Along the east coast of Australia, from the Gold Coast to Melbourne, American film studios and production houses are opening up for business.
It’s true that they are enticed across the Pacific by favourable state and federal government support programs and, in addition, Australia is relatively free from COVID-19 compared to the US.
But there is a deeper and more fundamental set of forces in the US that is driving film makers out of California. It’s bad news for the US and, potentially, great news for Australia. …
Unions often demand a monopoly on the supply of labor. The monopoly aspects of unions is their bad side.
For decades the US union movement was aligned to the Democrats, but the Democrats turned their back on the unions, fostering massive job destruction as manufacturing was shifted to China in the Clinton-Obama era.
Donald Trump in his 2016 presidential campaign told the unions that he would deliver the jobs back to the areas where they had been lost. And for the most part, prior to COVID-19, Trump delivered much of his promise. But he also turned his back on dealing with the unions and they became dangerously frustrated — even doublecrossed.
At the same time, the Democrats realised that to unseat Trump they would have to do a deal with the unions. The unions played hardball but their requirements were embraced by Democrat presidential nominee candidate Bernie Sanders who played his cards brilliantly. He pulled out of the race on condition that Joe Biden embraced the union requirements. And Biden is honouring his undertaking — and fast.
Late in 2019 the left wing forces, who were in control of the California legislature, passed the so-called AB5 act to ban most forms of independent contracting in 2020. The ban severely disrupted California and caused many IT companies to look elsewhere in the US because the whole basis of their operation revolves around independent contracting of skills that are not required 365 days a year. The Uber delivery service was endangered.
A referendum held at the same time as the presidential election saved Uber but other Californian industries remained endangered and there has been a scramble for exemptions.
Both film makers and IT groups revolve around contracting. People are employed to undertake a specific task and may work for others at the same time or alternatively when the task is completed they look for a new contract with the same group or a different group. There is no employment relationship. …
A key part of [Biden’s] so-called PRO Act legislation, now before the Congress, is the abolition of most forms of independent contracting, which unions hate because it usually cuts them out of the action. In effect the Californian ban is being extended across the US.
But the PRO Act goes much further and it gives unions a great many new rights. In Australian terms some would be regarded as rights that unions should have, but others will effectively give the unions the opportunity to run the workplace. And, of course, whereas many Australian managers have come to understand how to work with unions, Americans have not had that experience because the union movement is relatively small outside the public sector.
Accordingly that’s going to make running American businesses a lot more difficult. US film makers in Australia have already discovered that our contracting rules are clear and akin to what America used to be. …
If they find it easy to operate Down Under then word of their success will spread throughout the IT industry and other sectors. …
The UK is wrecking contracting too:
In the UK independent contracting is also a mess and is mixed up with taxation regulations. Many UK IT operators, like American film makers, are looking to take some of their operations abroad. Their first port is normally India but we need to raise the Australian flag so we also become considered.
Interesting how national politics increasingly have international ramifications.