It’s time to map out a middle ground for the self-employed

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The United States is currently facing a historically tight labor market with millions of open jobs across the economy. There are simply more jobs — in retail, manufacturing, logistics, and more — than those interested in traditional work relationships where employees are tied to some version of a 40-hour workweek with fixed benefits. Self-employment, on the other hand, has never been more popular. At a time when all types of employees have maximum choice to choose the different terms of their working relationship, many are opting for independent working relationships.

Why is that? This is what we know. We know from poll after poll that most people who engage in independent work do so of their own free will and are satisfied with this working relationship. We know that many self-employed workers see the opportunity to build their own businesses as their life’s work and as a pathway for these entrepreneurs to build businesses that span generations. We also know that some individuals are looking for quick gigs to make as much money as possible in between other activities, such as school or care, to combat historic inflation and/or to get a temporary influx of cash into their households. .

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Whatever their reason for seeking independent employment, the US must embrace policies that support these individuals and their choices. Unfortunately, too often the opposite approach is taken.

Legislation such as AB-5 in California is a good example of a policy that prevents individuals from participating in a rapidly modernizing economy that offers flexibility. This law aims to classify most, if not all, employees as employees, regardless of their expressed wishes. And everyone has witnessed the uproar and negativity surrounding the bill since its inception. There have been over 100 exemptions from AB-5, a successful Prop 22 campaign where voters rejected the law by a margin of nearly 2 to 1, and recent outcry from truck drivers angered at what this new employment classification means for their livelihoods. AB-5 was a policy that was haphazardly pushed by a small group of special interests with little regard for its full impact on the stakeholders they sought to protect.

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Fortunately, there is a better way forward: the Flexibility and Choice of Workers Act (WFCA). Recently, Representatives Henry Cuellar (D-Texas), Elise Stefanik (RN.Y.), and Michelle Steel (R-Calif.) introduced the WFCA, a first-of-its-kind, two-pronged approach to protecting individuals’ assets. to sign up for the employment relationships that work best for them, whether that’s as independent contractors, freelancers, and handymen. Their approach charts a middle ground between the status quo, which limits support and protection for independent workers, and radical efforts like AB5 and the PRO Act, which politicizes workers’ preferences.

In particular, WFCA guarantees the right of individuals to accept and reject employment opportunities and pursue opportunities with multiple entities, while at the same time ensuring that a conscious and voluntary working relationship is forged with other business entities. And most importantly, the WFCA creates pathways for independent workers to receive non-traditional benefits as non-employees of entities they contract with.

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Some opponents of the WFCA take the misguided view that all employees want and should be traditional workers, leading to bad policy proposals like AB-5. Rather than push through programs supported by a small group of interests, policymakers should proactively think about how best to support and improve the modern work experience of millions of self-employed workers.

The Coalition for Workforce Innovation supports the WFCA and commends the two-pronged work of Cuellar, Stefanik and Steel. All lawmakers need to look closely and see what the bill aims to achieve: a modern approach that helps workers do what they want while offering more protection than what currently exists under the law.

Camille Olson is an advisor to the Coalition for Workforce Innovation, a coalition of technology companies, employee advocacy, retail, logistics and service companies advocating for modernized human resources policies in the US. She is also a partner at Seyfarth. Evan Armstrong is the President of the Coalition for Workforce Innovation and Vice President of Workforce at the Retail Industry Leaders Association (RILA).

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