Note that this article, “AB5 Has Passed. Now What?” is the sixth of a six part series we will be posting about California Assembly Bill 5 (AB5) that just passed the California State Senate. We published this week’s episode of the Deliver on Your Business podcast early due to the pending passage of AB5. Normally we run a companion post that matches the podcast episode. There’s just so much to talk about with AB5 that it couldn’t be fit into a full episode, so I decided that a series related to it would make more sense.
AB5 is now the law of the land. Well, almost. It has to go back to the state assembly for approval on the ammendments that happened recently, and the governor has to sign it. The legislation says it takes effect January 1. Couriers in California are about to become employees.
As couriers working with gig economy apps like Grubhub, Postmates, Doordash, Uber Eats, what do we do now? Obviously that question is more urgent if you are in California. This law is a game changer though – how should we respond?
Insert the Aaron Rogers sound clip here (if you're a football fan you probably know what I mean). Relax.
You are not an employee right now. Nothing has changed. Nothing will change for awhile.
The law takes effect January 1. That's not a given. You can guarantee there will be court challenges. Gig companies are trying to get something on the ballot, to get it to the voters. There's the potential they can get this delayed at least until the issue has been able to be decided on the ballot.
We don't know exactly when it will happen. What we do know is, there's time.
1. Do Some Soul Searching.
You don't have to make any changes right away. But it is time to start asking yourself some very deep questions that really get to the heart of who you are and what is important to you.
If you are in California, you know that changes can be happening potentially in a little less than four months. What will that mean for you? Understand that because you are a contractor, it is not a guarantee you would be hired as an employee when that transition happens. What do you do then? It's not something to panic about by any means, but you have at least a few months, maybe a year or more depending on the courts and all that other stuff. You can be ready.
Yes, that's a link in the headline. I think it's worth the read. Knowing your why is critical to whatever step you take next.
How often do you ask yourself that question: Why am I even doing this? Have you dug into that reason? Have you searched yourself to examine what got you here? Do that. Because here's the thing: understanding your why will go a long way to getting clarity on where you go from here.
This is not conventional work. There's something that has you doing it. Is it to allow you to do other things you are passionate about? Is it to let you do something special with your family? Is it to save up for something really meaningful?
The reason I tell you to dig into your why is that the important thing is not the what, it's the why. When you know your why, when you really get a good feeling for the stuff that is so incredibly important for you, THAT is the stuff that helps you figure out the what next. THAT is the stuff that might say there doesn't need to be a what next.
Ask yourself if employment status works for you.
There's a lot of you who will answer in a heartbeat, ‘hell yeah.' Others, it's more like ‘nah, I'll take a pass.' And a lot of us in between. There's no right answer on this question other than what fits you best.
I've said this a lot, that if I have to become an employee, I'm out of here. I'm not sure that's necessarily true. But maybe explaining what I mean helps understand the importance of that ‘knowing your why' that I just talked about.
My why is that I'm passionate about helping older adults age successfully, and more specifically about helping churches help their older members age well. I got my masters in Gerontology and I have a ministry background, and I want to use combine those. This is not a thing where there are a ton of jobs out there. That's okay, It's not about the job, it's about doing it. I don't know if that makes sense. So I'm working on projects to do that. They won't generate any revenue for awhile but the bills have to be paid. I choose to be an independent contractor doing something where I have ultimate flexibility around my work. I can work around appointments and other things. I work to support my passion.
So where I'm going with this is, I find myself in the camp where I can't see taking an employment position because that flexibility is so important to me. It's all about my why. But if the employment option came along in just such a way that I could still meet my why, I would be open to it.
So here's the thing I invite you to do when thinking about whether being an employee would be a fit. If you're dead set against employment, why is that? Now compare that to your why. How important is your reason to not be an employee? Are there times being an employee better helps you meet your why? Do you see where I'm going? Understand your why and compare that to the benefits and disadvantages of whatever situation you might be looking at.
