Aimee Benavides has built a thriving career as a translator and interpreter while homeschooling her nine-year-old daughter, who has autism, and 11-year-old son, who is heavily involved in STEM enrichment classes. What makes it all possible is the home-based business she started in 2010, after leaving a full-time job in the court system.
It isn’t easy to juggle it all. Sometimes she starts work at 5:30 am to get her work done—or brings her son to the school board meetings where she takes on evening projects. “The times I don’t take my son with me, they ask, ‘How is your son?’” she says.
Still, Benavides would not trade the flexibility of self-employment for a traditional job. Running a business allows Benavides and her husband, an IT professional, to afford the cost of living in Fresno, Calif., while still permitting them to manage their family responsibilities.
Benavides is one of a number of self-employed women in California who are speaking out in opposition to AB5, a union-backed law aimed at preventing misclassification of gig workers that took effect on January 1. The law presumes that every worker in the state—except those on a list of exempted industries, such as physicians, accountants, architects and engineers—is an employee.
Assemblywoman Lorena Gonzalez (D-San Diego), the bill’s sponsor, tweeted yesterday that under the law “if you are a true independent proprietor, you can still operate as one.”
She pointed to a test that allows sole proprietors, partnerships, LLCs, LLPs and corporations to operate legally in California if they meet 12 criteria—such as being free from the direction and control of the client, providing services directly to the client and not the client’s customers and being customarily engaged in the same type of work they are doing for the client—and pass another multi-point test, known as Borello.
However, many independent workers in California say AB5’s complexity has scared away their clients, who are afraid of getting hit with fines by the state if they misinterpret it. Governor Gavin Newsom’s proposed 2020 budget includes about $20 million for enforcement.
“It’s disingenuous saying you’re trying to help workers and then restricting their ability to bring in income,” says Benavides.
Many interpreters work through agencies that now face a very high bar for proving that California contractors they hire to serve local hospitals or other clients are independent business owners, Benavides notes. She is already being asked to fill out more paperwork to prove she is an independent contractor.
Translators and interpreters are among many fields affected. Faces of AB5, a Twitter account that critics of the law started, includes many tweets from self-employed people in California who say they have lost work—or their entire businesses—as a direct result of the law.
Many opponents say they are people who started their own businesses because they need more flexibility than traditional jobs allow, to manage family responsibilities, like caregiving, or to cope with disabilities.
“Anything you do that cuts flexibility hurts people that need flexibility,” says Steve King, principal of Emergent Research, a firm in Lafayette, Calif., that studies the freelance economy.
Women have had an especially strong voice in opposing AB5 and similar laws under consideration in New York and New Jersey. The American Society of Journalists and Authors, which has filed a lawsuit to challenge AB5 on grounds it is unconstitutional and discriminatory toward journalists, has argued that the law is particularly harmful to women, people of color and the LGBTQ+ community.
“In a shrinking media landscape where hiring executives are still mostly white and male, AB5 places additional restrictions and burdens on women, people of color and the LGBTQ+ community by forcing many of us to seek staff jobs,” said Los Angeles freelance writer and author JoBeth McDaniel, chair of ASJA’s First Amendment Committee, in a statement. “Many journalists choose to freelance because we encountered discrimination, harassment and bullying in staff positions. Others — such as parents, caregivers and the disabled — need the flexibility of setting their own schedules and workloads.”
In recent years, a growing number of women have flocked to self-employment. Given the glass ceiling and gender pay gap in many companies, some women find they earn more as independent workers than in a traditional job. For those juggling caregiving and a heavy load of unpaid household work, running a business from home instead of commuting is often the only way they can get everything done.
Because of factors like this, women are now the fastest growing group of business owners in the country. The number of women-owned businesses rose from 21% from 2014 to 2019—compared to 9% for all businesses, according to the State of Women Owned Businesses Report, commissioned by American Express.
The trend is even stronger among minority women. Firms run by women of color grew by an “astounding” 43%, the researchers noted, and businesses run by African American/black women increased even faster, by 50%.
Women are also statistically overrepresented among owners of “nonemployer” businesses—meaning those with no payroll, according to the Small Business Credit Survey, a collaboration of 12 Federal Reserve Banks across the United States. Many of the owners of nonemployer firms are independent contractors, running the kind of businesses most affected by gig-economy laws like AB5.
