California's AB 5 is causing massive headaches in its attempt to limit the "gig economy." Phillip Sprincin writes:
Last year California passed a new law, known generally as AB5, designed to classify independent contractors as full employees, a status that brings associated protections under California law. The law was designed to go after Uber and Lyft, whose business model depends on drivers working as independent contractors, but it was too broad in scope, threatening to drag in workers and business far from the tech-enabled “gig work” economy.
AB5 took effect on January 1, and it’s already causing trouble. A limit on the number of articles that freelance writers could produce for one publication resulted in layoffs for some California journalists and a First Amendment lawsuit from others. Workers in more than 135 occupations claim that losing contractor status hurts them, while independent theater and arts groups are facing thousands of dollars in costs they can’t afford because they must now treat staff as employees. Lorena Gonzalez, the assemblywoman who wrote AB5, has introduced another law to remove the article cap for writers and address the status of musicians. A sign of poor legislation is the need to rewrite it immediately after it takes effect.
[Phillip Sprincin, “AB5 Backfire,” City Journal, February 11]
