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AB 5 is Such a Disaster in California, Pelosi and Congressional Democrats Push National Law to Destroy Gig Economy

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Because California’s AB 5 by Assemblywoman Lorena Gonzalez hasn’t done enough damage already to independent contractors and freelance workers in hundreds of different industries, Congressional Democrats and Speaker Nancy Pelosi are championing their own national version:  The Protecting the Right to Organize Act or PROAct, on behalf of the AFL-CIO.

Following the State of the Union, Pelosi announced Wednesday on Twitter: “The most important table in America is the kitchen table. Tomorrow, we will pass the #PROAct to protect Americans’ rights to join a union and raise the purchasing power of families across America. #ForThePeople.

Assembly Bill 5 by former labor leader Assemblywoman Lorena Gonzalez (D-San Diego), has already significantly limited Californians’ ability to work as independent contractors and freelancers. It was revealed during Senate debate in September that the AFL-CIO wrote AB 5.

Assemblywoman Gonzalez said in December, “These were never good jobs,” referring to freelance journalists, as justification for AB 5.

California freelance journalists are losing jobs en masse because AB 5 also randomly limits freelance writers and photographers to 35 submissions annually per media outlet. Members of the entertainment industry are seeing jobs cancelled in droves. And even ADA protected industries such as court reporters, captioners, and sign language interpreters, a majority of whom prefer the independence and flexibility of deciding when and where to work, are seeing their ability to work as independent contractors and freelancers in jeopardy, as California Globe reported.

The law, signed by Gov. Gavin Newsom, broadly codified the newest definition of an employee, established in 2018 in the California Supreme Court’s decision in Dynamex Operations West, Inc. v. Superior Court of Los Angeles, which dealt a blow to independent contractors. The Court ruled that the Dynamex delivery drivers were employees, rejecting its own prior test for determining whether workers should be classified as either employees or independent contractors,” Forbes reported.

According to many legal analysts, what the Court did was legislate from the bench by adopting a new rule for the narrow purpose of interpreting California’s Industrial Welfare Commission’s wage orders.

New York Democrats are trying to adopt their own version as well.

As California Globe reported recently, there are 56.7 million freelance workers currently enjoying life as independent contractors in America.

Assemblywoman Gonzalez and California’s Democrat lawmakers claim to care about workers, but only if they agree to unionize. They claim that the rideshare and app-based gig workers are being exploited by Uber, Lyft, Doordash and other app based businesses.

And despite AB 5 going through the legislative committee process, and hundreds of gig workers, business owners and independent contractors warning lawmakers that the bill would destroy many more jobs than just the gig economy app based businesses, they passed the law anyway.

Editorial boards throughout the state, including the Orange County RegisterSan Diego Union-TribuneSacramento Bee, and San Jose Mercury News said AB 5 would endanger the newspaper industry.

Gonzalez was warned AB 5 could destroy California’s entire Gig economy if passed and signed into law.

“In fact, 66 percent of Uber and Lyft drivers would prefer to remain independent contractors,” the Federalist reported. “The truth that lawmakers don’t want to admit is that gig workers willingly trade certain benefits for what they see as better benefits, and that the nature of work has moved away from the union model, and it’s not going back. Freelancers are de facto small business owners who run themselves as a company.”

Exemptions From AB 5 and Possible Fixes

In January, California Globe reported “The Superior Court of California in Los Angeles ruled earlier this week that independent truckers are exempt from AB 5.”

A new bill has been proposed to exempt freelance journalists from the independent contractor redefining AB 5 law in the California Senate. Senate Bill 868, authored by Senator Patricia Bates (R-Laguna Niguel), would also end the post AB 5 rule of limiting freelance journalists to 35 articles a year per publication.

A federal lawsuit by two drivers and Uber and Postmates seeks declaratory, injunctive, and other relief to determine that AB 5 is unconstitutional. Their lawsuit claims AB 5 violates the Equal Protection and Due Process Clauses of the Fourteenth Amendment to the United States Constitution, the Ninth Amendment to the United States Constitution, and the Contracts Clause of Article I of the United States Constitution, as well as the Equal Protection Clause, Inalienable Rights Clause, Due Process Clause, Baby Ninth Amendment, and Contracts Clause of the California Constitution.

The PRO Act, H.R. 2474, would preempt state labor laws, overrule three Supreme Court decisions, and transform the National Labor Relations Board (NLRB) into a punitive one. The PRO Act would:

  • Require workers to pay dues to a union
  • Change the definition of joint employment in order to ease union organizing;
  • Amend the definition of employee to increase the pool of employees eligible for unionization;
  • Impose government-mandated arbitration to dictate employment terms in first negotiations
  • Promote card-check organizing, a process that forces union representation on workers without a secret-ballot election.

