Officials at the Department of Justice and Federal Trade Commission hosted a workshop on competition in the labor market on December 6 and 7, 2021.  This seems like the perfect occasion to revisit the status of H.R. 842, the Protecting the Right to Organize (PRO) Act. 

H.R. 842 is the federal version of California’s AB 5 bill.  As noted in a September 15, 2021, WasteWatcher article, the PRO Act would “radically transform parts of the economy and severely harm workers and small business owners while greatly benefiting unions.”  It would impose an “ABC test” to determine whether a worker should be considered a regular employee or an independent contractor and force app-based companies like Uber, Lyft, and Instacart to either stop using freelance contract workers or hire them as traditional employees.  Following passage of AB 5 in California, the ABC test applies to not only app-based companies, but also to other independent contractors like campaign workers, geologists, healthcare aides, housekeepers, language interpreters, land surveyors, nail salon workers, rabbis, strippers, and truckers.  It exempts accountants, architects, attorneys, physicians, and real estate agents.  And in November 2020, Californians approved Proposition 22, which exempts app-based drivers from AB 5, by a vote of 58 percent to 42 percent.  However, there is no such exemption in the PRO Act.

Independent contractors, including those working in the gig economy, enjoy the flexibility of setting their own schedule and being able to supplement their income when needed.  However, if they are hired as traditional employees, the companies where they work would be able to tell them when and where they would work, taking away their freedom and flexibility.  The PRO Act would upend large sections of the economy and deprive workers of the independence to make money on their own time.

The PRO Act passed the House of Representatives on March 9, 2021.  The bill is currently waiting consideration by the Senate but is not expected to be considered as stand-alone legislation by that chamber before the end of the year.  This roadblock led House Democrats to include provisions from the PRO Act in H.R. 5376, the Build Back Better Act (BBBA).  The BBBA provisions taken from the PRO Act include establishing civil penalties for violations of the National Labor Relation Act (NLRA) and making corporate directors and officers personally liable for what the National Labor Relations Board deems a violation of workers’ rights. These penalties could increase to as much as $50,000 per violation of the NLRA. 

 Since the BBBA passed under reconciliation, its provisions must pass the “Byrd Rule” or undergo a vigorous scrubbing known as a “Byrd Bath” in the Senate.  The Byrd Rule requires that all provisions of a bill passed using the budget reconciliation process must be related to the federal budget or taxation.  The Byrd rule is why some provisions like immigration reform were removed from the original BBBA text (but the House put them back in anyway).  Senators and their aides are meeting with the Senate Parliamentarian this week to make their arguments for why certain provisions do or do not meet the requirements of reconciliation.  It remains to be seen whether the PRO Act provisions will pass the Byrd rule and be included in the final version of the BBBA, but the limited provisions from the full PRO Act give them a better chance of getting through. 

  While it is not clear whether parts of the PRO Act will be included in the final version of the BBBA, if Congress is going to pass such sweeping changes to labor law they should do so under regular order with public hearings, the Senate should consider the bill with committee hearings and markups, rather than burying these provisions in a bill that is more than 2,100 pages long.  The PRO Act would radically change labor law and cause tens of thousands of workers to either conform to strict work rules of simply stop working.  At a time when companies are desperate to hire workers and inflation is making wages less valuable, Congress should focus on passing legislation that empowers workers and grows the economy rather than helping Big Labor get more control over the workforce.