U.S. Labor Secretary throws support behind classifying gig workers as employees
reuters.com
reuters.com
The legit concern is whether Uber or any other freelance company misleads its gig workers on their earnings, and to me the best solution to that is not to force reclassify them as employees or prohibit gig work, but to regulate transparency in compensation. For example, require freelance employers to include expense tracking and calculate workers earnings after expenses. That by itself would fix most of the problems for the percentage of gig workers who don’t realize they’re extracting depreciation from their car more so than getting paid by Uber.
The other issues of healthcare, etc., the US needs to solve at a societal level, not an employer level. I think humans have a right to health care. But I don’t think people have a right to a particular job, nor an entitlement for that employer to provide a particular mix of benefits.
This idea that we need to provide our social contract / safety net exclusively via employers is so strange to me, compared to simply owning that if we want these to be rights of our citizens then the government should be providing them as tax-paid services.
Look at the current situation where there is a 50-50 tie in the Senate, but existing rules create a 60 vote threshold for most legislation. There are a whole lot of issues that I'd like to see reform on, but right now the votes are not there for either party to do so.
Effective lawmaking is not some impossible feat under our current system, it was commonplace until very recently. All that has changed is that we've grown complacent and now continue to vote for those who refuse to do their jobs.
What's not OK is when the company wants all the advantages of having contractors but still wants to dictate all these things.
What does set your own hours look like? If I hire someone to mow my lawn, and want it to happen while I'm at the store, am I setting that person's hours?
What does decide how you want to do the job look like? If I specifically want them to use an electric mower for noise reasons, am I deciding how they do the job for them?
Ultimately I feel like we are trying to shoehorn a fundamentally new model into preexisting paradigms, and as a result we waste time haggling over who is what. It feels like instead we should just say this is a new thing, and create a new set of laws to regulate it in the way that we think is best.
> If I specifically want them to use an electric mower for noise reasons
The fundamental difference is you, as a customer, can want these things, but the person doing the mower is self-employed and they can negotiate and figure out whether or not they can come to a mutual agreement with you. They could also just simply not come to an agreement with you and the worst that would happen is they don't get your money, and move on with their work and life.
It's different than if there was Uber Mowing Co. that managed them and forced them to forgo their lunch and mow your lawn while you were at the store or be fired.
These two things are in fundamental conflict, which is part of the issue.
Are you even hearing how ridiculous this sounds.
But I don’t think your examples are relevant. The customer should be able to request as much as they want on the gig worker, as long as there is no middle man employer forcing the worker to agree to subpar conditions.
I don't think it's that clear - it's more like people are still arguing about a) is it really a new paradigm and b) if so, is it on net enough benefit to be worth doing.
Generally, contractors should have expertise, use their own equipment, decide how the job should be done, and have a risk of losing money.
If you insist they use your lawnmower, that's a very quick employee classification (from what I've experienced). My gardener refuses to use any soil/mulch/whatever we own - likely for this reason. I've worked with real estate folks, and when they do a flip, they're very careful not to buy raw materials for the contractors lest some of them sue to be classified as an employee and collect benefits. They'll even use SW to set up an order with Home Depot, which emails the contractor's a simple way to place that order at HD and pick up, and then they'll ask the contractor to add the raw materials cost to the invoice. But they will not buy the materials for them.
Also, if I screw up my current job, I'll merely get fired. My employer cannot demand I repay wages (generally). If your situation with your contractor is comparable, he will be classified as an employee. They must take on risk of losing money if they negotiate poorly or screw up a job.
> It feels like instead we should just say this is a new thing, and create a new set of laws to regulate it in the way that we think is best.
I don't think anyone is disagreeing with this.
In WA State (https://esd.wa.gov/employer-taxes/independent-contractors), there is a three part test. If you force someone to mow your lawn with specific equipment, and at a certain time, they would be en employee; they are not free from control.
When I order an Uber I can never get a ride from a 1980 Ford truck or a snowmobile because those vehicles don't meet Uber's standards and I'm actually scheduling a gig with a representative of Uber who adheres to Uber's standards and acts in line with Uber's policies and takes pay from Uber that is disconnected from what I pay them. There is virtually nothing "independent" about the driver except they independently chose to work for Uber. Yet the driver still bears the costs of equipment maintenance and liability, which happens to be the exact costs that business newbies overlook the most. It's exploitative.
