Your freelance business is under attack and the PRO Act is the aggressor!
I hate to be dramatic – and I very rarely publicly discuss anything political.
But, the PRO Act, which recently passed through the House of Representatives, has the power to derail your freelance business. It must NOT pass in the Senate (date of the vote still to be determined but will likely occur later this year).
So, what is the PRO Act?
On the surface, the piece of legislation expands worker rights to unionize. But, there’s much more to it than that.
It contains something called the ABC test, which is a means to distinguish between employees and independent contractors.
The B prong of the test is the most problematic because it says an independent contractor aka freelancer can’t perform the same work that the hiring company aka client focuses on.
For example, let’s say you’re a freelance writer. You’re in the business of publishing content. Under the ABC test (particularly the B prong), you couldn’t freelance for a company that publishes content as its main/sole business model (which covers small blogs all the way up through major media companies). You’d have to be classified as an employee.
And, since most companies don’t want to convert their freelancers to employees — and most freelancers don’t want to be employees — those business relationships would dry up.
The PRO Act could cause you to lose clients — and make it difficult to acquire new ones!
It Happened in California
Unconvinced? In 2019, California pushed through a bill called AB5 in an attempt to better classify workers as employees or independent contractors. The bill was disastrous – and an utter failure.
It was so bad that the state government had to amend the bill with several exemptions. Unfortunately, the patch job happened after California-based freelancers saw their businesses go up in smoke.
And the House clearly didn’t learn from the legislative nightmare in California because the PRO Act doesn’t have any of the same exemptions!
While the Senate is likely to vote NO on the PRO Act, we can’t be sure until it happens. Plus, President Biden has been very outspoken about his support for this and other related bills. He has stated that he wants to make the ABC Test the law of the land. The future of freelancing is therefore uncertain.
So, what should we do?
We must make our voices heard!
Legislation that impacts freelancers should NOT be included in a bill about unionization. The ABC test needs to be removed and replaced with the long-time standard IRS test (which already helps companies classify workers as employees or independent contractors).
I urge you to learn more about the PRO Act and contact your Senators to tell them to vote no. Our Senators need to understand what this legislation would do to millions of freelancers across the nation.
PRO Act resources:
To learn more about the PRO Act, start with these resources:
And, here’s how to contact your Senators:
1.) Go to this website.
2.) Choose your state in the drop-down. Your Senators will appear.
3.) Call them or write them a letter using the information shown. AND/OR
4.) Click “Contact” and fill out the form to email them.
5.) Repeat the process regularly until the vote happens. Be persistent.
Not sure what to say? Take a peek at these templates and scripts for guidance.
If you’re on Facebook, check out the group Fight for Freelancers. Lots of great information is posted there daily.
Please, please, please — share this information with all of your freelancer/self-employed friends. And ask your friends and family to join you in standing up for your right to freelance by contacting their Senators.
Together, we will be heard and acknowledged. We will preserve our American right to earn a living as we see fit!
Learn by listening? Check out this podcast episode about Why the Pro Act is Bad News for Freelancers.