As I headed to LAX after a recent trip to Los Angeles, my Lyft driver insisted that we stop at In-N-Out Burger so that I could enjoy one last California experience. We ate the burgers outside, as planes flew above us. My driver, a professional photographer, works for Lyft to supplement his irregular income. His story is common. Most drivers that Ive encountered in California and elsewhere drive as a side job, while also, say, working in restaurants or selling real estate.
But if Californias state government has its way, driving for Lyft or Uber wont be easy in the future. The passage of Assembly Bill 5 (AB5) aims to make contract workers, like my Lyft driver, regular employees.AB5 is well-intentioned but doesnt account for how the labor market has changed. This will bring higher pay and benefits to retained workers, but it will also increase costs, which means higher prices for customers. And if employers ultimately incur the costs of adding more regular staff, odds are that they will start to mandate when and where employees work, reducing gig-work opportunities.
Under the new law, to be permitted to hire someone as a contractorand not as an employeebusinesses must pass whats known as the ABC test, which involves proving, in court, that the contractor is free from control and direction of the hiring entity, that the contractor supplies similar services to other vendors, and that the work performed falls outside the usual course of the hiring entitys business. My Lyft driver, and many others, would be unable to satisfy those conditions.
AB5 is well-intentioned. Contract work, with its unconventional hours and pay, is risky and unpredictable, with no benefits, and the prospect of instant termination. The law originated in a 2018 lawsuit, Dynamex Superior West v. Superior Court, involving delivery employees at Dynamex. Though the company considered them contractors, they were expected to wear uniforms and supply their own cars. They sued to be recognized as employees and won, and the suit created the ABC test. Within a year, AB5 became law.
But AB5 doesnt account for how the labor market has changed. In an industrial economy, dependence on a single employer made sense, and attaining skills relevant to a single firm proved valuable. Finding other work, after all, could be difficult. But in a knowledge-oriented economy, where technology makes work easier to find and on-the-job skills are more commonly transferable across companies than in the past, independence can suit both employers and employees. Gig works flexibility also makes it valuable as a fallback, offering extra money when people might need it most.Nontraditional work relationships include a host of different arrangements.
In fact, most gig workers in the U.S. dont work full-time in this capacity. Over the past 15 years, the number of full-time contractors has been stable. According to a Federal Reserve Board survey, only 18 percent of Americans perform gig work as their primary source of income. The plurality, or 38 percent, use it to supplement income from their primary job.
Overall, 30 percent of Americans do some form of gig work, and its common across education levels. Though contract work makes up less than ten percent of household income for three-quarters of survey respondents, 45 percent consider it an important part of their income.
The Fed concludes:
The greater subjective value placed on this income may be related to its ability to smooth out unexpected changes in earnings from main jobs even if the actual amount of money earned is relatively small.
Gig works flexibility also makes it valuable as a fallback, offering extra money when people might need it most. Workers of all income levels find it valuable. Its also a helpful option for stay-at-home parents who want to keep a toe in the labor market. Turning gig work into a regular job undermines this value because it removes its most important characteristic: flexibility.
No wonder, then, that workers and employers are pushing back. Freelance journalists are mounting a challenge to AB5 after many lost jobs. Developing technology calls for better regulation of gig work, not effectively eliminating it.Uber and Lyft say that theyll continue to hire drivers as contractors, but they could face legal challenges, as some trucking companies did. The truckers prevailed in court because their business takes them across state lines.
Its true that technology is transforming the labor market, and employee protections have been reduced. But this development calls for better regulation of gig work, not effectively eliminating it. The leading Democratic presidential candidatesJoe Biden, Elizabeth Warren, Pete Buttigieg, and Bernie Sandershave all endorsed a national version of AB5. They should remember that most workers use gig work as a form of insurance. By eliminating contractors, laws like AB5 will increase risk rather than reduce it.
This article is republished from City Journal.