The important thing is them passing on not doing your job won't affect their next one, unlike what happens if an uber driver declines too many rides.
Personally, I think OP is calling out that most of the issues with current Uber (and similar companies) is the asymmetry of information. Only Uber knows where all the riders are, what they are paying, and where they are going. They also are the only ones that know where all the drivers are and how much they are expecting to be paid. This information asymmetry allows them to expose just enough information to both rider and driver to facilitate the outcome Uber wants. In my mind, when Uber (or anyone else) starts controlling the flow of information they cease to be simply a platform/market place.
The majority of issues (in my mind) resolve themselves when this data asymmetry is removed. Driver's have more freedom of choice if they can see all available fares rather than just a yes/no prompt on an individual basis, for example.
I also think there is far more gray area to these types of employment relationships that is generally acceptable when it comes to things like how you do the job, how you dress, etc. For example, if you are an independent delivery driver but enter into a contract with FedEx it is acceptable for FedEx to stipulate that you wear a FedEx uniform while delivering FedEx parcels. If you don't find that stipulation acceptable, you can decline the contract. Likewise, if FedEx discovers you aren't following contractual obligations they can terminate the relationship.
Majority of tech contractors are actually employees of contracting company, so that is one way to get around it. At one point, I was freelancing, and I had only one client. My/their accountant had me open an LLC for this reason.
Now there are a lot of gig workers who are on all of the platforms and probably earn equal amount of money from each platform. But there are plenty who are only on one platform, so they will need to be classified as employees.
(new account, long time reader, victim of poorly self-managed passwords)
The man heading state labor policy is a "product" of the labor movement. Is that supposed to be a scandal?
> easier for the AFL/CIO and Teamsters to unionize them
Good.
If unions aren't doing that because they are compromised or sclerotic or whatever, then they aren't much use. Who would argue.
It is a good thing for the leader of a government department to have ideological goals broadly aligned with the mission of the institution.
Should that be up to the freelancer? Ever Uber driver I’ve ever known knows their costs down to the cent. That’s what freelancing is all about.
What would be more valuable is required financial literacy courses as a condition of high school graduation. And restricting predatory student loans. But the Big University lobby would stomp that effort out quickly. Education has had higher inflation than even health costs — due almost entirely to the funny money from essentially unlimited student loan availability.
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There are also lots of Barbers who have to basically come in at certain hours to keep the barbershop open. Barbers however, are largely "gig" work by technicality. You're technically an independent contractor.
Etc. etc.
These sorts of positions are only "gig" because the companies are exploiting those workers. You really can't choose your hours in sales and/or barbershops. You gotta come in when the customers come in. You gotta close up shop and/or open up in the morning, (kinda like open / close employees / managers).
But they're "gig" because the companies want to avoid paying social security taxes, among other taxes associated with proper employment.
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Freelancing probably is a "proper gig". That's not the segment of the economy that people are talking about. There are true gig workers. And then there's the huge number of "non-employee / gig-work" where its just a collection of companies avoiding social security taxes.
Employees are taxed 6.2% by the government, and 6.2% to the Employer.
Gig workers are taxed 12.4% by the government ("self employed" tax). So in US-law, the government gets its money either way.
That's why a "gig-worker in name only" is such an advantage to companies in the USA. It allows companies to cut out 6.2% of its taxes and shove it to the gig-worker instead.
Gig worker sees the whole .124, which is probably why govt wants more classed as employee.
TANSTAAFL
There ain't no such thing as a free lunch
that extra 6.2% isn't a tax on the employer at all! it is a tax on employment, and it really is part of the employee's taxation (in fact that 2 * 6.2% is a "socialized" part of the employee wage, that fraction of wage goes to the Social Security Administration to be put in a fund used then to pay out retirement pensions). Hiding this fact is the best part of tax: a tax you do not feel is the best kind of tax from the point of view of the tax collector... of course it is the worst kind of tax from the point of view of the taxed entity.