With the many state and federal legal challenges to AB 5, for Pelosi and House Democrats to carry the water for the AFL-CIO on a national level, willing to kill 56 million freelance and independent contractor jobs, does not bode well in an election year.

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‘Uber for evictions:’ Startup raising eyebrows for listing tenant removal gig jobs | WETM

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(NEXSTAR) – The newest option for flexible gig work doesn’t involve driving your neighbors around or delivering food to their homes, it requires removing them and their stuff for failing to pay the rent.

The website for the startup Civvl advertises process server and eviction crew work on a flexible schedule across all 50 states.

The company website describes the work as the “fastest growing money making gig due to COVID-19.”

According to Civvl’s site, the work involves posting eviction notices, serving papers and assisting with foreclosure cleanouts on behalf of banks, landlords and property managers.

While it may seem like a cruel parody of the gig economy in the age of COVID-19, Vice reporter Ashwin Rodrigues dug into the business and says it appears to legitimate based on its national advertising effort and links to slightly more established gig sites. Rodrigues was unsuccessful in attempts to get a response from the company founders.

“Seizing on a pandemic-driven nosedive in employment and huge uptick in number-of-people-who-can’t-pay-their-rent, Civvl aims to make it easy for landlords to hire process servers and eviction agents as gig workers,” wrote Rodrigues, describing the company as, “Uber, but for evicting people.”

An estimated 22 million people lost their jobs in the early days of the pandemic, and while some of those people have been rehired, many have been lost for good. With government agencies and facing unexpected deficits and stimulus efforts gridlocked, it’s likely that the economic fallout will be felt for months to come.

Renters fearing eviction should look at protections instituted at both the state and federal level.

On September 1st, the Centers for Disease Control and Prevention issued a moratorium on evictions that covered roughly 40 million Americans at risk of losing their residences. In order to be covered, the renters are required to sign a document declaring that they don’t make more than $99,000 annually or $198,000 if filing jointly, and that they would likely become homeless if not receiving protections.

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Startup Civvl Blends Gig Economy With Evictions

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The world of startups can sometimes teeter dangerously close to self-parody. For years now, “Uber, but for ____” has worked as shorthand for hundreds, if not thousands, of upstart tech companies. Over the summer, an app allowing swimming pool owners to rent out their pools by the hour got plenty of coverage; a year earlier, that’s the kind of thing that might have popped up in a satirical novel or television show.

Where do we go from here? A new article at Vice offers one suggestion: a startup called Civvl. As author Ashwin Rodrigues describes it, Civvl is “essentially, Uber, but for evicting people.” As apps go, that sounds like something that would’ve been cut from Sorry to Bother You for being a little too on-the-nose.

The Vice article chronicles Civvl’s growth: it’s been posting ads on Craigslist for work all over the country, citing the pandemic and the damage it’s done to the nation’s economy as an explanation for why its services are in demand. “There is plenty of work due to the dismal economy,” one ad states. Among the gigs offered: process servers and furniture movers.

The article goes into even more detail about Civvl’s origins, including the fact that it’s part of a larger gig economy-based company called OnQall — and that people who have downloaded the app have posted angry reviews about being charged a $35 fee to use it. A startup charging people money to find work evicting other people sounds like the stuff of satire; instead, it’s just another sign of 2020 being 2020.

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Code on Social Security, 2020, lays down gig and platform worker benefits

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In a first, the central government has recognised the gig economy gig workers, platform workers, and aggregators under a wide-ranging proposed labour law that it introduced in Lok Sabha on Saturday. The Code on Social Security, 2020, empowers the central government to formulate social security schemes for gig workers and platform workers around life and disability cover, accident insurance, health and maternity benefits, old age protection, creche, and other benefits the government may determine as necessary.

So far, gig workers have not fallen under any legislation and are not entitled to social security schemes. Companies that rely on gig workers, such as Zomato, Swiggy, Ola, and others, consider such workers as independent contractors, and not employees, and hence leave them out of any social security benefits.

The new code said that social security schemes can be can be fully or partially funded by the government, by aggregators, in part by the state government, or funded by CSR, or “any other source”. Aggregators will have to contribute between 1-2% of their annual turnover, excluding taxes or cess payable to the central government, as contribution to social security funds for gig and platform workers. The aggregator’s contribution will not exceed 5% of the amount payable to gig workers and platform workers.

