Brace AB5 to save immigrant workers
Last week, a California appellate court upheld Proposition 22 — a 2020 state ballot initiative that defines appbased rideshare and delivery drivers as independent contractors rather than employees — reversing a lower-court decision from last year. The ruling was a major victory for gig companies such as Uber, Lyft and Doordash, which spent over $200 million to pass the measure. Though the case may go to the California Supreme Court for review, Prop. 22 remains the law of the land and many gig economy workers are shut out from workplace protections.
Even with Prop. 22 in place, however, California workers still have AB5, passed in 2019, to protect them. The law defines employment broadly, granting a broad swath of workers access to basic protections, including a minimum wage, workers’ compensation and unemployment insurance. AB5 remains the most significant recent reform effort to combat employers who “misclassify” their workers as independent contractors to deny them legal rights. States seeking to improve workplace protections are likely to follow California’s lead in this regard, while gig companies have already begun looking into passing copycat versions of Prop. 22 elsewhere.
With this in mind, California lawmakers should consider taking all steps available to strengthen AB5. One way they can do this is to bolster the law’s protections for undocumented workers.
Undocumented immigrants without federal work authorization are disproportionately likely to be wrongfully classified as independent contractors. This “misclassification” affects not only immigrant taxi and rideshare drivers but also countless workers in heavily immigrant occupations such as residential construction and janitorial work.
This is no accident.
As the labor sociologist Ruth Milkman has written, businesses have developed strategies over the past halfcentury to weaken the power of organized labor and create more precarious forms of work, including the use of independent contractor status to avoid legal and financial obligations. Over time, as conditions worsened in numerous industries, U.S.-born workers left for better prospects if they could, and undocumented immigrants — barred from formal employment by federal law — frequently took their places. As a result, Milkman writes, jobs that once paid a decent union wage were “transformed into ‘jobs Americans don’t want.’ ”
Given the prevalence of misclassification in heavily immigrant occupations, undocumented workers are likely to be overrepresented among the estimated 1 million workers who have been reclassified as employees statewide.
AB5 applies to undocumented workers no less than to U.S. citizens or immigrants with legal status. Under California’s new legal standard, most employers should presume that their workers are employees, regardless of immigration status. And thanks to an earlier California law, all employees are entitled to the full protection of the state’s labor code.
Implementation of AB5, however, poses unique challenges for undocumented workers.
Most important, many employers may assume that if state law requires them to treat their workers as employees, federal law does as well — including the obligation to verify that all employees are legally authorized to work, using the I-9 form that is familiar to new hires. This assumption could lead many immigrant workers to lose their jobs or encourage them to provide false documents, which could expose them to criminal or civil immigration penalties. Fortunately, a state law that defines a given worker as an employee does not necessarily trigger the I-9 requirement. Federal law applies a narrower definition of employment than AB5, meaning that this same worker might still be considered an independent contractor for immigration purposes, exempt from immigration verification.
In other words, states like California can provide their undocumented residents all of the protections of employee status without triggering any federal immigration consequences — but to do so, they need to clarify employers’ responsibilities. Reform bills building on AB5 should include unambiguous language explaining that California intentionally defines employment more broadly than federal immigration law. Crucially, both the legislative text and outreach efforts to businesses should make clear that AB5 does not require employers to verify workers’ immigration status. In the industries where many undocumented workers earn their livelihoods, these clarifications may not only help to keep people in their jobs, but better protected on the job as well.
On a related note, like many other states, California has a law on the books that criminalizes immigrants who use false paperwork to secure a job, which essentially duplicates penalties at the federal level. This law is a holdover of the infamous nativist 1994 ballot initiative, Proposition 187. Lawmakers should repeal this relic from a time before California became the progressive, pro-immigrant state it is today. Decriminalizing immigrant work would serve the aim of AB5 to empower workers by bringing them under the protection of the formal economy.
AB5 is not a perfect solution to the problem of employee misclassification. No matter how the law defines employment, businesses will intentionally design their workplaces to provide the fewest rights to their workers. And for the many undocumented immigrants who rely on freelance or independent work, it may be harder to find opportunities to support themselves as the state implements the new law. Labor code enforcement must be attentive to both of these concerns. But AB5 and bills like it are a step in the right direction for workers. Even as the courts give their blessing to Prop. 22, lawmakers can and should begin to think about taking the next step — ensuring that the protections of California’s labor code apply to as many workers as possible, regardless of immigration status.