The rest is here:
- For 1st time, Freedom Conference to be held outside Steamboat; organizer blames local COVID-19 restrictions - Steamboat Pilot and Today - July 13th, 2020
- Current crises give cause to consider the meaning of 'freedom' in 2020 - Iowa City Press-Citizen - July 13th, 2020
- Freedom is the cure? - Post Register - July 13th, 2020
- Kahle: Freedom is our brand - Opinion - The Register-Guard - July 13th, 2020
- Kristiine Silinja: "I love exploration, adventures, and freedom. All that comes with a six-string bass" - Guitar World - July 13th, 2020
- Don't let them take our freedom | Letters To The Editor - Uniontown Herald Standard - July 13th, 2020
- The Novels of Tension Between Freedom and Disaster - The New York Review of Books - July 13th, 2020
- 'Optimism of the Will': Palestinian Freedom is Possible Now - Middle East Monitor - July 13th, 2020
- What American freedom means to a refugee from Iraq at a time of protests and pandemic - Chicago Sun-Times - July 13th, 2020
- Suicide of Egyptian activist Sarah Hegazi exposes the 'freedom and violence' of LGBTQ Muslims in exile - The Conversation US - July 13th, 2020
- A Black Alabama hero fights for America and freedom in new novel - AL.com - July 13th, 2020
- The joys of Czech tramping: Hiking with friendship, freedom and fun - The Guardian - July 13th, 2020
- With app bans, is Internet freedom being sacrificed for national security? | The Hindu Parley podcast - The Hindu - July 13th, 2020
- Citizens hold 'freedom drive' in place of parade - Silver City Daily Press and Independent - July 13th, 2020
- Rangila, the ''dancing bear'' rescued from Nepal, celebrates two years of freedom - Outlook India - July 13th, 2020
- Letter to the editor: Freedom comes with responsibilities, so wear a mask - TribLIVE - July 13th, 2020
- Statement in support of OSCE Representative on Freedom of the Media - PEN America - July 12th, 2020
- Celebrate the sounds of freedom | News, Sports, Jobs - Alpena News - July 12th, 2020
- Azerbaijan and Tajikistan block renewal of OSCE media freedom representative - The Shift News - July 12th, 2020
- Opinion: Freedom comes with the burden of responsibility - easternnewmexiconews.com - July 12th, 2020
- Oprah Winfrey and BFF Gayle King Reunite for "Freedom Dinner" After Negative Coronavirus Tests - E! NEWS - July 12th, 2020
- 'Give Me Freedom or Give Me Death': 13 Years Without Trial at Guantanamo, My Hunger Strike Is All I Have Left - Common Dreams - July 12th, 2020
- Congress' decision seen as a slap to freedom of press - The Star Online - July 12th, 2020
- Post-lockdown camping: 'It's a taste of freedom' - The Guardian - July 12th, 2020
- Freedom in Ukraine: Moving in the right direction? - The Ukrainian Weekly - July 12th, 2020
- Healing, Justice, and Freedom, as Defined by #BlackLivesMatter - Greatist - July 12th, 2020
- Survival of Americas experiment depends on how we use freedom - Crux: Covering all things Catholic - July 12th, 2020
- Massive protests in Argentina demand justice and freedom; president Fernandez pledges to end the serial haters - MercoPress - July 12th, 2020
- MLS is officially back and more: Freedom Kicks for 9 July 2020 - Black And Red United - July 12th, 2020
- And When He Came to Himself (Luke 15:17) - July 11th, 2020
- MINISTER'S MOMENT / By REV. WILL WILSON | A Christian perspective on freedom - Kilgore News Herald - July 11th, 2020
- The impact of the health crisis on freedom of expression and media freedom - Report by the Secretary General of the Council of Europe, Marija Pejinovi... - July 11th, 2020
- Suicide of Egyptian activist Sarah Hegazi exposes the 'freedom and violence' of LGBTQ Muslims in exile - The Ridgefield Press - July 11th, 2020
- Freedom Day Bailouts Get Several Men Behind Bars Out Before Father's Day | 90.1 FM WABE - WABE 90.1 FM - June 22nd, 2020
- This Week in Technology + Press Freedom: June 21, 2020 - Reporters Committee for Freedom of the Press - June 22nd, 2020
- The Juneteenth flag is full of symbols. Here's what they mean - CNN - June 22nd, 2020
- We Have to Talk About Liberating Minds: Angela Davis' Quotes on Freedom - AnOther Magazine - June 22nd, 2020
- Journalism Instructor Leading Online Freedom of Information Event - Ole Miss News - June 22nd, 2020
- Dozens gather for freedom march and rally in downtown Columbus - 10TV - June 22nd, 2020
