The PRO Act is a great law with a fatal flaw, but luckily, the fix is easy

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I invited Kim Kavin, a freelancer-rights activist well-versed in the issue, to talk about why the current “ABC” test is so deadly to freelancers, and how simply switching to the IRS test would resolve that community’s concerns. So with all that, I’m passing the mike.

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By Kim Kavin

That was just one of numerous tweets that self-described Democrats and Progressives blasted out en masse March 8, after U.S. Rep. Elise Stefanik of New York — a Republican and staunch defender of President Trump — introduced an amendment to remove language called the ABC Test from the Protecting the Right to Organize Act.

Here’s another, from a friend of mine in California who relentlessly supported Joe Biden in his run for the presidency:

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A day later, the U.S. House of Representatives defied constituents like these — refusing even to give Stefanik’s amendment a fair vote on the floor — and passed the PRO Act with the ABC Test still in it. An op-ed immediately appeared on NBC Think with the title, “I backed Biden and the Democrats. But their pro-union bill could kill my career.” And a new hashtag was proposed, #MomsAgainstTheProAct, just as the Facebook group I co-lead to stop the ABC Test from getting into federal law saw an influx of hundreds of new members.

Here’s what the Facebook group’s new demographic breakdown looked like the day after the House vote, reflecting the type of Americans now terrified and coalescing to stop the PRO Act from advancing any further with the ABC Test still in it (you tell me which political party’s base this data best represents):

Democrats have made a dramatic miscalculation by adding the ABC Test to the PRO Act, and by ignoring what one congressional aide told us were thousands of calls they received ahead of the House vote begging them to remove the ABC Test from the bill.

The party in power, if it wants to stay in power, now needs to withdraw the ABC Test before bringing the PRO Act to the floor in the Senate, or let the bill die there altogether. And Democrats need to state publicly, and loudly, that they no longer favor the ABC Test being in federal law or regulations of any kind.

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I wrote in detail about this restrictive ABC Test and its perils for DailyKos a little over a year ago. That was after California had enacted it into law, and after my home state of New Jersey had tried to pass a copycat version of California’s ABC Test bill. The New Jersey effort failed in the face of what a Democrat and 20-year veteran of the Garden State’s Legislature called an “amazing amount of opposition.” At the time, I wrote for DailyKos that then-candidate Biden was among those campaigning on a plan to take this ABC Test nationwide, despite the chaos it had already caused for so many Californians and the outcry it had fueled in New Jersey. 

I also wrote, based on the test runs we’d just experienced in these bright blue states, that the sheer number of Americans who could be unfairly harmed by this ABC Test “would be enough to swing a whole election.” Millions of Americans unfairly caught in this ABC Test’s net, I wrote, would see what’s happening as “an assault on their chosen way of life.”

Here we are 14 months later, with the election cycle for the next session of Congress set to ramp up by the end of this year. And here’s what was all over Twitter this past week, the day after the PRO Act passed the House with the ABC Test still in it:

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Perhaps now, we’re all ready to have a serious conversation about the need to remove this ABC Test from the PRO Act, and to keep it out of all areas of federal law.

You can read all the ins and outs of this ABC Test in my original piece on the topic for DailyKos, but suffice it to say that the most career-killing part of the test is B-prong, which states that a person cannot legally do work as an independent contractor if she’s in the same line of business as the company paying her. This B-prong has ensnared Californians in hundreds of professions such as actors, architects, DJs, therapists, musicians, and the list goes on. The damage has been so extensive that more than 100 professions have already been exempted, with more still seeking exemptions or relief in federal court. The federal PRO Act has zero exemptions, willfully refusing to learn from California’s mistakes. 

This “same line of business” provision of the ABC Test hits freelance journalists like me, who sell articles to magazines and newspapers. It hits respiratory therapists taking on day work at hospitals that need help with Covid-19 surges. It hits real estate appraisers who do assessments for property companies. It hits so many different types of professions that it’s mind-boggling. It hits shopping mall Santas and birthday party magicians, financial advisers and franchise owners, and a heck of a lot of the truckers who have been keeping our supply chains running before and during the pandemic. According to the California Trucking Association, there are 350,000 owner-operator truckers nationwide.

