“Thank you, California.” So read the headline on a blog post at SB Nation announcing that the sports-blogging network would comply with a new California law imposing excessive burdens on firms that utilize the work of freelance writers or photographers. But the headline’s unqualified expression of gratitude toward Golden State lawmakers was not evident in the body of the piece, which confessed a “bittersweet” note of regret that the statute forces the site to cancel a number of existing agreements with contractors. Some full-time writers with SB Nation’s parent company, Vox Media, were thrilled by the new law virtually outlawing “unpaid or lowly paid” freelance employment. The reform was hailed by Vox as “a victory for workers everywhere.” The people who lost their jobs had more mixed emotions.
This law was designed to remedy the conditions that have led to a rise in the number of minimally compensated writers whose job is to churn out content, whatever the quality. But the law doesn’t address the financial pressures on media firms that led to those conditions in the first place. Indeed, California’s beneficent social engineers have forced hundreds of local media freelancers onto the unemployment lines. They might be somewhat consoled by the fact that they are not alone. The California law—AB 5—takes dead aim at the so-called “gig economy,” which has become an epithet to describe the abundance of new choices available to Americans who want to translate their existing resources into capital.
Though the law exempts dozens of well-connected professions from its requirements—including doctors, accountants, stockbrokers, and fishermen—it singles out younger professionals and low-skilled independent contractors. And while its proponents insist they are only forcing exploitative firms to extend the benefits of full employment to more residents, the law’s practical effect is to compel businesses to deduct payroll taxes from contributor fees—thus, making freelance labor less attractive.
You’ve probably heard about more consternation over this law from the writers it has displaced because, well, they are writers. You’ve not heard as much from the law’s true targets: Californians who generate income from part-time work with ride-hailing firms like Uber and Lyft. Even though it won’t go into effect until next year, California-based Uber drivers have already reported drastic decreases in their share of “surge” bonus compensation. Some drivers have attempted to work with existing transportation unions to lobby their employers for more comprehensive employment status as a result of the legislature’s meddling. And increasing the rolls of unionized labor is, of course, the entire point of AB5.
California is hardly alone in the effort to protect livery unions from the competition represented by ride-sharing services. For years, municipalities across the country have been imposing legal burdens on these innovative services under the auspices of protecting workers and patrons alike. But some American cities, like Seattle, make no pretense about safety in their efforts to compel freelance drivers to become dues-paying union members.
Of course, livery unions aren’t the only beneficiaries of these high-profile political efforts to preserve their economic status. So, too, are hospitality unions. Cities across the country are moving to aggressively regulate “short-term rentals,” which have exploded in popularity amid the rise of home-sharing services like Airbnb. Not all municipal efforts to impose restrictions on the permissive conduct encouraged by short-term rental apps are unjustified. But, as McGill University School of Urban Planning Professor David Wachsmuth observed, the chief objective of regulation-happy lawmakers is to compel these and other firms to “collect the taxes to kind of level the playing field with hotels.”
In 2018, just 10.5 percent of all Americans were members of a labor union. The trend away from labor unions accelerated amid Republican-led legislative efforts to decouple employment from compulsory unionization. In concert with the Supreme Court’s 2018 decision declaring the practice of compelling non-union employees in traditionally unionized sectors to pay membership dues to organizations in which they did not belong, organized labor’s political clout is at a nadir.
Among left-leaning journalists for whom unionization is an unalloyed good, whether the unionized want it or not, there are few downsides to the Democrat-led efforts to increase the purchasing power of beleaguered labor organizations. They and they alone know what’s best for the American worker. But the American workers who lose the choice, mobility, and income presented by freelance employment would probably beg to differ.