"Gig worker sees the whole .124, which is probably why govt wants more classed as employee." <-- that's right! however one could argue that everyone should see the whole .124 so that they know better how they are taxed (I'm not saying this level is too high, on the contrary I think it's too low, but what irks me is that it is done under the covers...).
That doesn't make a lot of sense when the employee still has to pay the tax. Nobody is avoiding it. The claim that employers pay half is just a feel-good claim with no economic basis.
There is no real difference between paying $10.62 to a contractor who has to pay $0.62 more in social security tax and paying $10 to an employee and $0.62 to the social security administration. And the employee would (all else equal) choose a job paying $10 as an employee over a job paying <$10.62 as a contractor, so the companies hiring contractors have to pay that much more or offer some other countervailing benefit to be competitive.
Except the ads posted in your local bulletin board / signposts are "Want a job for $10/hr?!??"
So what happens in practice, is that the gig-worker is paid $10 (costing the company $10), vs the employee who'd be paid $10 (costing the company $10.62 + other bits, like health care and various insurances)
Give people some credit. The education system isn't perfect but people can do basic arithmetic. Or if they can't then maybe solve that instead of this.
Why not both? If a problem is identified with our culture, its not exactly a strong argument to say "Well, here's another problem I'm more concerned about".
All I'll say is: lets solve both problems simultaneously. There's many problems in the world, and we should work on solving as many of them as possible.
I've got friends (who were with me in that knife salesman gig work) who didn't understand the difference at all, no matter how many times I explained it to them. People's brains just don't work the way you say. Sure, I understood the difference and how to do my own taxes, but not everyone has that capability unfortunately.
Because they're alternatives to each other. You don't need both.
If people don't understand how to compare their alternatives, they're going to get screwed left and right, not just in the difference between employee and contractor. So we have to fix that more general problem if it exists.
And solving that problem means not only that you don't need to prohibit people from being classified as contractors but that doing so is a net harm. Because prohibiting it for the benefit of the person doing the math wrong (solvable the other way) is a harm to the person who benefits from the arrangement, e.g. because they want the more flexible hours that come from being a contractor instead of an employee.
Sure we do.
Our education system sucks (as proof by my friends who were unable to grasp this basic arithmetic). AND we have a Gig vs Employee issue that also needs to be clarified through the law.
Lets fix both. I don't see any problem working towards the problem you suggested, nor the problem I suggested. I'm sure our failure in education is also causing issues in other aspects of our society unrelated to this particular issue.
Fixing the education system solves both of them, because then people aren't fooled into becoming a contractor when it doesn't benefit them. Then you don't need the government to force them into being an employee including in cases where they're better off as a contractor -- you only need to do the first one.
Also, if you tried to explain it multiple times to them, maybe it isn't the education's systems fault? Like you said above, their brains are unable to grasp it. No amount of education reform is going to fix that.
Can you expand on this? Is it that employers don’t really contribute an equal amount to the employee withholding? Or is it an acknowledgment that absent this withholding, one would expect the money to show up in the regular paycheck?
Which means saying that the company pays this amount and the worker pays that amount doesn't really mean anything. In the case where the worker nominally pays less of the tax, the company doesn't have to pay as much to the worker to make the job equally attractive. It doesn't really change who pays.
Of course this is theoretical and real systems have friction and stupidity in them, so people who are lazy or bad at math may end up taking a worse deal because it was framed in a particular way. But that's an information problem -- it has information solutions.
Instead of spending all this time campaigning to classify people as employees, just send out pamphlets to all the Uber drivers with a cost breakdown of what the equivalent employee wage would be compared to what Uber is paying them. Maybe some of them will quit and then Uber will have to pay the others more. Maybe the people doing the job aren't as dumb as they're made out to be and have their reasons. Either way, you solve the information problem with information, not prohibition.
Source: I like to get to know my barber's and every shop was run different.
In my small shop of guys, we ended up having to all independently form our own corporations just so that we can share work amongst eachother to better serve the various clients we each bring in without having to do stupid things like write 3 separate contracts with the client. We don't meet the new ABC test because we all perform a similar scope, so whereas before, it was trivial to just write a 1099 for eachother at the end of the year, now we have to have all the corporate infrastructure which is a huge PITA.
