Why California’s new gig worker bill is right--and wrong

Half the workforce is expected to consist of freelancers by 2020, making it risky from a macroeconomic standpoint to have little to no safeguards. (Photo: Shutterstock)

The recent passage of California’s AB 5 invoked Abraham Lincoln’s famous quote: “You can please some of the people all of the time; you can please all of the people some of the time; but you can’t please all of the people all of the time.”

The bill’s passage will designate a large portion of the contingent workforce (which powers companies like Uber, Lyft and Postmates) as full-time employees. In the world’s sixth largest economy, and directly affecting IPO darlings, this will see effects beyond the confines of California. Based on a 2018 California Supreme Court ruling involving delivery company Dynamex, it re-examines the lines that separate freelancers from FTEs. Now, a significant number of contractors will receive benefits (like insurance, paid vacation, disability and sick days) and be compliant with minimum wage laws. Additionally, AB 5 will end the regulatory arbitrage freelance platforms are trying to get away with.