Proposition 22

It would be easy to leap right into a detailed discussion of the merits of redefining the rules on classifying people as employees rather than independent contractors, and I will get to that.  But there is something buried in this Proposition that makes it a non-starter in my eyes.

"After the effective date of this chapter, the Legislature may amend this chapter by a statute passed in each house of the Legislature by rollcall vote entered into the journal, seven-eights of the membership concurring, provided the statute is consistent with, and furthers the purpose of, this chapter."

There is no way I would ever vote for a proposition that can never be amended by the Legislature.  I'm shocked that this provision isn't getting more coverage in the ongoing battle between the Yes supporters and the No supporters.

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The issue of people being misclassified as independent contractors versus employees is long-standing.  The 1099 form was initially created in 1917.  In the early 2000s, I taught a continuing education class on the subject during the off-season.  Like everything else involving government, there is a form.  SS-8 is the form used by someone classified as an independent contractor to request the IRS investigate and determine if they should have been classified as an employee.

This is where I have problems with taking a position against Prop 22.  I have a lot of clients who drive for Uber and/or Lyft.  They set their own schedules.  Employers set the schedules of their employees.

That doesn't mean that people who are employees should be intentionally misclassified as independent contractors just to make life easier for the people who employ them.  It's been a long time but I remember one specific client case that makes this point well.  The client was a legal secretary.  The employer was a lawyer who was a solo practitioner.  The lawyer set the secretary's work schedule.  All work was done in the lawyer's office.  The lawyer supplied all of the supplies and equipment.

After 3 years of this, the lawyer let the legal secretary go.  Without notice.  No unemployment benefits for independent contractors.  So the client submitted that previously mentioned Form SS-8.  And the IRS ruled that my client had been misclassified as an independent contractor.  The lawyer had to pay all of their unpaid employer tax obligations, along with a big fine.  No one wins in such a situation.

Uber and Lyft should be providing better benefits to their drivers.  AB5 wasn't the answer.  Neither is Prop 22.