It's not unlike the gun laws in CA... People that don't like guns and know nothing about them write meaningless and often incredibly arbitrary legislation that doesn't address the problem they are really meaning to address but makes things a pain for everyone else.
So, I don't really buy the argument that these types of complaints should just be dismissed. The reality is it's really hard to target "gig" work very specifically without roping in a BUNCH of other contractors that aren't really of interest but will have to comply with the law anyway.
If the worker does a good job does that impact their marketability -- enable repeat customers and advertising for them specifically (such as via word of mouth) or does it reflect more on the company they are "contracted" to?
In the case of Uber and Lift and Instacart, the platform practically prohibits customers from preferring certain providers that have provided good service in the past, so all of the reputation goes to the platform provider. Things would be a lot fuzzier if these platforms provided matching services and would depend on how competitive these markets effectively are. The market for transportation from point A to point B with pickup in the next 10 minutes is inherently limited by providers that can be at point A in the next 10 minutes, so this market may not be competitive for all sources and destinations.
In general, contractors should not be interacting with their hiring company's customers on the company's behalf. Only employees should represent the company, since the benefits of those interactions reflect on the company and not on the worker performing the interaction.
This is the big problem that no policymaker wants to address, because there is a huge amount of money being made off of the status quo. And decades of bad-faith "big government" rhetoric plus "starve the beast" policy have soured the public on it.
The people trying to pass things like Medicare for all would disagree with the “no policymaker” part. Not a majority but they exist and are generally vocal about mentioning this exact point.
Just wanted to note that there are systems which are not tax-paid and still avoid the problems that you have in the US.
E.g. in Switzerland health insurance is private, but the variables that can be used to determine the price are regulated. The employers cannot directly provide health insurance as a benefit (some provide a cash supplement, but that's effectively a higher salary). This way big companies don't get preferential treatment. You can be a freelancer and have the exact same health insurance as people in big tech.
We came up with this agreement as a society that people should be able to survive and have their basic needs met, and then we forced businesses to actually make it happen through minimum wage (and to a lesser degree insurance, pre-Obamacare). If we came up with it as a society, our society (as represented by our elected government) should be the one actually charged with making that agreement a reality.
I suspect this instead leads to companies determining "nobody is willing to work at the prices we're happy to pay. Therefore there is a labour shortage; we need more immigrants, and we're happy enough to sponser them for a time"
Note they don't raise prices, they instead increase the applicant pool.
Boss makes a dollar, I make a dime, that's why I shit on company time. If I got paid fairly and had a seat at the table for discussions about profit sharing then I would plan my shits to not impede my work. Until then, big capital can keep blowing their hot air, workers don't care what these suits think and are realizing the suits don't even care about the health of safety of the workers themselves, let alone their ability to afford a family or house.
If UBI helps people do useful things like caregiving or job training, then it has achieved something.
If UBI just causes less (useful) work to get done, then it is a net harm to society.
Maybe it's good if it shifts investment towards automation that eventually improves productivity. For example, if paying Uber drivers becomes less attractive, maybe researching self-driving or investing in mass transit becomes more attractive; maybe that's good.
But things still need to get done, and money by itself doesn't do anything. In the extreme case you end up like Kuwait, where citizens get (in that case oil) UBI, and guest workers outside the UBI system do all the actual work.
The US could do that, and it might reduce inequality among US citizens, but new outgroups would become painfully apparent.
You're not setting your own rates. You can't choose which rides you take. You can't follow your own rules.
Remember when Uber was giving back to back rides to drivers that had Lyft driver app installed so they couldn't effectively drive for both? That doesn't sound like freelance work to me.
Much of the pay structure is based on hitting a certain number of rides per week. So to get "decent" pay rate you need to work a certain number of hours.
Sometimes the company even owns your car and leases it to you contingent on doing a certain number of rides.
And you have no input on which rides you get once you go online.
It's nothing like traditional freelance work. It's more like high tech pizza delivery driver. And those workers are all considered employees.
> You're not setting your own rates. You can't choose which rides you take. You can't follow your own rules.
