The World Of Work Is Changing... So Why Isn't Legislation?Guest_Blogger | Oct 07, 2009
As pioneers of The New Way To Work, people on Elance are well aware of the benefits associated with our emerging work model. However, independent professionals in the United States face new government legislation. We have asked Regan Parker, responsible for government affairs at LiveOps, to share her perspective on regulatory issues that freelance and contract professionals in the U.S. should be aware of.
As a provider of services on Elance, you’re part of a much broader global movement that is changing the way the world works. At every level, the national media is recognizing the new world of work – a world where work doesn’t mean a long commute through traffic, a time clock, or a desk and cube in a big office building. Businesses like Elance and LiveOps are powering a new economy where workers are taking control of their schedules and their lives, trading in traditional “employment” and becoming independent freelancers and micro-business owners.
We’d all like to see government support this movement and encourage the sort of freedom and opportunity that this new freelance economy is bringing to modern workers. Unfortunately, government is often slow to react to change, and at times is even resistant to it. As the head of government affairs for LiveOps, I’ve been invited by the Elance team to share with you information about proposed legislation in Washington that would ultimately discourage companies from contracting with independent workers such as yourself and to let you know how you can get involved. This legislation is part of a growing trend in Washington to set us back decades in the name of worker protection reform and threatens your ability to provide freelance services and earn a living on your own terms.
Instead of providing the certainty that the classification test desperately needs, this legislation seeks to change the tax code to make it more difficult for companies to engage independent contractors. The bill, HR 3408, proposes to take away one of the safe harbors from the existing code, introduces classification status reviews, and automatic appeals for workers found to be contractors. In addition to these burdensome and costly processes, the bill also increases the fines for misclassification. Companies who engage contractors on a large scale and who have begun crowdsourcing work will face significantly higher risk if this legislation passes, resulting in a chilling effect on companies willing to engage a freelance workforce.
We can all understand the good intentions that motivate this legislation. There have been widespread abuses of contract labor and many people have been taken advantage of and denied a fair wage. Legitimate companies have been undercut by unscrupulous businesses who put forth a lower bid for a job by denying workers benefits and wages. Independent contracting cannot and should not be a way for companies to get a competitive advantage or to deny the basic rights that workers deserve.
But what some people in Washington don’t seem to understand is that for some, this independence is, in fact, a choice. For a growing minority, freedom, flexibility and the ability to work on one’s own terms outweigh any relative benefits that being an employee may bring. Unfortunately, in an effort to right the wrongs of worker abuse, Congress has failed to look at all of the positives taking place in the realm of workforce innovation. The world of work has changed. The securities that we once depended on are gone, and a new way of working has taken hold in this economy. Traditional employment is no longer the only viable option.
There will always be plenty of employee or union jobs for those who seek the traditional notion of security. But for those who wish to live and work on their own terms, in exchange for the protections and safety nets that we have all watched disappear in the last year, there is a new workforce economy open to them and companies lining up to engage it.
What we need from our government right now is the freedom to innovate. We need more certainty for business, not less. Washington is seeking the next big thing to create jobs for struggling American families. What the economy really needs may not be a product that creates jobs through manufacturing, but a push from this new economy workforce that has changed the notion of work itself.
If you want to learn more about this legislation and what you can do to have your voice heard by Congress, log on to www.theneweconomyworkforce.org and share your story.
About The Author:
Regan Parker is LiveOps Corporate Counsel and responsible for government affairs which includes policymaking around the LiveOps business model, the freelance economy and the future of work. She is responsible for the advocacy website www.theneweconomyworkforce.org, designed as an open community for individuals and businesses to educate, network and share ideas about the opportunities of the new freelance economy.