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Comment by hammock | Hacker News Reader

>I was curious about what drivers think. I guess they're not happy [1] but want to be independent contractors still [2].

If the employers don't want the change...

and the employees don't want the change...

and the customers don't want the change...

and the shareholders don't want the change...

and the residents of California don't want the change (exhibited by the threads yesterday with outcry over the decision to shut down)...

Why is the government of California trying to force the change? Is this a breach of the social contract?

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I'm not a resident of California (rather, Minnesota), but I do want it to change. I don't use gig services because I think anyone doing 40[1] hours of work deserves a wage they can live off of, along all the other employment protections we've worked so hard to implement. Gig services are cheap because they don't meet that requirement. If gig services were required to meet that minimum wage and workers' rights, then I would be very happy to use them.

[1] Negotiable.

And where does that "enough money to live off of" come from? Unless the company has a lot of fat to trim, it has to come from customers in the form of higher prices, or from investors throwing more cash onto the bonfire. What happens when customers would rather not use your service than pay the amount whatever you're proposing takes?

It's very possible that this market only exists at the size that it does at a price that doesn't support what people in the US think of as "a wage they can live off of", and that by mandating more compensation, then there will be a whole lot of drivers for whom this just isn't an option anymore.

That said, I think drivers should be able to set their own prices, and that there should be a real market with bidding, but the UX will probably suffer.

> Unless the company has a lot of fat to trim, it has to come from customers in the form of higher prices, or from investors throwing more cash onto the bonfire.

Nope, there's lots more options than that. Cut executive pay. Tax high earners more and provide social services like healthcare and public transit, to reduce cost and demand on these services. And yes, prices would likely go up, because they're no longer being subsidized by gov't welfare.

> It's very possible that this market only exists at the size that it does at a price that doesn't support what people in the US think of as "a wage they can live off of"

Then the market is exploiting labor and is being subsidized by the welfare system (else the workers couldn't live, by definition). If we're going to subsidize unprofitable activities, we should do that as a society, not by funneling cash to Uber's owners.

> Cut executive pay

This doesn't really work when Uber has something like 3 million drivers worldwide. Distributing the CEO's entire salary among drivers would yield them only a handful of coins worth of extra income per person per year. There's simply no way to translate exec pay into meaningful comp for drivers at this sort of scale.

I do, however, believe it's possible for the government to establish better social services (e.g. universal healthcare at similar tax rates exists just north of the border) if only the US govt adjusted its spending priorities.

I ran the math a while ago. If Uber CEO worked for free, the salary saved amounts to 1 or 2 cents per ride.

>Nope, there's lots more options than that. Cut executive pay. Tax high earners more and provide social services like healthcare and public transit, to reduce cost and demand on these services. And yes, prices would likely go up, because they're no longer being subsidized by gov't welfare.

Executive pay, etc was what I was referring to as "fat". But what fraction of Uber's expenses do you think executive pay makes up? This is an oft-stated refrain, but anytime anyone runs the numbers, it quickly becomes apparent that those aren't large enough to make any difference across the huge number of employees involved.

I'm totally onboard with the social reforms you mention, but these are outside the purview of Uber/Lyft and this attempt to force them to treat these people as employees.

> If we're going to subsidize unprofitable activities

I must be missing something, how is Uber,Lyft being subsidized?

> It's very possible that this market only exists at the size that it does at a price that doesn't support what people in the US think of as "a wage they can live off of", and that by mandating more compensation, then there will be a whole lot of drivers for whom this just isn't an option anymore.

And that's different from many other hypothetical services how? If we accept that the floor should be lowered it should be for everyone, and if we don't it shouldn't. It should be an even playing field, not something where some companies slip through by not employing their workers.

You're right, I don't think they should exist in their current form, they don't seem to be viable without near-monopoly pricing power anyway. I'm just saying this because people act like we can just mandate that companies pay more, without mentioning that it's probably going to mean that those jobs just won't exist. There's a reason taxis were a niche service in most parts of the country - people haven't historically wanted to pay what they cost outside of eg going to the airport. Which means that almost all those people everyone is claiming to act on behalf of are probably going to have to find something else to do for money if Uber is forced to take them on as employees with full benefits and high wages.

If you don't use gig services, will the gig workers become employees and make more money? Isn't it just as likely that the services will go away and the gig workers will not have a source of income at all?

Serious question: is your main complaint the low pay, or lack of benefits? If Uber increased pay to an average of $30/hour after expenses but still treated them as contractors and told them to buy their own health insurance, would you be ok with that?

