The whole concept of the Gig economy has obtained a new meaning in 2020. When due to the Pandemic thousands of people have lost their jobs and businesses, many of them saw this as a fateful moment and sign to review their vision on life, work, and independence. The term Gig Economy is not new. It has existed for many years and even centuries. Independent contractors have appeared as soon as the first pre-historic man needed to have his pre-historic cave colored and didn’t have time or skills to do it himself.
The whole concept of freelance work and outsourcing has turned into a new-age philosophy when the generation of Millennials has turned it into a mainstream lifestyle. Not being anchored to a workplace and the option to develop your career combining the best features of entrepreneurship and employment started to become a hyped trend several years ago. But who would assume that in 2020 the concept of the Gig Economy would be called the main hope of the global market for a stable recovery in the post-Coronavirus era? From a hype trend freelance has turned into a full-time economical phenomenon. And of course, now it requires a serious review of legal regulations that would set a balance between employers, freelancers, and the Government.
California freelance endangered
The blessed state of California, which is famous for the biggest concentration of freelancers in the US, has turned into a real battlefield between gig economy enthusiasts and the authorities.
The business relationships between employers and freelancers have been regulated by a controversial AB5 (Assembly Bill 5), sometimes called “The Gig Worker Bill”. It went into effect on January 1, 2020, and the main essence of this regulation was the requirement for businesses that hire independent contractors to reclassify them as permanent employees. The bill was originally aimed to regulate business and financial relationships between freelancers and employers and to resolve the long-lasting copyright issues for such professionals like writers and photographers. But the road to hell is paved with good intentions. Eventually, the AB5 resulted in 2 devastating tendencies:
- The amount of lawsuits in the Gig Economy field has increased dramatically
- Seeking for more comfortable and flexible conditions, California employees preferred to hire freelancers from other states.
Another feature that has turned AB5 into a minefield for freelancers and their employees was the so-called “35-submission cap”. It provided that freelance writers and photographers are not allowed to make more than 35 submissions for one employer per year.
Freelancers strike back
The controversial bill has caused a strong wave of discontent right after it has gone into effect, forcing California Assemblywoman Lorena Gonzales to reveal updates to it by the end of February already. But the Pandemic and the Lockdown caused by it have changed the market for good and shaped a new face of freelance work, making it a rightful player on the employment market. Initiative groups representing the interests of California freelancers stood up to the absurd regulations, that have restricted the legal aspect of free-employment making it unworthy for all participants of the Gig Economy in California.
Writers, photographers, and musicians, who have been arguing AB5 from the very beginning, have now obtained relevant data and proof of their recent concerns. While businesses remained in an unstable and unpredictable position and experts were forced or preferred to stay independent, the demand for gig business relationships has grown dramatically in the past few months. However, the regulation implied by AB5 reduced the number of opportunities while hiring a freelancer a customer has practically faced all the legal requirements of full-employment.
The new amendments have greatly eased employment regulations for most freelancers. The elimination of the notorious “35-submission cap” is named among the main achievements of the new agreements. Also, the field of action was broadened for translators, recording artists, songwriters, and promoters. However, the position of those who work with “motion picture” aka streamers and videographers remains unclear. However representatives of CAFWU (California Freelance Writers United) – the group that has initiated the dialogue between freelancers and the Government claim that representation of journalism, writing and photography increases in multimedia dramatically, therefore the ban on freelance videography might turn into an insurmountable obstacle for the development of the industry and has to be revised as well.