We’ve all seen the billboards driving down Arizona highways, “Don’t California My Arizona.” Well, if Congress gets their way, California’s failed labor “reform” legislation will not just be the new standard for Arizona but for the entire country as well.
In 2019, California passed Assembly Bill 5 (AB 5) that, among other things, implemented a rigid labor standard known as the ABC test to determine whether someone should be classified as an independent contractor or a full-time employee. Unfortunately, it doesn’t reflect the ways in which people work today. While freelancers and independent contractors might be able to find ways to meet two of the requirements of the test (the “A” and “C”), the third (the “B”) is nearly impossible to meet, and categorizes many workers as full-time employees whether they want to be or not.
California has borne the brunt of how poorly the ABC test works in practice. Instead of benefitting workers, it has sacrificed their freedom, flexibility, and work opportunities. Just a few examples of the unintended consequences from this calamitous bill: musicians were no longer able to work at after-school children’s programs; freelance authors were capped at the number of articles they were able to write for specific outlets; speech therapists were barred from providing services to school districts without being full-time employees; and countless others.
As a result of these failed policies, many have left the state—often coming to Arizona where flexibility and entrepreneurship are embraced, not regulated. The backlash in California has been so persistent that lawmakers have had to update the law to add dozens of new exceptions on top of the ones they originally included.
Fast forward to 2021 and now Congress wants to adopt this same, outdated labor standard for the whole country in the Protecting the Right to Organize Act (a.k.a., PRO Act). This bill is not new. The 116th Congress introduced the PRO Act in 2019 and just like before it fails to account for the needs and desires of “gig” or independent contract workers.
One of the largest impacts of the PRO Act will be on independent consultants such as ourselves. We have opted for this type of work so we can choose our own schedules, pace, and availability. We have a combined 43 years as independent contractors. If the strict ABC test definition were enacted, many of our clients would decline to hire our businesses because they would not be able to add additional full-time employees, plus those are not roles that we want. This would impact both ourselves and our financial stability, but also the other businesses who rely on the work of our businesses in the broader economy. Instead of flexibility and independence, independent consultants would be forced into rigid definitions better suited to the 19th century than the 21st.
California residents voted last year to exempt some gig workers from the legislature’s AB 5 with the passage of Prop 22 in November. If the PRO Act passes, the rest of the country would be forced into something even Californians have recognized was a bad idea.
The PRO Act is a solution in search of a problem. Independent workers and freelancers are not asking to be full-time employees. When they were reclassified as such in California, they overwhelmingly voted to opt out and create a third way that preserved their independence and flexibility. Let’s heed their example and don’t “California” the rest of the nation.
This article’s authors, Kathy Boltz, Lynne Buck, Jake Poinier and Kathy Visser are all independent contractors living and working in Arizona.