Ask Yourself What You'd love to do with your life
Again, this goes back to your why. Is there something that better accomplishes your why? Is there something that you look at what someone does and think, “I wish that could be me?” Why couldn't that be you?
You have those things that, when you're doing them, you just feel like you're in the zone. What is it? Think about what you love the most about delivery. Why is that so meaningful to you? What about any jobs you've done – what do you love the most about anything you've done? Where do you feel like you're in your element?
You hear the advice to work within your passions, work where you're happy. I can't echo that enough. But I'll tell you, I hated that advice at one time because I had no clue where my passions were. I don't know if I had any. I had to go through a process where my passion was discovering my passion.
2. Understand what changes might mean for you
If you're in California, start paying attention to how things would be different for you if you are an employee. In Califronia, minimum wage is $12 per hour and tips are on top of that. They also have to reimburse you for your car expenses. What would that look like. Get to know how things are for you right now and understand the differences as an employee.
If you're not in California, change is less known. I think that eventually the delivery gig is going away. It will either be forced or voluntary. But that's my prediction. What would it look like in your state? Here's a list of minimum wage rates for tipped employees state by state. California is a bit of a best case scenario for tipped employees at $12 per hour. A bunch of states are at only $2.13. That's night and day, folks. Search for auto reimbursement policy for employees in your state.
In some states, an employee status could be better. Other states, not so much. Which is it for you?
Yep. Another link in the headline.
What happens if you are in California, you kind of like what being an employee would mean, but then when they go through the hiring process they don't hire you? Now what?
What happens if you are in California and you don't want to be an employee for any reason at all?
What happens if you are in any other state and these apps either close up shop because the business model no longer works, OR they decide to switch to an employee model nations wide?
Now what do you do?
Do not wait for the last minute to figure out what to do. Start thinking about what you would do next. Start planning where you would love to go with your life.
And start figuring out how to get there.
Even if nothing changes about this gig work, do this. Your life will be so much better.
Think about all that soul searching.
What's important to you? What are you passionate about? Did you start thinking about what you would love to do more than anything? If you don't know, how can you start finding the answer to that?
Remember your why. Remember what keeps you going. How can you put that to work? Is there something in that why that you can earn a living with?
Are you one of those people who want nothing to do with being an employee? Folks, just because they take the employee option away from delivery gigs, that doesn't mean your independence, freedom and flexibility have to go with it. Maybe this delivery stuff is your gateway drug into full blown entrepreneurism. Maybe you love the independence because you were build to run your own business.
If you're catching that business owner bug, start getting ideas. Look up people like Gary Veynerchuk, Pat Flynn, Dan Miller. They have so much material out there both written and on podcasts, and a lot of it is free. Swallow up their content, someone out there will inspire you. Search for podcasts on entrepreneurs – one place to look is Entrepreneurs on Fire. These are just a few. Get inspired, there's so many ideas out there that you can delve into.
Start dreaming. Start asking the question that I was asking not all that long ago: What do I want to be when I grow up?
Once you start figuring out what you want to do, find out what you have to do to get there, and do it.
Do you know what an incredible resource we have as couriers? Time! You're driving to the restaurant. You are waiting at the restaurant. You're driving to the customer. You're rinsing and repeating. So. Much. Time.
People!!!! You can be paid to prepare for what's next. I kind of wish this were in podcast form, I'd be shouting into the mic. Do you know how much free information is out there in the form of podcasts? How much inexpensive information is out there in audio books? There is so much out there that can inspire and educate and prepare.
Are there other things you can do to get where you need to go? You've got maybe the most flexible freaking form of raising money right now in the world. Take advantage of it, work around whatever you have to do to get where you want to go.
Do it. Not to sound like a footware commercial, but… git er done.
AB5 isn't the end.
It's a change. Maybe it's a change you won't take part of because of whatever reason. But it's not the end.
Just don't be unprepared for the change.
And more than anything, let this be the beginning of something far better.