“AB5 will make it more difficult for employers to establish that a worker is an independent contractor,” explains Paul Kramer, an employment law attorney who is director of compliance for Workforce Software, a cloud-based workforce management solution used for employee scheduling, attendance and other functions. “Independent contractors have more freedom and flexibility in how and when they do their work. They control themselves as opposed to being controlled by an employer. To the extent a female worker is an independent contractor and becomes an employee, there could be a loss of freedom there.”
That’s a major concern to women who have built their lives around freelancing and independent contracting. With 49% of women (including 42% of working women with children) now their family’s primary breadwinner, their economic fate affects their families, too.
“On our profession, I’ve see a lot of my female colleagues are the main breadwinners in their household,” says Benavides. “Interpreting and translating is really a female-dominated profession. One of the things that draws us is it’s so flexible.”
While a traditional employer could offer workplace flexibility or a remote work arrangement, Benavides does not want to take her chances.
“Just because employment starts out flexible, it doesn’t mean it will stay that way,” Benavides says. “Once you are in an employer-employee relationship, you lose your bargaining power.”
There are other benefits to independence, she finds. Benavides believes that her status as an independent business owner allows her to negotiate workplace protections for herself that traditional employment would not allow.
“If someone cancels me within 24 hours of the appointment, I can still charge them my fee,” says Benavides. “If you are a W-2 employee, no one is going to pay you if they cancel your shift. You don’t have a say. By being an independent contractor, you get to negotiate those terms. If they say, ‘We don’t pay a cancellation fee, I can say, ‘I charge one, so if you want to work with me, those are my conditions.’”
Web developer and project manager Rona Prestler says she lost two clients as a result of AB5. With … [+]
Rona Prestler, a web developer and project manager based in West Covina, a suburb in Southern California, also finds self-employment has many benefits she doesn’t want to lose. She has relied on freelancing to earn a full-time income from home since 2016.
Prestler left a job at Sprint after having the first of her two children. She discovered she could make a nice living by finding clients on a site called HireMyMom.com. Her husband travels frequently for his job doing electrical work for cell towers and puts in long days, so it helped the family for her to stay close to home.
“I had my schedule set,” she says. “I would work before they woke up. I had a nanny come in the morning. I’d hang out with the kids during the afternoon and get back to work at night. I got in a good number of hours with minimal childcare. It was just perfect.”
That all changed since AB5 passed. With the law about to take effect, one of her four clients let her go the week before Christmas. “He couldn’t afford to keep me on as an employee,” she says. Another out-of-state client dropped her, concerned that a lack of clarity in the language of the law might lead to a risk of fines later on.
Prestler now thinks she will be forced to look for a traditional job. Commuting to Los Angeles will take three hours round trip every day, so she and her husband are considering moving.
They haven’t quite figured out how they will absorb an increase in childcare costs from $1,000 a month to $2,000 if she has to commute. Even if she can get a job in her expected salary range and the family eliminates clothing purchases and the occasional dinner out, they will come up about $12 short a month, she says.
Meanwhile, Prestler dreads the thought of being separated from her children, now ages one and four. “I’m really sad I can’t be with them anymore,” she says.
Jessica Tucker (center) says her freelance work allowed her to balance family responsibilities with … [+]
Women who freelance part-time say AB5 has been a blow to them, too. Jessica Tucker, a mother of three children ages nine, 12 and 24, began doing freelance transcription and closed captioning work from her home in Loma Linda, Calif., about three years ago.
With one daughter attending a school where her schedule changes every day, Tucker is not sure how she will replace the lost income now. “I can’t go to a regular job and work regular hours,” says Tucker.
Running a business where she controls her own schedule has also allowed her to babysit for her older daughter’s child two days a week, go back to college and to work through an illness that required major surgery and bed rest over the course of a year.
“Being independent and setting my own hours really made the rest of my life possible,” she says.
Tucker is not sure what the future will hold now that she lost one of her best sources of work, a website where clients posted transcription projects. She received a notice saying the site was letting go of California contractors in response to the law.
Tucker estimates she will lose a couple of thousand dollars a month. She has never “been political,” she says—but AB5 has galvanized her. “I am going to exercise that power and get back my life,” she says.