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If this ABC Test gets into multiple areas of federal law the way Democrats have pledged to enact it, tens of millions of these and other Americans would no longer be able to work the way they’re working now. Companies would either have to make them employees or end their contracts altogether in the face of fines and penalties. Proponents of this ABC Test say the former will happen, and that after these Americans become newly minted employees who are legally eligible for unionization, they’ll help to rebuild America’s dying unions. The reality of what we just witnessed for more than a year in California was that companies chose to end contracts. They did not create traditional jobs as a result of the legislation.

To be clear: California just taught us all that these stringent ABC Test laws mean independent contractors lose their clients and careers. Precious few employee-status jobs are created, and zero new unions are formed.

This ABC Test is not only bad policy, but it’s also bad politics, especially when it comes to women voters at a time when women are reeling economically from the recession. As long as this ABC Test remains in the PRO Act, it can easily be used to slam Democrats everywhere. It is a direct attack on the livelihoods of a huge swath of the party’s base who choose to be their own bosses while raising kids, caring for elderly parents, or simply trying to escape the glass ceiling and sexual harassment in traditional workplaces.

According to a major 2019 study by the IRS and U.S. Treasury, the number of family breadwinners who are women doing independent contractor work is up 90% since 2001. Another 2019 study showed that 73% of these self-employed women say they have a better work-life balance; 68% earn the same or more money than in a traditional job; 59% say they have less stress; and 57% say they’re healthier.

These are the women outraged at Democrats who just voted for a plan to eliminate their choice of independent contractor work by passing the PRO Act with the ABC Test still in it. These are the women suggesting hashtags like #MomsAgainstTheProAct and cheering a Trump Republican whose beliefs otherwise repulse them.

The latest talking point among PRO Act supporters is that this response is nothing more than a bunch of hysteria (we women just adore that word) and that the PRO Act isn’t really the same as California’s law. They say that while California lawmakers added the ABC Test to multiple areas of law, the PRO Act only adds it to one area: federal labor law.

But the Biden plan clearly states that the PRO Act is only step one in making the ABC Test the basis for all labor, employment and tax law, and that he will work with Congress to make this full plan a reality like in the ridiculously named bill, the Worker Flexibility and Small Business Protection Act. As Biden put it, “states like California have already paved the way.” He’s now putting the whole country on a path that follows California’s disastrous ABC Test legislation.

What’s happening right now all across America, with the House passage of the PRO Act and the ABC Test still in the bill, is independent contractors going through the same psychological exercise that those of us in California and New Jersey endured a little more than a year ago. This vote taught a lot of independent contractors — especially those who are Democratic women — that what’s happening is intentional. They are realizing, after calling their lawmakers to explain the problem with the PRO Act as it’s currently written, that the people they elected into power aren’t listening to them. They are feeling hunted instead of protected by the party they just threw their hearts and souls into supporting.

There is still time to make amends for this betrayal. Senate Majority Leader Chuck Schumer said in a broadcast to freelancers six months ago (start watching around minute 26) that he would work to fix the problems we have with the ABC Test in the PRO Act. Schumer failed to make good on that promise before the House passed the PRO Act this month. Both he and Biden now must tell America’s contractors that they are ready to listen, and that they will remove the ABC Test from the PRO Act and keep it out of federal law altogether.

And here’s the good news: Removing the ABC Test in favor of different language can be an easy fix. The ABC Test is not the only language in existing law that can be used to determine who is an independent contractor. We already have the far more nuanced IRS Test available as a replacement. That’s a test modern independent contractors can pass, because it can tell the difference between an exploited factory worker and a six-figure graphic artist.

Don’t like the IRS Test? OK, well, there’s a lot of political wrangling right now about an even newer test that the U.S. Department of Labor put forward at the end of the Trump administration, but in terms of the big-picture issue at hand, these alternatives make clear that there are ways to write rules that protect Americans who prefer independent contractor work. 

People who choose self-employment deserve protection just as much as misclassified workers do. The law should work for us all. If it’s only Republicans like Elise Stefanik who recognize the need to stand up for the majority of independent contractors wishing to remain self-employed, then they are the lawmakers who will hear more and more independent contractors cheering them on. From all walks of life. All across the country. For as long as it takes to get this problem of people’s livelihoods resolved.





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