As of a few years ago you can choose which rides you take without penalty. This is effectively how you negotiate rates as well. Only drive during busy times and accept high rate rides.
> Remember when Uber was giving back to back rides to drivers that had Lyft driver app installed so they couldn't effectively drive for both? That doesn't sound like freelance work to me.
The back-to-back ride thing has nothing to do with having the Lyft app installed or not. It's a great feature that allows you to have your next ride lined up while on the current ride. It dramatically increases profit and efficiency (which also means less dead-miles -> less gas wasted -> less emissions). You can decline these "back-to-back" rides just like any other ride request.
> Much of the pay structure is based on hitting a certain number of rides per week. So to get "decent" pay rate you need to work a certain number of hours.
If you drive when it's busy the incentives don't matter. My take home-profit (even after depreciation of vehicle) is $15-30/hr for about 20 hours per week.
> Sometimes the company even owns your car and leases it to you contingent on doing a certain number of rides.
I don't know any Uber drivers in my city who lease their cars from Uber. Never heard of this happening.
> And you have no input on which rides you get once you go online. You get all the ride requests near you. You can decline at will with no penalty.
Apparently, that was harming Uber’s business and they are considering removing that feature from the driver app.
https://www.sfchronicle.com/business/article/Uber-may-stop-l...
That wasn't there before and I have no reason to believe it now without evidence. Turning down rides always had negative effects such as less rides being assigned to you.
> The back-to-back ride thing has nothing to do with having the Lyft app installed or not
You should look this up in older news articles. AFAIK that's just not true. Maybe it's changed, but at one point Uber was changing their app behavior when you had Lyft driver app installed.
> If you drive when it's busy the incentives don't matter.
So you're implicitly agreeing with me that the incentives are perverse and encourage you to drive during peak times?
> I don't know any Uber drivers in my city who lease their cars from Uber. Never heard of this happening.
Then I encourage you to read about this. There's a large fraction of people who don't believe anything unless it's happened to them or their friends personally. And I think this is a shame given how available information is with today's internet. This definitely 1000% happens. I've seen it with my own eyes.
Freelancers doing gig work are a drain on society if they fall back on to social safety nets when not employed. It's not in society's interest to have these people paying taxes only when they feel like it, especially if it ends up cannibalising slightly less efficient industry which reliably keeps people employed and paying taxes.
Not entirely serious - I do have sympathy for the position that gig work puts otherwise idle labour to good use - but I do think Uber and many similar companies are extracting efficiencies that hadn't been locked out with laws only because the tech to extract them hadn't been invented yet, a kind of regulatory arbitrage on a functional status quo.
In response to your second paragraph, regulatory arbitrage is efficiency seeking. I'm sure you're familiar with the phrase "vote with your feet". It's not like people move to a new job out of a state or out of country with the expectations that the laws remain same. In a similar fashion, Uber isn't obligated to base it's behavior on laws or regulations that don't exist. The same could be said of Paypal, Youtube, AirBnB and more recently with cryptocurrencies and NFTs. The way you phrase your sentences seems to suggest you classify pursuing economic freedom as a preemptive regulatory evasion.
This is completely irrelevant. I'm talking about policy-making. I'm talking about the motivations behind making the rules, not how you work within the rules.
> regulatory arbitrage is efficiency seeking
That's right. I think that's what I said.
> economic freedom as a preemptive regulatory evasion
No, but policy-makers are free to take that approach, because they create the rules. If the rules don't cover new behaviour, the motivation - the original political will - behind previous rules often, and in fact usually, creates political will to introduce new rules. That's ok, it's the system working. It's why we have governments on an ongoing basis, and don't just stop once we have one set of laws.
Instead, platforms like Uber dictate rates, dictate how, where and when the work gets done, and penalize workers if they don't take the clients Uber wants them to take. Uber even dictates what cars they can and can't use.
So the workers can negotiate when, how and for how much they'll work for their clients? I've got an '01 sedan collecting dust, can I decide that's how I'm going to pick up my clients via Uber?
