How Utah Is Protecting Workers Without the Baggage of Unions | Opinion
This week, Utah Governor Spencer Cox signed a groundbreaking, bipartisan portable benefits bill into law after it sailed through the legislature nearly unopposed. This new labor policy stands to greatly enhance the ability of self-employed Utahns to access health care and other benefits. Members of Congress should take note.
President Joe Biden's federal labor priority, the Protecting the Right to Organize Act, or PRO Act, was recently introduced in Congress by Representative Bobby Scott and Senator Bernie Sanders. It is a partisan bill that for all practical purposes is dead on arrival.
The PRO Act passed the U.S. House in 2021 on almost completely partisan lines but died in the Senate with a lack of support. Now it's back with some changes but the same broad goals. These include significantly limiting self-employment careers by instituting a California-style "ABC" test that aggressively reclassifies self-employed workers as employees and generally altering labor laws to greatly increase the likelihood of each workplace being unionized, in return diminishing individual worker choice and flexibility.
In essence, the PRO Act ushers in more union and government control of private businesses and industries, returning workers to more rigid workplaces reminiscent of the mid-20th century.
These policies are not subtle. The National Labor Relations Board would use an ABC employment test to pursue what it deems as misclassification of independent contractors, allowing it to fine targeted businesses between $50,000 to $100,000 for "unfair labor practices" and convert self-employed workers to union eligible employees, threatening millions of current self-employment and small business careers while eliminating future opportunities and workforce innovations. This includes many working mothers around America, who currently continue professional careers while raising children with flexible contracting work who will be forced to search for a traditional job that fits their schedule poorly or to seek expensive, hard to access childcare in order to earn much needed income.
Every collective bargaining contract could legally ban Right-to-Work policies that give private workers a choice over whether to pay union fees as a condition of employment. Franchisees and vendor businesses would face a restrictive new joint employer standard that adds legal and employment liabilities between businesses, forcing small businesses owners to instead become managers under larger businesses even though neither entity wants such an arrangement.
Furthermore, businesses would be legally forced to give union organizers all personal contact information of each worker, initial union contracts could be settled through third party binding arbitration deals that workers must accept, workers would be limited in challenging union violations or removing unions they dislike, and in some instances, workers would lose the right to secret ballot elections. This ignores dozens of other significant policies in the PRO Act.
Despite polls indicating that American families dislike PRO Act policies and have increasingly embraced flexible work paths at traditional jobs and self-employment careers, particularly after COVID-19 disruptions, this misguided legislation remains a priority for President Joe Biden and Democratic leaders.
But members of Congress need not share my PRO Act concerns to find common ground. Despite competing views around independent contracting and labor policies broadly, Utah lawmakers united to advance access and opportunity for self-employed workers, seeing a way to improve lives in Utah.
Utah's Portable Benefit Plan is a national breakthrough for independent contractors, establishing a legal pathway for entities to offer fully voluntary benefits plans that self-employed workers can open on their own.
Unlike employer-sponsored health plans for traditional employees that are tied to jobs, Utah's self-employed workers instead will soon have access to a variety of new benefits plans that are entirely their own and entirely portable for their evolving careers.
The possibilities of products that may be established are broad, including the potential for health insurance, unemployment insurance, and disability insurance related products. There is even a pre-existing financial tool known as a "Utah medical care savings account" that self-employed Utahns may conveniently use to pay for their portable health insurance benefits and medical expenses.
Many opponents of independent contracting argue that such workers are exploited and deserve the health care and other benefits that many traditional employees receive.
Yet this dismisses the fact that a rising workforce of 73 million freelancers, including independent contractors, are more satisfied with their careers than traditional employees. After all, ICs can earn more income and flexibility that working mothers, disabled workers, budding entrepreneurs, and others gain from being their own bosses or rely upon to even have a chance to work at all.
Skeptics fail to consider that government laws and regulations are the source of the very barriers preventing ICs from accessing better benefits in the first place. Government rules block health and other benefits from being offered to ICs.
Utah's standard-setting bipartisan reform eliminates some of these barriers, opening the door to new possibilities for leaders across America. In other words, even as debate around the PRO Act remains contentious, Members of Congress now have a template to advance bipartisan voluntary self-employment benefits nationwide.
As it turns out, improving career paths by simply removing legal barriers to health care and other benefits access for tens of millions of self-employed Americans is a winning policy even within competing agendas.
Austen Bannan is the employment policy fellow at Americans for Prosperity.
The views expressed in this article are the writer's own.
