PRO Act, Fed Version of California ‘Gig Worker’ Law, Passes House

LOS ANGELES—The PRO Act, federal legislation that takes the provisions of California’s AB5 law restricting how companies may hire freelance workers and makes them national, took a major step toward becoming law Tuesday when the United States House passed the bill on a mostly party-line vote, 225-206. Five Republicans voted in favor of the bill, whose full name is Protecting the Right to Organize Act, along with all 220 House Democrats. Identical to AB5, the PRO Act includes the so-called “ABC Test” used to determine which workers can be deemed independent contractors, and which must be treated as employees. When AB5 took effect in California at the start of last year, it created alarm within the adult industry, where most performers and crew members work on a freelance basis.  The bill created the most confusion in the live adult performance sector, where the freewheeling system in most strip clubs that allows dancers to leave each night with cash in hand while protecting their own identities was curtailed by the “ABC test.”  According to a report by the news site Vox.com, “Democratic aides” say that the ABC test included in the PRO Act will not impair the ability of freelancers to work, but instead “will simply give them the option to collectively bargain along with regular employees.” Though how such collective bargaining involving independent contractors would work remains unclear. President Joe Biden has endorsed both AB5 and the PRO Act, saying during his presidential campaign that “the ABC test will mean many more workers will get the legal protections and benefits they rightfully should receive.”  Under the three-pronged ABC test, to remain an independent contractor a worker must be “free from the control and direction of the hiring entity in connection with the performance of the work,” as well as performing work “that is outside the usual course of the hiring entity’s business.”  The worker must also be “engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.” The ABC test replaces the more lenient “Borello Test,” under which a worker must prove only that she or he is free from the “control” of an employer — that is, do the workers set their own hours, work from a location of their choice, supply their own equipment and so on? Writing for The Week news magazine, freelance writer Bonnie Kristian said that the PRO Act is “intended to force companies to hire us as employees — with all the benefits, like insurance and vacation time, that entails — rather than as independent contractors. That won't happen. If this legislation passes as-is, it will instead destroy my livelihood by making all my work contracts illegal.” Under California’s AB5 law, freelance writers were initially limited to publishing only 35 articles per year for any given publication. But last September, the state legislature approved a new bill, AB2257, which exempted those writers from the ABC test completely — along with workers in dozens of other industries.  The primary targets of AB5 were rideshare and delivery companies that utilize “gig economy” workers — companies such as Uber, Lyft, DoorDash and others. But in November, California voters approved Proposition 22, which exempted those companies as well, leaving AB5 largely crippled. But if the PRO Act becomes law, the federal legislation would likely supersede those state exemptions. The law faces an uphill battle in the U.S. Senate, however, where it would need 60 votes to overcome a Republican filibuster. Whether Democrats could induce 10 Senate Republicans to support the bill appears to be a longshot. Photo By Speaker of U.S. House of Representatives / Wikimedia Commons