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AB5 may ease caps for writers, photographers; more gig-law changes coming

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The author of AB5, California’s new gig-work law, said Thursday that she’ll seek amendments that remove some restrictions on freelance journalists and photographers, and is eyeing further changes for musicians, small businesses and others, as well as an assistance fund to help small nonprofit arts groups comply.

“Based on dozens of meetings with freelance journalists & photographers, we have submitted language to legislative counsel that we hope to have available next week to put into AB1850 which will cut out the 35 submission cap & instead more clearly define freelancer journalism,” tweeted Assemblywoman Lorena Gonzalez, D-San Diego. She also said she will make more prominent the bill’s exemptions for businesses serving other businesses and specify that freelance writers can take advantage of them.

Writers and photographers filed suit over the bill in December, saying AB5 was an unconstitutional restraint of free speech and the media. They particularly objected to its “irrational and arbitrary” limit of 35 submissions per year, per client.

The suit was filed by the libertarian Pacific Legal Foundation on behalf of the American Society of Journalists and Authors and the National Press Photographers Association.

“We’re glad to hear that Gonzalez is willing to revise the bill to protect freelance journalists from the devastation we’ve suffered this year,” San Diego freelance writer Randy Dotinga, board member and former president of the American Society of Journalists and Authors, who spearheaded the lawsuit, said in an email. “We look forward to seeing the exact bill language. We also look forward to our hearing in federal court on March 9.”

“We have not seen the bill language, but I hope that the revised law will no longer treat journalists as second-class freelancers,” Pacific Legal Foundation attorney Jim Manley said in a statement. Removing any submission caps and limits on video recording would be a step in the right direction. We look forward to reviewing the bill.”

Gonzalez said she’s calling for $20 million in the state budget to supply grants to small community nonprofit arts organizations “that make a good-faith effort to comply” with the new law. Many small theater, dance and music companies have said they operate on shoestring budgets and simply could not afford to hire all their performers and backstage crews as employees.

For instance, Solo Opera in Concord and Walnut Creek said it would cost $10,000 to comply with AB5 for its upcoming summer production of “Scalia/Ginsburg,” previously budgeted at $60,000. The money is for attorney fees for new contracts, payroll costs, workers compensation, insurance and more

“Being a small nonprofit, this is a huge hardship on us,” said founder and artistic director Sylvia Amorino, who volunteers full time to run the company. The five-member board decided to come up with the money out of their own pockets. Amorino raised $1,000 via a birthday fundraiser on Facebook.

However, she said, “if the law doesn’t change, we will have to go dark or take a hiatus. The costs would be unsustainable for us.”

She said she’s cautiously optimistic about the proposed grants but concerned that it might be “money we have to fight for (with) thousands of small companies competing.”

Gonzalez filed placeholder legislation, AB1850, early this year, saying she would use it to clarify AB5.

“We plan to address the unique situation regarding musicians in the next round of amendments by March,” she tweeted Thursday. Musicians — the profession most associated with the word gig — had protested that under AB5 even garage bands would have to form employment structures, and that being hired as employees for one-night-stand engagements would be prohibitive.

The bill currently exempts fine artists, a term that Gonzalez tweeted would be better defined after input from the state Employment Development Department.

“This is just a piece of the clarifications you will see in AB1850 & additional resources and relief for small businesses that are complying with this new law,” she wrote on Twitter. “We plan to have a few more formal announcements next week.”

However, she tweeted, the amendments do not signal an end to the bill — and do not mean capitulation to the $110 million ballot initiative being pushed by Uber, Lyft, DoorDash and other companies to keep their drivers and couriers as independent contractors.

“I do believe in AB5 and will fight any attempts to repeal it,” Gonzalez tweeted. “I will fight Uber’s attempt to exempt themselves through initiative.”

Carolyn Said is a San Francisco Chronicle staff writer. Email: csaid@sfchronicle.com Twitter: @csaid

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As Congress scrutinizes gig worker rules, small-business owners need to know the basics – The Philadelphia Inquirer

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Uber’s UK ruling could have implications for gig economy startups

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Former Uber drivers Yaseen Aslam and James Farrar first brought their case against Uber in 2016
(Carl Court/Getty Images)

The UK’s Supreme Court has rejected Uber‘s appeal against an earlier ruling that said its drivers must be classified as workers, a result that may have a significant impact on other gig economy companies.

