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Anybody else think it's interesting that this article is so focused on AB5 - and almost completely ignoring her employer's responsibility in this. What's block

Anybody else think it's interesting that this article is so focused on AB5 - and almost completely ignoring her employer's responsibility in this. What's blocking her from being hired in a properly classified position on a part time basis?

gregd 7y ago
Because companies complain that it adds 20% - 30% to their labor costs.
- toomuchtodo 7y ago
  More accurately, the loophole they've been using to obtain a labor discount (employee misclassification) has been removed.
  - ars 7y ago
    There is no loophole, and there is no labor discount. This is inaccurate. You are speaking of the Employer portion of social security tax (aka Self Employment Tax). All the happens when switching from contractor to employee is the salary goes down, so the final cost to the employer is identical. (And the income of the employee is also identical.) A contractor vs employee is about flexibility on hours. An employee expects a certain number of hours per year - all the benefits are based on that. A contractor has no such expectation, so they have no benefits (because otherwise you would have to scale the benefits up and down constantly based on actual hours worked).
    - gregd 7y ago
      Going from Contractor to Employee status adds 20% - 30% in labor costs. Things like Workers Comp, PTO, unemployment insurance, etc. that companies are forced to pay. There is indeed a "loophole" or labor discount with ICs.
      - ars 7y ago
        > adds 20% - 30% in labor costs. As I said multiple time: In the real world companies simply reduce the salary 20% to 30% in order to keep the final number the same.
        lovich 7y ago
        I would like to see evidence of these mythical companies that pay based on what's fair and not based on the cheapest amount they think they can get away with, while meeting their own goals
        ars 7y ago
        Did you read it in reverse? Reducing the salary is cheaper for the company. Or more accurately employees and contractors cost them the same, it's just do they pay it as salary or as benefits?
        lovich 7y ago
        You're implying that there's a set "value" per employee that the companies are going to pay and they merely subtract their costs from employees while contractors are paid more because they lack these fees. That might be the case for skilled labor that freelances but we've seen a plethora of gig economy jobs be created that trend towards minimum wage or lower. That does not mesh with your claims
      - JordanFarmer 7y ago
        That is why contract positions have a far higher payout. I know many contractors who come out on top this way. Many have a spouse with a job that provides Insurance for the family. They pocket that extra. Others just enjoy the autonomy of the hours they work ETC. If restaurants are exploiting workers by calling them contractors, why do the workers stand for it? Go work somewhere else. Why does that restaurant have cooks on staff if they are indeed mistreating them? Are people so weak in this generation that they can't make things happen themselves and need the government to save them? "Strong men create easy times, easy times produce weak men, weak men cause hard times, hard times produce strong men." Get ready for hard times...
- godzillabrennus 7y ago
  Not to mention employee labor and liability is basically a personal guarantee for a business owner. Hard to justify committing to wages if your business is new or volatile. Easier to just not start a business. California has great programs to help the poor with food, clothing, and energy. At some point it becomes easier to just stop working and live off the state. Then you vote for the party that will let you keep your free stuff. Then you have a land where costs are high and the people are mostly poor. You have California in 2019. https://www.politifact.com/california/statements/2017/jan/20/chad-mayes/true-california-has-nations-highest-poverty-rate-w/ https://www.politifact.com/california/statements/2017/jan/20...
  - taurath 7y ago
    States without a good social safety net do not do better in terms of new businesses. Frequently the opposite - not having an educated workforce, infrastructure, or any amount of established industry keep the bottom states at the bottom. If they did do better at starting businesses, many of us would be moving there.
kasey_junk 7y ago
Cost is the most obvious one. There is likely no shortage of writers to take the position that aren’t governed by this law.
deleted 7y ago
[deleted]
manderson89 7y ago
"Him"? The writer is named Rebecca...
- deleted 7y ago
  [deleted]
SpicyLemonZest 7y ago
What makes you think anything is blocking her? The article makes it sound like she just doesn't want to be hired as an employee. The company's original post (https://www.sbnation.com/2019/12/16/21024100/thank-you-california https://www.sbnation.com/2019/12/16/21024100/thank-you-calif...) encourages everyone to apply for roles in their new org structure.
rolltiide 7y ago
We used to hire employees in California, and even with letting an external payroll company do everything we were still getting civil rights posters like every week. Who were they for? Where were they supposed to go in our coworking space? When we let the payroll company go the administrative burden was such a sidequest to our actual mission that it was untenable. To clarify we ended employee status alongside getting rid of the payroll company. 1099 is just simpler and for the federal government's rules the discretion of the people we worked with fit the requirements for contractor status. So now removing choices for even having employees or not really makes it unattractive for businesses under a certain size. I think they should consider that.