When I worked as a contractor, it didn't matter that I used some shitty laptop or OS to get my work done, because I had the freedom to decide how and where I completed my work. Workers using Uber are denied that freedom.
This isn't a reasonable comparison. Your shitty laptop or OS was likely not part of the product. If I want a website I don't care what your laptop looks like. If I am being driven somewhere I certainly care about what condition the car is in.
If a client hires me to build a web app, I get to decide how, when and where it is built. That means I get to choose if I use, say, Django or Rails on the backend, and maybe React on the front end. These are certainly part of the product.
If I started "Daniel's Ruby Shop", collected money from clients, and paid it to you if you made Ruby websites that met standards I set, and required you to Skype me at specific times or forever be banned from "contracts" you're not an independent contractor, you're my employee.
No thats not really true, for all cases of contracting.
I, as the client, could absolutely tell you to use rails, and if you don't use rails, I can "fire" you the contractor.
Sure, some clients might not care. But some would care, and they can tell you want to do, and control what you use, and not work with you if you don't do what you say.
Right, so sounds like Uber sensibly wants their representatives on the street to project their desired corporate image.
Thus, employees.
That said, I'm not really sure what the solution is. If drivers that drive more than X hours per week have to be employees, I wouldn't be surprised to see Uber attempt to limit hours for each driver.
There are millions of part-time employees in the US who choose their own hours.
The fight here is not about whether Uber should be setting the hours that their drivers/employees work it is about: 1. Who pays the relevant employment taxes 2. Do the drivers qualify for state/federally mandated benefits like time off, unemployment, workers comp, etc.. (note: all of those things cost money, plus time to administer) 3. Do they come under rules about treating all employees the same (e.g.: do drivers that work full time get the same 401k program as Uber programmers)
All of this is really about Uber and the like trying to shift costs and burdens away from themselves. In many cases trying to eliminate them from their business model. We as a society have put protections in place against this because we saw how horrible things got, and this is an attempt to end-run those protections. I am open to figuring out how we should re-jigger how we run this, but not like this at the expense of workers.
Uber does not let you choose your clients because they discovered discrimination occurred based on who the client was and where they were being picked up from. You are free to cancel but repeatedly cancelling means Uber will remove you from the network (you aren't putting in anything good to the system...so maybe the system isn't for you)
The work gets done when someone requests it, you don't get to negotiate that as a driver. You are able to look at customers who want future work done (scheduled rides) and book those at your convenience. If you are working in an on-demand contract role, the work has to be done...on-demand.
The ride has to be done in the same way as every ride as that is the expectation of the product. Uber doesn't tell you how to drive, doesn't tell you to set your car up in a certain way, but it does tell you some basic ground rules for doing the work.
Dictating what car you can and can't use is like regulating the equipment on the platform. You can't use 2-door cars, cars past a certain age, and a few completely reasonable restrictions (https://www.ridesharingdriver.com/uber-vehicle-requirements-...)
These are all completely reasonable things to require from a company/customer point of view. It’s completely unreasonable to demand these things of independent contractors.
Large scale marketplaces like this are quite unique and probably deserve a look at how we employ/give work to folks in them.
This assumes that the only solution for Uber is to stop drivers from selecting who they pick up and where they pick up from.
Another would be for Uber to allow drivers to make the choice, but subsidize rides from discriminated areas using money from desirable areas.
It was pretty well known that getting a cab from certain (non-white) neighborhoods and just hailing one as a PoC was very hard pre-Uber.
You could always lodge a complain at the centralized taxi authority where some bureaucrats would input it in "the system". But in the end it achieved nothing. Uber kicking out racist drivers probably did more than decades of complains.
If you need to either be at the edge of the law and discriminate or be the edge of the law and misclassify employees as contractors, to make your business work, then maybe your business model is flawed.
Uber has no inherent right to exist and do business. If the existing laws preclude your prefered business model, you need to get the law changed BEFORE you go into business.
WWE wrestlers are independent contractors yet are instructed to perform certain moves and even deliberately lose matches
Surely it at least means being independent from some of the rules that you have to follow if you have a full time job, or why do it? If it doesn't at least mean setting your own price, then what in the world is the point?
