(ConservativeFreePress.com) – A state governed by Democrats has enacted a law that imposes significant registration fees and raises privacy issues for independent contractors or freelancers. According to labor professionals, this might be an experimental approach that could be replicated in other states.
“Shock and dismay are the common reactions I am hearing,” says Mike Hruby, the President of New Jobs America, while discussing the workers’ response with Fox News Digital. He adds, “This bill has quite a complex background, but there’s nothing beneficial to state from any freelancer, self-employed person, or gig worker about this legislation. In my view, it simply serves as a state power grab.”
During its most recent regular legislative session, Democratic Governor Daniel McKee of Rhode Island endorsed State Bill 427. The bill mandates every independent contractor to annually submit a designation form and pay a $50 fee to the state’s Taxation Department.
The law also asserts that a failure to submit the form or to switch to an employee status – beginning next January – could lead to a felony charge.
Gabriella Hoffman, a senior fellow at the Independent Women’s Forum, also shared her concerns with Fox News, saying, “It appears to be another way to single out independent contractors who constitute a significant portion of the small business workforce.”
She further emphasized, “More than a quarter of the small business workforce, contribute millions, if not billions, to the state economy annually. Though the fee seems insignificant, it can be seen as a deterrent to starting such work.”
According to 2022 data from Neilsberg, over 85,000 gig workers in Rhode Island represent 27% of the state’s small business sector.
Hruby argued, “I doubt this bill was on the governor’s or legislature’s wish list. I suspect it was crafted elsewhere. It has been meticulously drafted to adhere to almost all the norms that unions usually follow, which tends to be vague, severe, and completely unfavorable for anyone wishing to remain a self-employed independent contractor.”
The law also includes a provision for a public, searchable database which will list “the relationship between a contractor and the hiring business.”
Both Hruby and Hoffman warn that this requirement could potentially infringe on numerous individual privacy rights. Moreover, they agree that the database poses an anticompetitive threat as it might indirectly encourage client poaching or intimidation.
They foresee that many independent contractors will likely fail to meet the January 31 filing deadline, leading to a reduction in the state’s independent worker count or compelling them to relocate their businesses and families to other states.
Hruby predicts that this law may set a precedent for other Democratic-governed states such as New Jersey, New York, Massachusetts, California, Minnesota, and Colorado.
For independent contractors in Rhode Island who are concerned about this contentious bill, Hruby and Hoffman remind them that legal assistance is available and there may be grounds to sue the state.
“The independent contracting field offers a fantastic opportunity for many people who are creative, proactive, insightful, and motivated,” states Hruby, the President of New Jobs America. “Unfortunately, due to a few malicious players who aim to tarnish its reputation, it is being wrongly vilified, and this legislation in Rhode Island is certainly part of that agenda.”
Copyright 2023, ConservativeFreePress.com
