California’s new employment law has boomeranged and is starting to crush freelancers

Jeremiah LaBrash, 36, works as a tech programmer for a telecom by day and as a freelance cartoonist for media companies on his time off. Sometimes he brings in half of his annual income from his freelance work.

That changed when Assembly Bill 5 passed in California and Gov. Gavin Newsom signed it into law on Sept. 18. The law requires most companies to reclassify contract, freelance and contingent workers — the backbone of the gig economy —as full-time employees eligible for benefits, a guaranteed $12–$13 state minimum wage and protections under the state’s employment law.

LaBrash, based in Los Angeles, suddenly found potential projects drying up when he submitted onboarding paperwork to potential clients and they discovered he lived in California.

“I’ve had them hire me and then come back and say they’re no longer interested,” says LaBrash. “All of a sudden, someone I’ve never talked to says, ‘We’ve decided not to move forward.’ I’ve never had that happen before this year.”

LaBrash can’t be certain the reason is AB 5, though he believes it is. He has seen a 40% decline in his freelance income since the law passed in September. “My savings are stagnant,” says LaBrash. “I really can’t look into buying a house. The housing market here is hard already.”

Even if employers hire him for freelance work, he is limited to 35 annual submissions per client before they have to put him on payroll, he notes. It’s a limit under the law. That’s not a large amount for regular contributors to media companies. “You’re going to hit your quota and they won’t want to hire you,” he says.

Law created to destroy the gig economy is destroying the gig economy. Let’s all act surprised!

Intended Consequences Are Intended


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