’ inboxes to ask if they can make a coronavirus vaccine mandatory in the workplace. Here’s the advice 6 lawyers are giving clients.

Business Insider spoke with six labor and employment lawyers about whether workplaces can make coronavirus vaccinations mandatory for their employees.

Can bosses make a coronavirus vaccination mandatory at the workplace?

Workers likely first want to know what exactly their employers can require of them. In short, yes, employers can make vaccines mandatory, Jimmy Robinson, managing shareholder at the L&E firm Ogletree Deakins’s Richmond office, told Business Insider. He also mentioned that there would need to be religious and medical accommodations, with specific requirements varying by state and locale.

Karla Grossenbacher, chair of Seyfarth Shaw’s L&E practice in Washington, DC, said that employers would have to comply with the Americans with Disabilities Act (ADA). The ADA says that employers can require medical exams and vaccinations of employees under certain, specific conditions, like for healthcare workers, or if it poses a “direct threat” to the person if they are exempted, Grossenbacher said.

The EEOC, which enforces civil rights laws against workplace discrimination, has categorized COVID-19 as a direct threat. This designation allows employers to require temperature takes, masks, and social distancing.  The federal agency has clarified that employers can mandate vaccination for employees, saying  “If a vaccine is administered to an employee by an employer for protection against contracting COVID-19, the employer is not seeking information about an individual’s impairments or current health status and, therefore, it is not a medical examination.” Medical examinations, including COVID-19 antibody testing, are not limited by the EEOC.

There are still many questions lawyers don’t yet know how to answer. 

With a limited number of vaccines available, the general public will not be able to get the shots for months. In the meantime, workers have other questions about what employers can ask of them.

Nathaniel Glasser, a partner at Epstein Becker Green, said his clients are asking if they can restrict employees from attending large gatherings, or if employees can be required to come into work if they feel it is unsafe. Thomas Wassel, a partner at the law firm Cullen and Dykman on Long Island, said that in many cases employees do have to come to work, but it depends on specific circumstances.

The Biden administration may also release more guidance or legislation on workplace safety, which could answer some of these questions. Each question also depends on the specifics of the vaccine and the employee’s particular job, so many questions are impossible to answer this early.

Read the original article on Business Insider