Radical labor legislation threatens to wage war on small businesses and workers

Op-EdAppeared in The Hill on September 6, 2021By Alfredo Ortiz

Labor Day is an opportunity to celebrate the incredible contributions ordinary workers make to the economy. Nearly 150 million Americans work to create the most advanced economy the world has ever known. Yet this prosperity is threatened by radical labor legislation known as the Pro Act that amounts to a Democratic declaration of war on small businesses and workers. The Pro Act would especially hurt Hispanics, who are disproportionately entrepreneurial and more susceptible to the legislation’s harmful regulations.

President Biden and Democrats in Congress have included aspects of the Pro Act, which passed the House of Representatives in March, in their pending $3.5 trillion budget framework. Senate budget reconciliation rules prevent the worst aspects of the Pro Act from becoming law. But the bill’s fiercest congressional champion, Senate Budget Chairman Bernie Sanders (I-Vt.), will try to include as much of it as possible.

The Pro Act would subject independent contractors to strict labor criteria that involves proving that their jobs aren’t under the direction or control of those who hired them, among other burdensome rules. This new scrutiny could make millions of independent contracting positions illegal, threatening the livelihoods of nearly 60 million entrepreneurs who earn some or all of their income through contracting. Hispanics, who start businesses nearly 40 percent more often than Americans as a whole, are especially vulnerable. Since contractors can set their own hours and working conditions, this form of work is particularly attractive for single mothers who are trying to balance work and family responsibilities.

The Pro Act also wages war on America’s successful franchise system, which has offered approximately 775,000 Americans a ticket to the middle class as small business owners. The bill codifies an Obama-era joint employer standard that makes franchisors jointly liable for their franchisees’ employment decisions. To ward off potential lawsuits as joint employers, franchisors would have to curtail franchise opportunities, limiting them to the most qualified applicants and reducing business opportunities for Hispanics who often have to work harder for the same credentials. Minority-owned franchisees tend to operate in minority-owned neighborhoods and hire minority workers, meaning this Pro Act provision also would reduce minority job opportunities.

The Pro Act also would eliminate right-to-work provisions, which allow employees in 27 states to keep their jobs even if they don’t want to belong to a union and pay dues to union bosses. Right-to-work protections are especially important for minorities who long have faced union discrimination. Right-to-work protections offer them the freedom to be judged by their employers based on merit and work ethic, rather than sclerotic union seniority agreements. Right-to-work states have more economic opportunities, offering lifelines to job seekers in underserved communities.

Why do President Biden and Democrats in Congress support legislation that would hurt Hispanic small businesses and workers by curtailing independent contracting, franchising and right to work? Because their labor boss paymasters demand it. Big labor unions donated over $200 million to Democrats and liberal groups in the last election cycle, including $27.6 million to Biden’s election campaign alone. The Pro Act is their return on investment.

The Pro Act would line union bosses’ pockets at the expense of small businesses and employees by 1) turning independent contractors into unionizable employees, 2) making it possible to unionize entire franchise brands (rather than merely independent franchises), and 3) forcing employees who don’t want to be part of a union to pay dues. The Pro Act allows coercive unionization practices such as card check, exposing vulnerable workers to Chicago-style organizing tactics. No wonder unions have made the Pro Act their top priority, going so far as supporting the elimination of the filibuster to pass it.

The only thing preventing Democrats from selling out small businesses and workers to union bosses by passing the Pro Act is Republicans. Senate Republicans should campaign — especially around Labor Day — on defeating this anti-worker, anti-small business, and anti-Hispanic legislation that would strike a devastating blow to the opportunity economy and devalue American labor.

Alfredo Ortiz is the president and CEO of the Job Creators Network, a small business advocacy organization that recently launched the KeepAlaskaWorking.com campaign.