Democrats have proposed a bill that would supposedly strengthen unions while also putting independent contractors around the country out of business. On Feb 4, Sen. Patty Murray (D-WA), Senate Majority Leader Chuck Schumer (D-NY), Rep. Bobby Scott (D-VA) and House Speaker Nancy Pelosi (D-CA) reintroduced the Protecting the Right to Organize (PRO) Act in the US House of Representatives.
At least two Republicans support the bill, Reps. Chris Smith (NJ) and Brian Fitzpatrick (PA). Unfortunately, the bill proposes sweeping changes to federal labor law that will obliterate the current economy and eradicate right-to-work labor laws in 27 states.
Democrats and other advocates claim the bill will strengthen unions. "The bill would advance union organization and collective bargaining rights by authorizing the National Labor Relations Board to levy fines against employers who violate workers' rights and unilaterally overturn a workplace election. It also would ensure that workers can participate in secondary boycotts and collect "fair share" fees."
Democrats support the bill as do radical pro-labor union organizations like the Democratic Socialists of America.
The bill also has the support of Richard Trumka, the President of the AFL-CIO. Trumpka warned Democrat senators in 2020 that if they did not vote to pass the PRO Act, the AFL-CIO would not longer donate to their campaigns.
However, the bill comes with major downsides to independent contractors. The PRO Act would expand the definition of "employee," and adopt the California "ABC" test to exclude most workers from exempt independent contractor status. The ABC employment test is the fundamental problem with the bill. According to the California Labor & Workforce Development Agency, the ABC test is as follows:
A. The worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact;
B. The worker performs work that is outside the usual course of the hiring entity's business; and
C. The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.
A bevy of politicians and organizations have come out against the bill, pointing out how it would adversely affect the gig economy—independent contractors and other workers, nationwide.
The Foundation for Economic Education (FEE) called the PRO Act "a case study in unintended consequences." The US Chamber of Commerce is also opposed to it, along with the Union Veterans Council is also against the PRO Act.
At Forbes, author Erik Sherman called the bill "labor's amateur hour" and described just why it's bad for independent contracts. He said, "[T]rue independent contractors don't generally wish employee status. They have multiple clients and prefer the flexibility and freedom.
They also tend to make more money, and so can afford to get their own benefits. In many cases, family issues, illness, disability, care-giving responsibilities, or other reasons make traditional employment impossible."
The Associated Builders and Contractors oppose the bill as well. "Under this legislation, the 87 percent of construction workers who choose not to join a union could be forced to pay union dues as a condition of employment," said ABC President and CEO Mike Bellaman in a recent statement.
"This undemocratic bill would strip workers of entrepreneurial opportunities to freelance as independent contractors, denying them the freedom to earn a living on their own terms and pursue the American dream. The PRO Act would do anything but 'Build Back Better.'"
The gig economy has grown 15 percent in the last decade—that's 6 million people—and particularly since COVID. It is particularly conducive to certain industries, like Uber, the drive-sharing company, and people who need or enjoy flexible employment, like working parents, elderly people who need a side income, or young people balancing school and work.
While the bill may pass in the House, it is unlikely to pass in the Senate without further support from Republicans.