Tens of millions of Americans earn a living working not as an actual employee of a particular company but rather as an independent contractor, freelancer, or “gig worker” that typically enjoy greater flexibility to work how and when they want and to provide their services for one or more businesses, if they so choose.
President Joe Biden wants to end all of that, though, with a proposed Labor Department rule that would force millions of those workers to be reclassified as actual employees of a particular company, according to small business advocate and entrepreneur Carol Roth for TheBlaze.
In doing so, he threatens to negatively impact roughly half of the nation’s economy by potentially forcing independent workers into jobs they don’t necessarily want and by imposing more costs and regulations on employers and small businesses that can’t be afforded or will be passed along to consumers.
At issue here is a proposed rule by the Labor Department that purportedly seeks to clarify the classifications of employees and independent contractors under the existing regulations of the Fair Labor Standards Act.
Interestingly enough, as an aside, the Biden administration appears to actually be abiding by the Administrative Procedure Act that it so often runs afoul of by posting notice of the proposed rule with an opportunity for public comment instead of just altering the rules behind closed doors with executive action or an internal policy memo.
The proposed rule appears to be similar in nature to a 2020 California law known as AB5 — which has since been amended with numerous exceptions to the onerous requirements — that also sought to force businesses and workers to reclassify independent contractors, freelancers, and gig workers as actual employees.
It also bears similarities, at least in terms of the forced reclassification of some workers, to a decidedly anti-business and pro-unions piece of Democratic legislation known as the PRO Act that is currently sitting idle in Congress.
Less freedom for workers
The problem with this forced reclassification, at least concerning the estimated 57.3 million American workers who aren’t “employees,” is that it infringes upon the freedom of those workers to be flexible with their working hours or locations or who they choose to provide services for.
It is also a problem for businesses, too, particularly small ones, as it increases their burden by imposing a variety of regulatory requirements ranging from wages and hours worked to insurance and benefits packages, to say nothing of other requirements like paid leave, social security, unemployment, and workers compensation, among others.
“It makes it incredibly challenging, if not impossible, for small businesses to take on employees and compete in the marketplace. So, not only would putting this rule in place take away more economic freedom from gig workers, it would also kill more small businesses,” Roth asserted.
Biden doesn’t actually care
“As a supposed champion for competition and with a supply-constrained labor force, it would make sense for Biden and his administration to make it easier to hire more people and take on more labor, not erect additional barriers,” Roth wrote of the proposed rule.
“But, of course, Biden and his progressive cronies don’t actually seem to care about that,” she concluded. “They want to give more power to the unions and to big businesses that will support their efforts, consolidating more wealth and power for them, instead of creating opportunities for all, especially the working and middle classes and small business owners.”