It was full court press on Tuesday in front of the California Capitol. Assembly Republicans were joined by California Congressman Kevin Kiley to warn against the Department of Labor’s impending Independent Contractor Rule. This Rule seeks to take the worst of AB5 national, destroying the independent contractor model in the same way AB5 did in California. Republican Assembly Leader James Gallagher announced the partnerships with California small business leaders as well as the introduction of legislation by Assemblywoman Kate Sanchez (R-Mission Viejo) to repeal AB5.
There are few things more American than starting your own business & working for yourself. For too many Californians, that dream was ripped away by AB 5. That’s why I’m introducing legislation to fully repeal AB 5 & help restore the jobs that law needlessly destroyed. pic.twitter.com/ByKL8GMawV
— Assemblywoman Kate Sanchez (@AsmKateSanchez) January 23, 2024
Republican lawmakers, including Assembly Republican Leader James Gallagher (Yuba City), Rep. Kevin Kiley (Rocklin), Asm. Kate Sanchez (Rancho Santa Margarita), joined business advocates Tom Manzo from the California Business & Industrial Alliance and Matthew Estipona of the Associated Builders and Contractors to announce new efforts in their fight to protect independent contractors. In the California Legislature, Asm. Sanchez will introduce legislation to repeal state limits on contractors imposed by AB 5, while on the federal level, Rep. Kiley will challenge the Biden administration’s new rule that creates national restrictions on independent contracting.
“Here in California, we’ve seen firsthand the disastrous consequences of AB 5. Joe Biden and Julie Su’s efforts to expand it nationwide will destroy the careers of millions of hardworking independent contractors,” said Gallagher. “We should be helping and encouraging people to start businesses and build careers – this Biden/Su proposal does the exact opposite.”
Unlike the typical Republican press scrums, these press conference partnerships between Asm. Gallagher and Rep. Kiley are bold and effective. When Rep. Kiley last joined forces with his former California colleagues, it was to warn against Biden’s nomination of Deputy Labor Secretary Julie Su to Secretary of Labor. Kiley reminded us about the success of this unified effort.
We won that battle. We were able to effectively show what her leadership at the Department of Labor here meant to California. And when the United States Senate and folks across the country got a glimpse of that, the country said, “No thank you.”
This Independent Contractor Rule is designed to mirror the ABC Test in AB5, and as Kiley further warned, “will have similarly disastrous effects.”
The way we know that for sure, is again, of all the people that President Biden could have chosen to be the Secretary of Labor, we’re a country of 300 million people. Who does he choose but the very architect of AB5 itself to enforce his new Independent Contractor Rule.
Kiley gave more grim news should the Independent Contractor Rule be implemented. Quoting numbers from the center-left technology coalition, Chamber of Progress:
Earlier this year, Chamber of Progress released a new economic analysis finding that a national rule reclassifying gig workers and independent contractors using an ABC test could result in a loss of direct income for approximately 3.4 million American workers. The study, available here, reports that a broad reclassification could cost the nation’s most vulnerable communities more than $31 billion in lost income.
But then Kiley got down to brass tacks and brought the good news with an outline of how Congress, business concerns, and independent contractors plan to go on the attack.
Everyone understands what Independent Contractors, freelancers, folks who work in the gig economy in California have been through.
Interestingly enough, the Department of Labor has not submitted this new rule to Congress. When they do, Kiley will use the Congressional Review Act to put the rule under review in order to rescind it.
We are building a broad coalition to reverse this regulation, Kiley said.
Kiley also referenced two lawsuits filed against the Independent Contractor Rule. One by the Financial Services Institute, which is premised on procedural errors in implementing the Rule, and the other by a group of writers and editors under the banner of Fight for Freelancers on constitutional grounds. Kiley concluded his remarks by warning about the promise Julie Su made about enforcing AB5 when she held the role of California’s Labor Secretary.
But when I think about what is at stake for our country right now. I think about a comment that Julie Su made back when she was here in California as our Labor Secretary, in 2019 after AB5 was signed by Gavin Newsom. She was talking about what she was going to do to enforce it. She said “we’re going to do audits, we’re going to go in and exact fines and penalties. We’re going to force people to comply, and if they don’t, they’re just going to have to understand that this is not the kind of economy we want in California.” Not the kind of economy we want in California, where folks have the ability to pursue the American dream, to work on their own terms.
As Republican Leader, Assemblyman James Gallagher has been leading the charge to rescind California policies that are causing great harm to the constituents. He lamented the result of those policies locally and nationally.
People are losing jobs. And now, because of Biden’s policies also, they are facing record inflation that we haven’t seen in a generation. And people are struggling in this state. It’s getting harder and harder to pay the bills, to pay the utility bill, to pay your gas bill, to pay your rent. Tougher and tougher in this state because of the policies that are coming out of this building in Sacramento, and now on the national level under the Biden administration.
Gallagher concluded his remarks by focusing on their multi-pronged efforts.
Why are we doing this? We’re doing this for the everyday Californian who has been taxed enough, who has been burdened enough, and who has seen their rights violated. And who right now need some relief. They need relief from these burdensome regulations.
This is what unified Republican lawmakers look like, and this coalition has shown its effectiveness. National Republican lawmakers need to take lessons.