- Justice Thomas concludes that the "freedom of speech" is a Privilege or Immunity under the 14th Amendment - Reason - June 22nd, 2020
- Freedom launches Pilot to simplify teleoperation on third-party robots - TechCrunch - June 22nd, 2020
- Gov. Stitt says Trump rally attendees 'have freedom to stay home' if concerned about contracting COVID-19 - Tulsa World - June 22nd, 2020
- Opinion: The freedom to take a knee - Houston Chronicle - June 22nd, 2020
- Politicized COVID-19 Response Imperils Both Freedom and Safety, States Journal of American Physicians and Surgeons - GlobeNewswire - June 22nd, 2020
- Julian Assange's fianc calls on the Australian government to secure his freedom - World Socialist Web Site - June 22nd, 2020
- 5th Annual Tybee Island Wade-In commemorates fight for freedom - WSAV-TV - June 22nd, 2020
- Pence to visit Texas for 'Freedom' event at megachurch - Monitor - June 22nd, 2020
- COVID-19: Freedom Means That We Can Do Stupid Things, Not That We Have To - Anchorage Press - June 22nd, 2020
- No restrictions on using firearms: India gives soldiers freedom along LAC in extraordinary times - Hindustan Times - June 22nd, 2020
- Aim to Achieve Financial Freedom in the Stock Market With This $30 Bundle - CT Post - June 22nd, 2020
- Freedom is never defined as mob rule | Opinion - nj.com - May 19th, 2020
- American freedom was tug-of-war from the start - York Dispatch - May 19th, 2020
- Finding the balance between safety and freedom in the shadow of COVID-19 - VentureBeat - May 19th, 2020
- In time of quarantine, we must resist Grand Inquisitors view of freedom - Crux: Covering all things Catholic - May 19th, 2020
- Freedom Does Not Mean Being on the Loose - Psychiatric Times - May 19th, 2020
- The van gives me such freedom: Custom conversion gives Eugene woman wheels on which to roam - The Register-Guard - May 19th, 2020
- Freedom is Never Free - The Hudson Reporter - May 19th, 2020
- Germany's flag burning ban is a threat to freedom of expression - Spectator.co.uk - May 19th, 2020
- What will we do with the new freedom to shop and dine? - cleveland.com - May 19th, 2020
- What does freedom mean in this moment? - The Irish Times - May 19th, 2020
- Event captures memories of Freedom Riders' heroic journey between Anniston and Birmingham - Bham Now - May 19th, 2020
- Are Contact Tracing Apps the Key to Lockdown Freedom? - Redbrick - May 19th, 2020
- Hundreds expected to gather for local Faith & Freedom Rally - KDRV - May 19th, 2020
- Freedom of information laws 'have failed to keep pace with public services' - Aberdeen Evening Express - May 19th, 2020
- Captain Tom Moore receives Freedom award during City of London's first 'virtual' ceremony - FE News - May 11th, 2020
- Boris Johnson's roadmap to ease lockdown will start with more freedom to exercise and back-to-work moves from Wednesday - Telegraph.co.uk - May 11th, 2020
- God alone is the source of liberty and freedom - Akron Beacon Journal - May 11th, 2020
- 'Deadly Dictatorship': How Rodrigo Duterte Has Attacked Freedom of the Media in Latest Closure of Main Broadcaster - The National Interest - May 11th, 2020
- Conjure Women is a tale of slavery and its aftermath - The Economist - May 11th, 2020
- Freedom Haven Emergency Shelter and Transitional Living Home - - KUSI - May 11th, 2020
- Freedom Festival events postponed to 2021, firework show will be held - Deseret News - May 11th, 2020
- Granite State confined at home find freedom and calm in the garden - The Union Leader - May 11th, 2020
- MSNBC contributor: Americans 'freedom-obsessed' to point 'we're blind to other types of threats' | TheHill - The Hill - May 11th, 2020
- Faith and freedom of choice are key ingredients for parenting - The New Indian Express - May 11th, 2020
- Just after Elon Musk denounced coronavirus lockdowns as infringements of freedom, research shows Britons are too scared to leave their homes anyway -... - May 11th, 2020
- Another Freedom Square resident has died of COVID-19 in Pinellas - Tampa Bay Times - May 11th, 2020
- Celebrating freedom in the same garden 75 years on - Jersey Evening Post - May 11th, 2020
- Freedom Is An Issue That Stirs Voters - America's 1st Freedom - May 11th, 2020
- How You Can Advance the Cause of Reason and Freedom - New Ideal - May 11th, 2020
- As Spaniards got their first real taste of freedom this weekend, hundreds of them got arrested and thousands were fined - MarketWatch - May 11th, 2020