New York Floats a Crackdown on Independent Workers
Like California’s ruinous A.B. 5, the proposal would greatly harm freelance employment.
A bill before the New York state Senate seeks to reclassify many independent contractors as employees, advancing a standard similar to that of California's ruinous Assembly Bill 5, or A.B. 5. The proposed S2052 would implement the "ABC Test," which classifies workers as employees unless the (a) worker is free from the control of the hiring entity, (b) the work performed is outside the hiring entity's bailiwick, and (c) the worker is "customarily engaged" in the type of work he is hired to do.
S2052's sponsor memo extols that the bill gives "the most basic human rights of American workers to a voice on their jobs and a role in shaping their futures." However, individual agency in "shaping their futures" is precisely what the bill would quash.
The government can't turn every contractor into an employee, so making it impossible for employers to hire many independent contractors will simply make many independent contractors unemployed in their chosen careers. Anti-freelance politicians, backed by unions, tout the benefits of "employee" status, but such benefits accrue to a few at the expense of many others. Following the passage of A.B. 5 in California, for instance, sports network SB Nation opted to terminate roughly 200 freelancers, reportedly to be replaced by just 20 full- and part-time staffers. Those 20 people may have received more in pay and benefits, but 180 other people lost income.
"New York presumes—like every other government entity and Democrats in general presume—that independent contractors are inherently, unavoidably exploited and that they all yearn to be bona-fide employees when that's not the case at all," Ike Brannon, a senior fellow at the Jack Kemp Foundation, tells Reason. "Our survey in 2019 of 1,000 or so independent contractors in the midwest found that few desired to be actually employed." Indeed, in 2021, Pew Research Center found that nearly 80 percent of gig workers "rate their experiences in these jobs positively."
Gig work is popular throughout the economy. In 2022, an estimated 60 million individuals—roughly 39 percent of the American work force—engaged in freelancing. Supermajorities cited benefits like financial gain (83 percent) and schedule flexibility (73 percent), according to freelancing platform Upwork. Consequently, crackdowns on independent work endanger the livelihoods of a diverse cohort of workers. "While media coverage of the issue tends to focus on platform-based gig-workers," Walter Olson, a senior fellow at the Cato Institute, wrote, "workers hurt by AB 5 included many tutors, performers in music and theater, plumbers, nurse practitioners, writers, photographers, contract software developers, and many others, notably owner-operators and other independent truckers."
A statutory exemption in New York's worker-classification regime could enable a court challenge to S2052, says Jim Manley, an attorney at the Pacific Legal Foundation. "Newspaper carriers are not employees under current New York law—explicitly," Manley tells Reason. "And so what that means is if you're delivering a newspaper to someone's house, you can be an independent contractor, but if you're delivering a political pamphlet, if you're delivering commercial materials, you can't be an independent contractor under the ABC Test," he explains, adding that differently regulating various forms of speech creates "a content-based distinction."
Too many legislators in New York, California, and Washington, D.C., wish to deploy state power to mold the work force to fit their personal preferences. Such attempts are entirely unmoored from economics and individuals' own desires, however, and they rob citizens of the right to freely pursue happiness and success.