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ADISA's Policy Statement: Protecting the Right to Organize (PRO) Act

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ADISA opposes H.R.842/S.420. ADISA further believes that any legislation seeking to change the definition of “independent contractor” would cause significant harm to the independent financial services industry and, at the very least financial services professionals should be exempt.


H.R. 842/S.420, the Protecting the Right to Organize Act (“PRO Act”), expands employees' rights to organize and collectively bargain in the workplace. The PRO Act expands the definition of an ‘employee’ for the purposes of forming and joining a union so wide that most Independent Contractors (1099 self-employed workers) working in financial services will be included in the new definition. In so doing, The PRO Act will diminish, and even potentially eliminate, the use of Independent Contractors.

In addition, the PRO Act would permit labor organizations to encourage participation of union members in strikes initiated by employees represented by a different labor organization (i.e., secondary strikes) while simultaneously prohibiting employers from bringing claims against unions that conduct such secondary strikes.


Independent contractor arrangements are commonplace throughout many industries including financial services. The Independent Contractor model generates substantial benefits for both workers and employers, including flexibility, reduced fixed costs, independence and freedom for workers to operate their own business. However, perhaps most important is that the Independent Contractor model benefits retail investors: it enables the proliferation of independent advice, and increases the availability of and access to multiple products and services beyond ‘captive’ products offered by a single firm.

Reclassifying independent contractors as employees would have devastating effects on the alternative investment industry, which would, in turn, ripple into countless other sectors that ADISA members support. As many as 64% percent of all registered representatives operate as self-employed independent contractors. The elimination of many of these independent professionals would undermine the safety and security of retail investors who benefit from the independent advice, varied products, and breadth of services provided by so many financial services professionals.

Independent financial services professionals have a long history of working with the financial services industry. This business model provides retail investors multiple alternatives to secure their financial future. So too, the Independent Contractor model provides Americans with the freedom and choice to establish their own business independent from large financial institutions. The business model enables financial advisors to create relationships with multiple firms and offer multiple options to their clients. As Congress continues to evaluate H.R. 842 & S. 420, we hope that it pays close attention to sections involving independent contractors and not reclassify the definition of 1099 workers, to the detriment of our industry and the families and economy we serve.


The Alternative & Direct Investment Securities Association (ADISA) is the largest U.S. trade association in the alternative and direct investment industry. ADISA is a national trade association of professionals involved in primarily non-traded alternative investments. We provide educational and networking opportunities for our members, and we actively lobby for our members’ interests on Capitol Hill, and in meetings with lawmakers and regulatory agencies. Founded in Indianapolis, IN, in 2003, ADISA has grown to include 4,500 key decision-makers who represent more than 220,000 professionals, including sponsor members that have raised more than $200 billion in equity and serve more than 1 million investors.

For more information, please contact John Harrison, Executive Director: