California Threatens $1 Trillion Gig Economy With New Law

California Threatens $1 Trillion Gig Economy With New Law

California Threatens $1 Trillion Gig Economy With New Law

Imperfect new rules are nothing to fear for those seeking to do genuine independent work.

Our CEO and Founder, John Ryan takes a closer look.

California, arguably the jurisdiction of technological and social developments that the rest of the world most often looks to for guidance, or at least interesting ideas, has recently passed into law a pretty significant change surrounding independent contract workers.

In essence, Assembly Bill 5 (AB5), seeks to stop the practice of businesses misclassifying those who are by all intents and purposes employees, as independent contractors. 

To assist in the process of making these judgments the bill has organised parameters into the ABC test. The test puts the burden of proof on the employer to prove that a worker is an independent contractor by satisfying the following:

(A) the worker is free from the company’s control 

(B) the worker performs work that isn’t central to the company’s business and 

(C) the worker has an independent business, trade or occupation in that industry.

Objectively observing the law changes, one could effectively argue two positions; 

  1. that those seeking to become employees will be relieved to be finally recognised appropriately, or; 
  2. that those who genuinely enjoy the independence of gig economy work will be displeased at the impact on their freedom to choose, and mobility between jobs.

Gigable would adopt a middle-ground here, and here’s why: 

The foundation of the gig economy is such, and always has been, that individuals seeking to make an independent living, or indeed earn an additional income independent of their primary work, should be empowered to do so in a way that offers total job mobility. 

In other words, the genuine independence that comes with choosing to work as say, a delivery driver in a local takeaway on a Thursday night, and then choosing to pick up a shift in a warehouse with a packaging firm on a Saturday.

The legs to this table of independence are, in our view; 

  1. Independent Choice; 
  2. Unrestricted Opportunity; 
  3. Meritocracy.

Freelancers enjoy the freedom that choosing when and with whom to work offers them. They take advantage of the potential for unrestricted opportunities to earn more, particularly the kind that digital platforms can provide, and, because they are arguably some of society’s harder-working and more self-motivated workers, they want to be recognised for this in a genuine meritocracy.

When looked at through this lens, the ABC test may take the legs from under this table, and with more than 75% of the 57 million American freelancers doing so out of choice, there is potential here for a lot of unhappy people. 

However, it is also true to say that work in the gig economy has come in for a lot of criticism as a result of some businesses seemingly taking advantage of the ideals of the gig economy and squashing would-be employees into a Freelancer role. The numbers and stats don’t necessarily support this view, and we feel that a lot of the classification choice should be one that is in the hands of the worker, not of an imperfect test or out-dated systems.

Even under these new tests, Freelancers on the Gigable platform retain their independence, with our model being an example of how choice, opportunity and meritocracy can exist in a transparent way that benefits those wishing to earn an extra income in the gig economy.

Read the Forbes article here:

#iamgigable #independence #futureofwork #gigeconomy

Fancy chatting about Gigable?

I would be more than happy to chat with you about the benefits of Gigable for your business – John