Imagine you are freelancing on a software project but you can't ever make any good money because, strangely, the price you're allowed to charge is set by Stackoverflow and not you. Seems kind of presumptuous of them to decide that for me, no?
I don't understand why so many people in tech will bend over backwards to not notice the most obvious, basic nature of the economic arrangement between these firms and the people who do all the work. Just look at this stuff straight on. It's obvious what it is. Imagine yourself as a worker instead of a boss for once.
There is an Upton Sinclair quotation that fits.
There's the John Oliver's video https://www.youtube.com/watch?v=m8UQ4O7UiDs
And also a journal article in response to the video
Which concludes,
"But in the end, the totality of the evidence is overwhelmingly in favor of wrestlers being more accurately classified as employees."
An Uber driver can certainly decide how and where their work gets done by using the car of their choice, except they aren't allowed to. Uber decides what vehicles they can use.
> Seems to be we're fundamentally trying to force an old classification to a new set of jobs.
There's nothing new about delivery driving and taxis. What's new is that companies are pretending that an app means that they shouldn't have to play by the same rules as every other employer.
This. The cars have a bare minimum requirement to ensure a good passenger experience and for safety (no older than X year of manufacturing, etc.), but beyond that, you are welcome to use whatever car you want. Uber has no issues with letting you use any car of your choice, as long as it meets the minimum requirements (which seem to be pretty reasonable).
I've seen regular Uber drivers (not Uber Black or any other more premium services) pull up in anything ranging from a few years old Priuses to pretty much brand new Teslas and Audi Q-series SUVs.
Each requested ride is a new job. The contractor can choose to not take that job, for any number of reasons.
The fact that the job has a set rate is not abnormal at all. The fact that the client will “punish” you for not being available is also not abnormal at all.
Additionally, the contractors are able to work whenever they want, wherever they want, and for whichever companies they want.
The only real oddity here is that the contract work is dependent on the ride sharing companies. There should be an additional classification for dependent contractors. These drivers are definitely not employees, under any definition.
After all, the defaults have to be set to something, they might as well be set to the current values. You can even have a first launch "Choose defaults" setting.
Then people can go up and down the scale of what they want but no one practically will. And Uber can promise premium service only for things that meet some minimum standard.
Then none of you would get no questions asked refunds and I would. And everyone would be happy.
Many gig workers explicitly do not want to become employees, as there are many disadvantages to doing so. In these cases, the only people that benefit are the politicians that can go on ignoring the real problems.
We want employers to provide benefits, as opposed to the government because that means higher taxes. Then you put a million exclusions and tax deductions and other loopholes, so no one knows what they're really getting, but we can say we did something and that benefits do exist to serve as arguments against broadly, easily accessible benefits to serve as a floor on quality of life.
And what defines a good quality of life depends on who you ask.
I have a chronic condition and for a year the only reason family didn’t end up on street is because of gig jobs. Most days 12-16 hours a day in bed essentially blind in horrific pain. But sometimes totally fine. Disability straight up laughed at me.
Ironically this completely flies in the face of any motion or ‘diversity and inclusion’.
At a certain point I had to stop going to the doctor so I would be able to get enough hours in keep keep the house.
They basically make money buying and selling items occasionally, when they see a deal. That's enough for them to buy all the "luxuries" they want ($5k car, $2k laptop) every couple years.
I think there's a big difference between peoples desires/definition of acceptable and what they put in to obtain them.
And then that's just talking about the structure. What about the location - if a person's entire support system is in one location but the available free housing is 75 miles away and they don't have a car, that isn't decent. This comes up all the time re the affordability of the Bay Area where locals get priced out, someone says "just move to stockton" and the resident feels it's not fair (or "decent") to have to leave where they were born and raised.
You could link location to workplace I suppose but then that would create massive downward pressure on wages since people would be willing to sacrifice pay in order to live where they prefer. This sounds like a net negative.
This question is only hard if you haven't thought about it for more than like 2 seconds.
I can't believe I'm spelling this out. A person picking out their ideal home has trouble figuring out exactly what they want. Ok. We all don't ever know exactly what we want. It's the human condition. But I don't want to live in grinding poverty. I don't need to look within to figure that one out.