The decision—which cannot be appealed—means thousands of UK Uber drivers cannot qualify as being self-employed, entitling them to both minimum wage and holiday pay. The ridehailing company could now face paying substantial compensation to its drivers.

The ruling, which criticized Uber for sidestepping UK labor laws to withhold benefits, could influence other battles between gig workers and the companies that hire them. Earlier this month, the Independent Workers’ Union of Great Britain appealed against a court decision preventing riders for food delivery startup Deliveroo from engaging in collective bargaining due to their self-employed status. Deliveroo, which is backed by investors including Durable Capital Partners and Amazon, is looking to go public this year.

“Employees should benefit from improved rights; however, employers are likely to face increased costs of labor and disruption to their business models, which have proven to achieve rapid scale with gig workers,” said PitchBook analyst Nalin Patel. “The ruling may also now set a precedent in the UK and force other gig economy startups that utilize the self-employed contractor model to rethink how they operate in the region moving forward.”

Former Uber drivers James Farrar and Yaseen Aslam originally won their tribunal against Uber in 2016. Uber appealed the decision, but it was upheld in 2017, and again in 2018 by the High Court.

“This ruling will fundamentally re-order the gig economy and bring an end to rife exploitation of workers by means of algorithmic and contract trickery,” said Farrar, who is also a general secretary with the App Drivers and Couriers Union. “Uber drivers are cruelly sold a false dream of endless flexibility and entrepreneurial freedom.”

In a statement, Uber’s regional general manager for Northern and Eastern Europe, Jamie Heywood,  said the court decision was focused on a “small number of drivers” who used the app in 2016. Since then, he said the company had made changes to its business,  providing free insurance in case of sickness or injury. He added: “We are committed to doing more and will now consult with every active driver across the UK to understand the changes they want to see.”

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The future is now for gig-based entrepreneurship – San Gabriel Valley Tribune

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With Californian Kamala Harris as vice president, it’s clear the new Biden administration is taking its cues from the once-Golden State on labor policy.

In one of its first acts in office, the Biden Administration placed a regulatory freeze on a Department of Labor regulation enacted in the waning days of the prior administration relating to independent contractors.  The rule, according to labor and employment law firm Fisher Phillips, “aims to make it easier for businesses to classify workers as independent contractors.”

It’s unlikely this rule to give more workers freedom to be their own boss and set their own schedules will survive in a Biden administration that was heavily reliant upon labor unions for money and manpower to win the 2020 campaign.

Meanwhile, House Democrats recently re-introduced the controversial PRO Act in Congress, which “seeks to reduce the use of the independent contractor classification by companies such as Uber,” according to CNBC.

Both of these efforts followed the lead of California’s liberal legislative majority, which two years ago enacted the controversial Assembly Bill 5 to severely restrict the ability of Californians to work as independent contractors.  Their goal is to increase union membership and dues and force people to work in traditional, 9-to-5, union jobs that are relics of the past.

Doubling down on AB 5-type restrictions at the national level – which may be the Biden administration’s goal with the nomination of Julie Su, California’s chief AB 5 enforcer, as deputy Secretary of Labor – would be a tremendous mistake.  It would threaten innovation and hurt the ability of Americans who have lost their jobs to put food on the table during a global pandemic.

As documented in the new Pacific Research Institute study, “The Small Business Gig,” Americans are increasingly working in the gig economy.  They don’t want government – whether in Sacramento or Washington, DC – dictating how they can earn a living.

A 2018 Gallup survey found that 36 percent of U.S. workers have some sort of a gig worker arrangement.  Whether renting out an extra room to earn cash to pay the mortgage or using an app to earn a living on an alternate schedule, the gig economy is increasing opportunities for Americans to become entrepreneurs, while providing customers with lower cost services.

Many in California state government see the gig economy as exploitative and disruptive.  But data from the ADP Research Institute shows that 70 percent of gig workers are independent workers by choice.  Gig Economy Data Hub research found that more than two-thirds of gig economy workers are satisfied with their current work arrangement.

Government shouldn’t pick winners and losers in the economy.  New restrictions on the gig economy, like those proposed in Congress, will limit people’s freedom to become entrepreneurs while institutionalizing the old way of doing work.

Instead of adopting regulations at the federal level that 58 percent of Californians – Democrats, Republicans, and independents alike – rejected when they passed Proposition 22 in November, the Biden administration and Congress should take the opposite approach and enact market-based policies to encourage entrepreneurship and innovation.

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