Both. I'm not an employment law expert, but things like mandatory breaks, working conditions, PTO (pa/maternal leave, etc.). If you work a full time job, you are entitled to a comfortable life with a healthy work/life balance.

Am I misunderstanding, or are you saying that freelancing and independent contracting should not be permitted under any circumstances? Is there no sufficient amount of money where you'd acknowledge that workers are not being exploited in a fee-for-service structure?

And what about small business owners, who effectively have zero paid leave or vacation?

> are you saying that freelancing and independent contracting [and small business owners] should not be permitted under any circumstances

It's a good question and I'm not sure. I think my answer is some weak form of "yes." My goal is to enforce a good work-life balance, I think society benefits from a healthy workforce. So they wouldn't be impermissible per se, but they should meet those same requirements. However, obviously that's really hard to enforce for a contractor type situation, and some people genuinely thrive in their jobs in a healthy way. So, I don't know what the right balance is. I believe France has some mandatory maximum work hours regulations. Those might be interesting to look into.

I know some will argue this point, but I really do think it's clear that gig workers don't fall into those two categories, regardless. The power dynamics are totally upside-down between traditional independent contractors and SBOs, and Uber/Lyft drivers.

You've lost me now. You've gone between multiple topics and I don't really understand what your stance is. Are you saying:

- There should be a limit on number of hours worked (regardless of type of employment).

- Everyone should be an employee, and not a freelancer or otherwise independently employed

- Everyone should get benefits

Or all 3? Those are all to me at least independent things. You can have work hour limitations as a contractor or you can be an overworked employee.

> - Everyone should get benefits

Yes.

> - There should be a limit on number of hours worked (regardless of type of employment).

I'm not getting into the specifics, my point is everyone should get the worker protections we have developed over the decades. If that includes mandatory time off, great, but it doesn't have to. I pointed to France's model as one potential example of how it might apply to non-employees like contractors.

> - Everyone should be an employee, and not a freelancer or otherwise independently employed

I don't care about the categorization so long as the worker protection regulations are being met.

What about small business owners? If I open a restaurant I can only work 8 hours a day 5 days a week? I need to take 3 weeks off a year?

> So, I don't know what the right balance is. I believe France has some mandatory maximum work hours regulations. Those might be interesting to look into.

I never thought I would see the French system pointed to as a potential example. If you’re talking about the 35h week keep in mind that it is a really contentious topic there!

I wouldn't use France as a model for economic regulations. I love the country, but its economy isn't one of its strong areas. Ironically, many companies in France primarily hire contractors now because of the many onerous regulations around employees. One of Macron's big pushes has been to try to make the French economy more competitive by stripping some of that out, but it's obviously been controversial.

Also, why should a bureaucrat tell me what the appropriate work-life balance is, as an independent contractor? I'll decide that balance for myself, based on my life situation, thanks.

> Also, why should a bureaucrat tell me what the appropriate work-life balance is, as an independent contractor?

Because otherwise it tends to be a race to the bottom.

The highest leverage way to help low income people in California is by focusing on reducing the cost of being alive. High barriers to earning money will just continue the decades long out migration of low income workers.

In California, if they cared about that, they could move that needle with housing policy, and nationally, with an immigration program that focuses on high end talent (such as H1B’s), letting low end wages lift up. That’s a real bouyancy that would make Uber drivers better off.

“Employment protections” are not important at all for workers’ prosperity. Just imagine if they were absent. The most marginal workers would be better off.

Drivers now set their own prices. Then it is the same as setting your own prices to teach piano to kids?

Set your own price higher then

Do you also not eat at small independent restaurants? The owners also don't meet the same requirements, and in many cases make even less than uber drivers.

>and the residents of California don't want the change (exhibited by the threads yesterday with outcry over the decision to shut down)...

but didn't they also vote in favor of AB5? I'd take a referendum result over a non-uniform sampling of people's opinions.

edit: nevermind. AB5 wasn't a referendum, so citizens actually didn't get to vote on it.

No, the referendum is this November (prop 22).

Supposedly driver's unions lobbied the state government to make this change. So it's a vocal minority that's speaking on behalf of the majority that didn't want to join a union in the first place.

I think the idea is that we're in a local maximum for "how good is the current arrangement for society as a whole". Any small change to the arrangement is going to make things worse for one party or another, and probably even make things worse for society as a whole. But there's a chance that a bigger change could get us to an even higher maximum, where everyone is better off, both individually and on net.

It's hard because you can't just jump there, there will be some people or entities that are worse off during the transition. Also there are unintended consequences so things might not go as you expect.

Usually to (attempt to) make changes like this, it has to be a government doing it, because it's a coordination problem and you have to force people to look past their short-term self-interest for a little while.

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