PRO Act and ABC Test: No One Knows What The Effects Will Be

ABC is a three-part rule to determine someone’s status as either an employee or independent contractor. As explained by the state of California, where it was implemented first in a court case and then codified and expanded in the controversial AB5 law, the three parts require the following:

“The worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact;”

“The worker performs work that is outside the usual course of the hiring entity’s business; and”

“The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.”

Dating to the 1930s, when the employment landscape was vastly different than today, ABC is purportedly in the PRO Act to allow a greater range of people to join unions by classifying a greater number of people, including many independent contractors, as employees for that purpose.

“It really means you can have a union full of independent contractors,” said Domenique Camacho Moran, a labor attorney with the firm Farrell Fritz who only represents management.

To read the full article on Forbes, please click here.