- Many freelancers are concerned about the PRO Act because of the inclusion of the “ABC” test.
- Yet this test only reclassifies workers under labor law — they would still be independent contractors.
- Strengthening the right to organize would help marginalized workers. The PRO Act must be passed.
- Lauren Crosby Medlicott is a freelance journalist in Wales.
- This is an opinion column. The thoughts expressed are those of the author.
- See more stories on Insider’s business page.
Conversations in the freelance world have been heated after the PRO Act passed in the House of Representatives in March. With the bill’s upcoming discussion in the Senate, freelancers and contractors are scurrying to voice their support or disagreement with the largest pro-union bill in the US in more than 80 years.
The Protecting the Right to Organize Act was introduced as a solution toward leveling the playing field that is said to be “unfairly tilted toward big business and management.” The law would provide protections to make it easier for workers to organize and increase the power of unions to bargain with employers for better working conditions, pay, and worker protections.
Misconceptions about the PRO Act
Those in opposition to the PRO Act, such as Fight For Freelancers, warn that the bill is a repeat of the California Assembly Bill 5, or AB5, which passed in 2019 and used the ABC test to define employment under tax, employment, and labor law. While it was intended to combat the misclassification of workers, many complained it had disastrous effects on thousands of independent workers who were either forced to be hired as an employee or lost work from employers who didn’t want to offer the benefits associated with employment. In light of its damage, independent workers are voicing their concerns over the PRO Act, which uses the same ABC test to determine classification.
In response to concerns regarding the PRO Act, members from various freelance guilds, collectives, and unions are collectively supporting and advocating for the passage of the act. The Freelancer’s Union says that the PRO Act would “allow freelancers to share information about their pay with each other, to come together to suggest minimum payments for their work, and to speak out collectively against harassment, abuse, and other types of mistreatment. They would be able to call for the boycott of companies that mistreat their freelancers – an act that is currently illegal under federal antitrust law.”
Supporters of the act firmly disagree that the PRO Act will have similar implications as the AB5 based on the amendment passed with the bill, which states: “The amendments made under this Act shall not be construed to affect the definitions of ”employer” or ”employee” under the laws of any State that govern the wages, work hours, workers’ compensation, or unemployment insurance of employees.”
Essentially, if a worker meets the criteria of an employee following an ABC test, they are classified as an employee only under the National Labor Relations Act (NLRA), which governs unionization. As an employee under labor law, the worker can now unionize and bargain with an employer without threat of firing or detracted pay. In other words, independent contractors will remain independent contractors, just with the additional new rights conferred by the NLRA.
Strengthening the right to unionize
The ability to unionize and collectively bargain is an incentive for the nearly 60 million Americans who said that they would join a union if it wasn’t for the employers and states who prevent it. But unionization is a matter of urgency for many vulnerable workers who are currently being misclassified as independent contractors.
In the restaurant, construction, trucking, and painting industries, employers often hire workers as independent contractors to avoid payment of minimum wages, overtime pay, benefits, social security payments, unemployment insurance, and legal protections. State-level studies show that between 10% and 20% of employers misclassify at least one worker as an independent contractor. Those workers, often from marginalized communities, are deprived of the rights they deserve, robbing them of their earned wage, insurance, benefits, and job security.
The PRO Act may not address every issue concerning these vulnerable misclassified workers – after all, it would only affect their employment under labor law – but it would begin the process of strengthening the rights of workers to unionize. It would restore confidence to stand up to employers, without fear of the repercussions of dissent. While the PRO Act may not be the complete fix of the misclassification of workers, it is a start to giving them a voice to link arms and broadcast their concerns.
David Weil wrote for the Harvard Business Review on his solutions to the injustice of misclassification when he was working at the Wage and Hour Division of the US Department of Labor. The solutions included investigations of businesses who showed competitive advantage due to misclassification, working with state agencies to fight misclassification by sharing practices of problematic industries and employers, and organization of enforcement on companies that misclassified workers.
There is work ahead to protect misclassified workers from exploitation and the PRO Act is a step in the direction.