The bill was introduced in Lok Sabha amidst opposition from Congress MPs Manish Tewari and Shashi Tharoor.

How the code defines gig workers, platform workers, and aggregators

A gig worker is a person who works or participates in a work arrangement and earns from such activity “outside of traditional employer-employee relationship”. Separately, the bill also recognises “platform work”, also a work arrangement outside traditional employer-employee relationship “organisations or individuals use an online platform to access other organisations or individuals to solve specific problems or to provide specific services or any such other activities which may be notified by the Central Government, in exchange for payment”. A “platform worker” is a person engaged in or undertaking platform work.

An aggregator is a digital intermediary or market place for a buyer/user of a service to connect with the seller/service provider. The bill classifies aggregators into the following kinds:

  1. Ride-sharing services
  2. Food and grocery delivery services
  3. Logistic services
  4. e-Market place (both market place and inventory model) for wholesale/retail sale of goods and/or services (B2B/B2C)
  5. Professional services provider
  6. Healthcare
  7. Travel and hospitality
  8. Content and media services
  9. Any other goods and service provider platform

Central govt will lay down scheme specifics

The government will also provide for how the scheme would be administered, what the role of aggregators would be, and the agencies for implementing the scheme, and so on. The government will notify when aggregators have to start contributing.

  • Power to exempt aggregators: The central government can exempt an aggregator or a class of aggregators from contributing funds to social security subject to certain conditions. An aggregator having more than one business shall be treated as a separate business entity or aggregator. [Section 114].

Additionally, the central government will provide for the interest rate payable by aggregators in case of delayed payments or failure to contribute to the social security fund. [Section 114]

Toll free centre: The “appropriate Government” “may” set up a toll free call centre or helpline to give information about social security schemes for unorganised workers, gig workers, and platform workers. The centre will also help with processing registrations for gig workers and platform workers, and help enroll them in the social security schemes. [Section 112]

Government also to establish social security fund

Apart from letting the government form schemes [under Section 114], the bill also provides that the central government establish a social security fund for unorganised workers, gig workers, and platform workers [under Section 141]. For gig and platform workers, the funding can come fully or partially funded from the central the government, from aggregators, in part from state government, or from CSR, or “any other source” (as was mentioned above). It can also be made up of the composition of the offences under the bill.

Social security means “the measures of protection afforded to employees, unorganised workers, gig workers and platform workers to ensure access to health care and to provide income security, particularly in cases of old age, unemployment, sickness,invalidity, work injury, maternity or loss of a breadwinner by means of rights conferred on them and schemes framed, under this Code”.

Scheme under ESIC: The central government can also frame a scheme for gig workers and platform workers, and their family members for benefits admissible under the Employees State Insurance Corporation (ESIC). The government will have to specify the contribution, user charges, scale of benefits, and eligibility criteria in the scheme.

National Social Security Board to be formed, will administer, monitor schemes

A National Social Security Board will be formed by the central government, that will give recommendations on formulating schemes for gig workers and platform workers (and for unorganised workers). It will also monitor the schemes, and advise the centre on issues that arise out of the code’s administration. It will review the state-level record keeping and review the expenditure of the fund and account. The labour minister and labour secretary will serve as chairperson and vice-chairperson.

  • Out of the 40 nominated members (by the centre), 19 will be government officers, including from central government ministries and departments, and from state governments. There will be 21 members 7 representatives each from unorganised sector employers, unorganised sector workers, and eminent persons from civil society [Section 6].

This will also be the board for welfare of gig workers and platform workers. Provided while “such Board serves the purposes of welfare of, or matters relating to, gig workers and platform workers”, some of the members will be replaced by [under Section 114] :

  • 5 representatives each of aggregators, and gig workers and platform workers, nominated by the central government
  • Experts nominated by the central government
  • Five representatives of state governments in rotation
  • Joint secretary in the Labour ministry to serve as member secretary

It’s unclear whether there will be two separate National Social Security Boards, one for unorganised workers [Section 6], and another for gig workers and platform workers [Section 114]. It is more also possible that the same board will have different members, when addressing gig and platform workers.

Mandatory registration with Aadhaar

To avail benefits, every gig worker and platform worker has to register for a unique number, “in such form along with  such documents including Aadhaar number as may be prescribed by the Central Government”. This comes with the pre-condition that gig and platforms workers seeking registration are above 16 years of age and has submitted a self-declaration “containing such information as may be prescribed by the Central Government” [Section 113].

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