As written, Assembly Bill 5, the so-called “gig work bill” sponsored by Assemblywoman Lorena Gonzalez, D-San Diego, would have a devastating economic impact on countless California residents and businesses. It would be especially harmful for many (if not most) of our state’s newspapers, especially in smaller communities that rely so heavily on local journalism for their news.
This much is certain: AB5 is going to pass. It’s already sailed through the assembly on a party-line 59-15 vote, and is certain to pass the Democrat-controlled state senate next month. From there, it’ll just be a Gov. Gavin Newsom-signature away from becoming law.
But first, changes can, and must, be made. If not, the result will be economic chaos for many businesses as 2 million independent contractors are transformed overnight from independent contractors to employees.
The bill is based on the California Supreme Court’s Dynamex decision, which means companies must pass an “ABC” test to determine if a person is an independent contractor or not. Specifically, contractors must be free from company control; perform work not central to the company’s business; and, have an independent business in their industry.
In other words, you can pretty much forget about businesses being able to pass that test in a majority of cases. And the economic impact will be devastating.
We all know independent contract workers and we don’t disagree that many are deserving of employee status. But this bill goes too far, taking that decision out of the hands of thousands of contractors who enjoy the freedom offered by non-employee status.
Our industry, already reeling from years of declining ad revenue and skyrocketing production costs, would be among those hardest hit. There’s no other way to say it — this bill, as written, would put many newspapers out of business, with those in smaller communities being especially impacted.
Sharon DiMauro, a retired publisher from Mendocino County, once won a statewide “A newspaper is … ” contest with the words “A newspaper is … the closest anyone will ever get to holding democracy in their hands.” This bill threatens to rip that piece of democracy right out of our grip.
The people who deliver our newspapers are independent contractors. For most, it’s a supplemental source of income. Some are students and many are retired people looking to make a few extra dollars every month. They contract with us for the routes; if they’re unable to fill the routes on a given day, they hire somebody who can.
Delivering the paper is their business, operated on their terms. And many are delivering multiple newspapers on their routes.
The financial impact of those drivers becoming employees would be more than our industry could bear. Opportunities would be lost, eliminating much-needed supplemental income for the drivers who like the freedom of being their own bosses.
Assemblyman James Gallagher (R-Yuba City), one of the “no” votes on AB5, spared no words in assessing the bill’s overall impact.
“It’s a bad bill. AB5 and the Dynamex decision are poised to completely upturn the way people work in California,” Gallagher said. “The flexibility, efficiency and benefits to workers will be eliminated. This situation allows power brokers in Sacramento to arbitrarily pick winners and losers — and that’s never a good thing. From truckers to franchise owners, many industries will be impacted.”
Fortunately, there’s still time for amendments. The California Newspaper Publishers Association is seeking a newspaper carrier exception, along with an amendment allowing newspapers to continue to use freelancers — the loss of which would have a devastating impact on our ability to report local news and events.
We recognize the need for many independent contractors to earn employee status. As written, this bill casts far too wide of a net and will end up driving too many businesses either out of state or out of operation.
Please join us in contacting your state representatives and party leaders to urge Gonzalez to add the CNPA amendment protecting the right of newspaper drivers and freelancers to work as independent contractors.
