Posts tagged ABC test
9th Circuit panel will hear Uber/Postmates case on AB5
December 22, 2023 // The decision handed down by a three-judge panel in March was notable primarily for its reasoning that Uber and Postmates had been denied equal protection of the law in the process that led to the California approval of AB5, state legislation that required companies that hire independent contractors to reclassify them as employees. Equal protection of the law was the only claim by Uber and Postmates that the appellate panel backed; it supported the lower court rejection of other arguments. The panel cited the statements of then-Assemblywoman Lorena Gonzalez, now a state labor leader but the key driver in turning AB5 into law, as evidence that the move to more tightly define when a worker can legitimately be considered an independent contractor was an effort targeted at gig drivers like those at Uber.
Lawyers will square off on California trucking’s latest AB5 exemption request
November 12, 2023 // AB5 is a state law that seeks to define independent contractors through the ABC test. For trucking, the B prong in the ABC test is a particular burden, as it defines an independent contractor as one who “performs work that is outside the usual course of the hiring entity’s business.” A trucking company hiring an independent owner-operator to move freight could be challenged under the B prong. The various participants in the case have filed briefs in recent weeks laying out their arguments that will be reiterated in court Monday. The last year has seen revised complaints from CTA and OOIDA, widening the scope of their arguments. Those revisions and the state responses have provided extensive documentation on the positions each side is taking in the case, which is formally known as CTA v. Bonta, after Rob Bonta, the state’s attorney general. (The original defendant in the case was then-Attorney General Xavier Becerra, now the Biden administration’s secretary of Health and Human Services.)
AB5 needlessly reclassifies genuine independent contractors, OOIDA says
November 8, 2023 // OOIDA, which is serving as an intervenor in a case against the state’s worker classification law, told the court in its Oct. 27 reply brief that AB5 needlessly causes genuine independent contractors to be reclassified as employees. “AB5 discriminates against and imposes undue burdens on interstate commerce in violation of the dormant Commerce Clause, and the disparate treatment of AB5’s business-to-business and construction exemptions violates the U.S. and California constitutions’ equal protection clauses,” OOIDA wrote.
Michigan Legislature Is Mulling An ABC Test
October 13, 2023 // The local Chamber of Commerce warns there will be no exemptions for Michigan’s independent workers (unlike California’s AB5 which exempted over 100 occupations). The Great Lake State currently employs the Internal Revenue Service (IRS) 20-factor test, which is more amenable and receptive to flexible work arrangements. HB 4391, on the other hand, would create an independent contractor disclosure notice to “self-report alleged misclassification issues” to accompany HB 4390. This timing isn’t coincidental. Michigan repealed its right-to-work law earlier this year. As I noted at IWF back in April, here’s the immediate fallout from repealing right-to-work:
Will Biden Labor Nominee Julie Su Suffocate the Gig Economy?
October 13, 2023 // Su, and other progressives like Federal Trade Commissioner Lina Khan, want to force a 20th century model of a heavily regulated and controlled labor market on the 21st century gig economy. They also want to impose 20th century style trade unionism, replete with mandatory union dues that (coincidentally I am sure) can in part be used to support progressive candidates and causes in the gig workforce. This is one reason why a bipartisan majority of the Senate is right to oppose Su’s nomination, and why President Biden was wrong to nominate her as Labor Secretary, and certainly wrong to defy the will of the Senate by keeping her as acting Secretary for an indefinite period of time. Biden should pick a new nominee. While no one nominated by Biden will support a free-market labor policy, the nominee should at least understand that massive federal regulations on the labor markets and compulsory unionism are relics that do not fit the economy of the future.
Opinion Scherer: Government scrutiny of ‘gig workers’ Is misplaced
August 23, 2023 // The Labor Department published a Notice of Proposed Rulemaking on the subject last year, but a final rule isn’t expected until October. Legal experts rightly criticized the proposed rule as an “ABC test in sheep’s clothing.” By this, they mean the rule seeks to mimic a 2018 California Supreme Court test known as the ABC Test, which made it more difficult for companies to hire workers as independent contractors. While it is impossible to know what Labor’s final rule will look like, final rules don’t typically differ significantly from proposed rules, making the prospect of an impartial final rule unlikely. This is terrible news for millions of American independent contractors who overwhelmingly like and support their working arrangements. For instance, a 2020 Morning Consult survey of independent contractors found that 71 percent believed “the freedom of being an independent contractor outweighs the benefits of being an employee.” A more recent 2022 study by MBO Partners found that 76 percent of independent contractors were “very satisfied with independent workers.” In addition, 84 percent said they were “happier” working independently, with 80 percent reporting that independent contracting was better for their health. These views are consistent with Bureau of Labor Statistics data showing that “79 percent of independent contractors preferred their arrangement over a traditional job.”
7-Eleven, Franchisees Renew Battle Over What Defines a Worker
July 26, 2023 // The franchisees say a lower court wrongly concluded that they don’t perform services for the company and refused to apply Massachusetts’ “ABC test” for determining whether those who run the stores are employees or independent contractors, contradicting a 2022 state high court answer to a certified question earlier in the suit’s judicial odyssey. The c-store chain urges the US Court of Appeals for the First Circuit to leave the lower court’s decision in place. The lawsuit, 7-Eleven’s lawyers said in their appellate brief, is an attempt to turn the state’s independent contractor law “into something it was never intended to be—a tool for business owners, like Plaintiffs, to recover as ‘damages’ three times the value of their business’s operating expenses, including their payroll and the fees they pay for their franchise rights.”
Commentary: How Much Longer Will Democrats Support the PRO Act?
June 29, 2023 // When the act was introduced in 2019 and 2021, I voted against it both times. Members should not be fooled by the so-called pro-worker rhetoric that has accompanied the PRO Act. You can be pro-worker without hitching your wagon to a poisonous bill that advances an ideological attack on small business owners. So next time your sink backs up or your chimney needs sweeping, think of the PRO Act and those who are pushing it.
In Advance of Senate HELP Markup, AFP Leads Coalition Urging Senators to Reject PRO Act
June 21, 2023 // Instead of supporting these bills that prioritize top-down government mandates and the preferences of union leadership over the needs of America’s workers, we call on lawmakers to defend and expand choice and flexibility for workers so that they are best able to address the challenges of and maximize opportunities in the 21st century economy. We strongly urge you to reject the Protecting the Right to Organize Act, the Healthy Families Act, and the Paycheck Fairness Act, and we look forward to working with you to pursue a path forward that puts workers, not special interests, first.
California Independent Contractor Law Faces Withering Attacks
June 16, 2023 //