Posts tagged Mercatus Center
‘Independent Contractor’ Rule Latest Dumpster Fire Exported From California
January 31, 2024 // One of those infamous policies and the havoc it’s bound to wreak has gone national, thanks to labor department rules issued by the Biden administration. A 339-page Department of Labor rule – you can always count on the federal government to keep it pithy – would make it much harder to be an independent contractor or freelance worker in America. Created to replace a simpler Trump-era rule, it’s modeled on AB5, a disastrous 2019 California law that made independent contracting and freelance work so hard to do that it effectively outlawed it in the Golden State.
Op-Ed: Labor Department stuck in 1930s with rule against independent contractors
January 23, 2024 // With a national rule, however, few of those escape options are possible. Freelancers are unlikely to flee the country, and there is no such thing as a national ballot measure. The department has only just finalized the rule, so revisions are unlikely unless there is a change in control of the executive or legislature this November. Independent contractors face an extremely uncertain future. The reason why the rule is likely to be such a problem is because it is based on a vision of what the workplace should look like from a century ago, when large corporations dominated. Large corporations made sense when it was harder to be nimble as a business. Nobel Prize winner Ronald Coase explained the reason we have corporations at all is because of the presence of what are called transaction costs. If I have a business idea that requires the services of someone else, I face those costs. If the business idea requires someone with advanced mathematical calculation skills I don’t have, I can either contract with someone who has those skills to do the work every time I need it, or I can hire them as an employee instead and have them always available.
New Research Quantifies Harms To Independent Contractors Of California’s AB5
January 23, 2024 // Despite AB5 proponents’ claims that the law would increase full-time employment and offer benefits and protections, the researchers found “robust evidence that AB5 is significantly associated with a decline in self-employment and a decline in overall employment.” · AB5 reduced the level of self-employment by 6.7 percentage points to 28%. · AB5 reduced the level of overall employment by 7.3 percentage points to 14%. · The researchers did not find significant evidence that AB5 increased W-2 employment.
California’s Attack on Gig Work Predictably Drove Workers Out of Jobs
January 19, 2024 // Last week, the DOL announced a new set of rules for determining whether a worker is an employee or an independent contractor. Like with California's A.B. 5, those proposed federal rules are meant to crack down on what the government sees as a deliberate effort to misclassify workers as contractors—which can change, among other things, the benefits that an employer is obligated to pay. Most gig workers and independent contractors are content with their more flexible, less structured employment arrangements—so in some sense, these governmental efforts seem to be trying to save workers from their own choices.
Rep. Kevin Kiley Fights for Freelancers Against Julie Su Nom in First Workforce Protection Subcomittee Hearing
April 21, 2023 // Through the PRO Act, DOL rulemaking, and installing those who will do their bidding atop federal government agencies, the establishment Democratic Party, in lockstep with the Big Labor lobby hopes to force tens of millions of Americans out of freelancing and independent contracting and into “employee” status, which would allow the unions to focus on organizing new sectors in the face of dwindling membership. Rep. Kiley has fought against these efforts every step of the way, first in the California State Assembly and now in Congress, and called the hearing to highlight just how destructive the Biden/Su agenda will be to all Americans, and not just Californians, and has called Su “the architect and lead enforcer of AB-5.”
Op-ed: FTC on the Gig Economy: The Glass is Almost Empty
October 12, 2022 // The FTC does, of course, have a legitimate role to play in challenging unfair methods of competition and unfair acts or practices that undermine consumer welfare wherever they arise, including in the gig economy. But it does a disservice by focusing merely on supposed negative aspects of the gig economy and conjuring up a gig-specific “parade of horribles” worthy of close commission scrutiny and enforcement action. Many of the “horribles” cited may not even be “bads,” and many of them are, in any event, beyond the proper legal scope of FTC inquiry. There are other federal agencies (for example, the National Labor Relations Board) whose statutes may prove applicable to certain problems noted in the gig statement. In other cases, statutory changes may be required to address certain problems noted in the statement (assuming they actually are problems). The FTC, and its fellow enforcement agencies, should keep in mind, of course, that they are not Congress, and wishing for legal authority to deal with problems does not create it (something the federal judiciary fully understands). In short, the negative atmospherics that permeate the gig statement are unnecessary and counterproductive; if anything, they are likely to convince at least some judges that the FTC is not the dispassionate finder of fact and enforcer of law that it claims to be. In particular, the judiciary is unlikely to be impressed by the FTC’s apparent effort to insert itself into questions that lie far beyond its statutory mandate.
Labor Relations Radio, Ep 29—Mercatus Center’s Michael Farren On Unions, & Free Market Labor Policy
July 14, 2022 // In this episode of Labor Relations Radio, Dr. Farren discussed a “blue sky” vision of how unions could prosper by getting rid of “Unions’ Original Sin: Exclusive Representation” and competing in a free market workplace, as well as independent contractors and the problems with the PRO Act. A Pro-Union Vision for the 21st Century and Beyond
OPINION JEDYNAK: Helping Women Thrive Post-COVID
March 27, 2022 // As our nation recovers from COVID-19 and sees a return to normalcy, it is important to support women and ensure we all have meaningful career choices and affordable childcare and can be financially secure against rising inflation. Congress’ current proposals would reduce the choices available to women and hinder our ability to use our talents in the labor force. We know best how to care for our family and professional lives — not the government. Americans should reject these heavy-handed measures in favor of promoting freedom and opportunity.