gregd 7y ago

Because companies complain that it adds 20% - 30% to their labor costs.

toomuchtodo 7y ago
More accurately, the loophole they've been using to obtain a labor discount (employee misclassification) has been removed.
- ars 7y ago
  There is no loophole, and there is no labor discount. This is inaccurate. You are speaking of the Employer portion of social security tax (aka Self Employment Tax). All the happens when switching from contractor to employee is the salary goes down, so the final cost to the employer is identical. (And the income of the employee is also identical.) A contractor vs employee is about flexibility on hours. An employee expects a certain number of hours per year - all the benefits are based on that. A contractor has no such expectation, so they have no benefits (because otherwise you would have to scale the benefits up and down constantly based on actual hours worked).
  - gregd 7y ago
    Going from Contractor to Employee status adds 20% - 30% in labor costs. Things like Workers Comp, PTO, unemployment insurance, etc. that companies are forced to pay. There is indeed a "loophole" or labor discount with ICs.
    - ars 7y ago
      > adds 20% - 30% in labor costs. As I said multiple time: In the real world companies simply reduce the salary 20% to 30% in order to keep the final number the same.
      - lovich 7y ago
        I would like to see evidence of these mythical companies that pay based on what's fair and not based on the cheapest amount they think they can get away with, while meeting their own goals
        ars 7y ago
        Did you read it in reverse? Reducing the salary is cheaper for the company. Or more accurately employees and contractors cost them the same, it's just do they pay it as salary or as benefits?
        lovich 7y ago
        You're implying that there's a set "value" per employee that the companies are going to pay and they merely subtract their costs from employees while contractors are paid more because they lack these fees. That might be the case for skilled labor that freelances but we've seen a plethora of gig economy jobs be created that trend towards minimum wage or lower. That does not mesh with your claims
    - JordanFarmer 7y ago
      That is why contract positions have a far higher payout. I know many contractors who come out on top this way. Many have a spouse with a job that provides Insurance for the family. They pocket that extra. Others just enjoy the autonomy of the hours they work ETC. If restaurants are exploiting workers by calling them contractors, why do the workers stand for it? Go work somewhere else. Why does that restaurant have cooks on staff if they are indeed mistreating them? Are people so weak in this generation that they can't make things happen themselves and need the government to save them? "Strong men create easy times, easy times produce weak men, weak men cause hard times, hard times produce strong men." Get ready for hard times...
godzillabrennus 7y ago
Not to mention employee labor and liability is basically a personal guarantee for a business owner. Hard to justify committing to wages if your business is new or volatile. Easier to just not start a business. California has great programs to help the poor with food, clothing, and energy. At some point it becomes easier to just stop working and live off the state. Then you vote for the party that will let you keep your free stuff. Then you have a land where costs are high and the people are mostly poor. You have California in 2019. https://www.politifact.com/california/statements/2017/jan/20/chad-mayes/true-california-has-nations-highest-poverty-rate-w/ https://www.politifact.com/california/statements/2017/jan/20...
- taurath 7y ago
  States without a good social safety net do not do better in terms of new businesses. Frequently the opposite - not having an educated workforce, infrastructure, or any amount of established industry keep the bottom states at the bottom. If they did do better at starting businesses, many of us would be moving there.

kasey_junk 7y ago

Cost is the most obvious one. There is likely no shortage of writers to take the position that aren’t governed by this law.

deleted 7y ago

[deleted]

manderson89 7y ago

"Him"? The writer is named Rebecca...

deleted 7y ago
[deleted]

SpicyLemonZest 7y ago

What makes you think anything is blocking her? The article makes it sound like she just doesn't want to be hired as an employee. The company's original post (https://www.sbnation.com/2019/12/16/21024100/thank-you-california https://www.sbnation.com/2019/12/16/21024100/thank-you-calif...) encourages everyone to apply for roles in their new org structure.

rolltiide 7y ago

We used to hire employees in California, and even with letting an external payroll company do everything we were still getting civil rights posters like every week. Who were they for? Where were they supposed to go in our coworking space? When we let the payroll company go the administrative burden was such a sidequest to our actual mission that it was untenable. To clarify we ended employee status alongside getting rid of the payroll company. 1099 is just simpler and for the federal government's rules the discretion of the people we worked with fit the requirements for contractor status. So now removing choices for even having employees or not really makes it unattractive for businesses under a certain size. I think they should consider that.