A new bill circulating through Congress might wreak havoc on the livelihoods of many freelancers and independent contractors if it becomes law.
What is the PRO Act?
The bill is called the Protecting the Right to Organize (PRO) Act, and on the surface, it simply looks like a bill designed to allow workers the right to unionize.
According to the AFL-CIO (who favors the legislation), labor laws are outdated and call this bill “a landmark worker empowerment, civil rights and economic stimulus legislation, and an essential part of any plan to build back better from the COVID-19 pandemic and recession.”
However, a closer examination of the bill reveals provisions that could be harmful to freelancers.
For example, it contains what is called the ABC Test, a test used to differentiate between employees and independent contractors. This test was adapted originally with AB5, legislation created and passed in California in 2019, with similar provisions.
– (A) The work is done without the direction and control of the employer. – (B) The work is performed outside the usual course of the employer’s business. – (C) The work is done by someone who has their own, independent business or trade doing that kind of work.
At stake for freelancers is Part B of this test because it essentially says that a freelancer or independent contractor cannot perform the same work the company or client does. For example, a freelance event planner is in the business of planning events.
Under part B of this test, these event planners would not be allowed to freelance for a company that produces events—they would be required to be an employee—something that most independent contractors have little interest in.