WASHINGTON (July 31, 2019) – The 9th U.S. Circuit Court of Appeals has asked the California Supreme Court to review whether the Dynamex decision applies retroactively. This issue has been greatly contested and is the source of ongoing controversy within the legislature. If the matter goes unresolved, it will bring elements of the California economy that are dependent on independent contractors, far beyond Uber and Lyft, to their knees. People reliant on such work, who are often the most tenuously engaged in the workforce, are the most likely to suffer.
In a new policy short, R Street Director of Commercial Freedom Jarrett Dieterle and TechFreedom Vice President of Policy Ian Adams find that California stands on the brink of doing away with almost all contractor arrangements. The future of work requires greater flexibility, and so-called “protections” that eliminate jobs are anything but, the authors claim. History has shown that what begins in California often becomes national policy, and interest in adopting the “ABC” classification test, which forces many independent contractors to be designated as employees, has grown dramatically since the Dynamex decision.
The authors conclude, “AB 5 legislation, which redefines what it means to be an independent contractor in California, and the employment classification test it creates restricts the freedom of workers, diminishes their economic opportunity and flatly undermines their own employment preferences—it is the most noxious legislative proposal currently pending in Sacramento, and possibly nationally.”