I don't want my home to be dilapidated, overcrowded, full of pests and toxins, or to not exist.
If you're still pretending to have a hard time with the definition of "decent," consult a dictionary.
This line of argument is absurd word chopping. "Oh my, I could never in good conscience try to lock down a subtle word like 'decent' into a singular meaning, guess drivers will have to stay earning a sub-living wage forever. Sorry! Definitions are hard!"
No.
What I am arguing against is your baseless assertion that defining "decent housing" is easy, and that everyone who thinks it's hard is simply being obstructionist/anti-poor/whatever.
The closest thing we might have today to an across-the-board definition of "decent housing" might be HUD's FHA standards which -- to your shock and amazement, I assume -- is much more complex than "must be decent"
The current structure treats them as serfs and says what really matters is the efficiency of the overall system, or its ability to generate a profit for its shareholders, or whatever. In short, the problem is these guys work too much in exchange for too little. Whatever theories anybody might have about the market, the role of the state in the market, etc, those are the basic facts on the ground: over-exploited workers seeking dignity where they currently lack it. The idea that they are "contractors," in the way that you or I might be contractors sometimes (I assume you are a tech worker), as experts in a technical field, is a sick joke. They don't have any power to get what they need, in that market, as individuals (they aren't even allowed to set their own prices!). If they could bargain collectively, they might. That's the context here.
When somebody enters the discussion and says, "Well, yeah, but what IS dignity, anyway, when you really think about it, man???" you'll have to forgive me if I don't believe they're doing it out of a devotion to clarifying terms but because they just want to take Uber's side in the fight. Yes, it's obscurantism.
In deeply complex and high-stakes systems, the details matter a lot; I haven't thought about it too deeply but my intuition says that they're the only thing that matters. Unintended consequences (like my salary depression example above) need to be carefully considered. There is inherent inequality built into a naive system like you suggest: an apartment in SF is worth multiples of an apartment in OK, are we alright with that? (don't answer, just an example). The details and their impact are important.
What is 'decent housing' for instance? An apartment in the affordable part of town, shared with 3 room-mates? Your own condo? Your own house in the suburbs? A home in a gated community?
Is 'decent food' the minimum amount of recommended nutrition as defined by the USDA? Or eating out 3 nights a week? Or enjoying prime rib whenever you feel like it?
Is "decent healthcare" a checkup every year? Or a Cadillac insurance plan?
Any combination of these could be called an acceptable standard of living depending on who you ask. It's totally subjective, but the difference between them is tens of thousands of dollars a year.
And how do you define those? I've heard people on here complain that $200k isn't enough for a good life with a family. Yet I make less than half that and pay all the bills for my family. Clearly standard of living and cost of living can have a huge fluctuations on location and what one thinks they are entitled to under a decent life.
For example, a studio apartment in a bad school district might be decent for a single person with no kids. Yet that likely would not meet the definition of decent for a family of 4. Unless, that was a step up from wherever you were living before (maybe on the street). Some people might say they have to eat out or have steaks to have decent food. But others might just want a discount grocery story with freash fruits and veggies with off-brand staples to meet their criteria of decent.
It all depends on people's expectations and needs.
Some –certainly not all– have taken it a step further and offer pharmacare, daycare, a livable minimum wage, and free higher education.
Still, worldwide, there's an uneven or inequitable provision of other basics, such as disability benefits, guaranteed housing, food, and internet access. All of which I would argue is even more necessary for a good quality of life for all.
I don’t want to be chained to my employer for benefits, for retirement, for healthcare. It’s stupid to put a sociopathic entity with no accountability to you in charge of your basic needs.
Just look at how the city of Flint, MI poisoned their own citizens water while suppressing knowledge of their actions. [0] While in the grand scheme of government atrocities this actually appears relatively minor, this issue happened in very recent times.
One could fill pages listing government atrocities before even getting to basic incompetence and mismanagement. While inefficiencies happen in all bureaucratic organizations, governments hold singular power over their citizens in a way that no corporation could ever dream of.
This is not an argument against government. There are some services that only the government can provide. E.g., a strong military. Nor is this an argument against government playing some role in promoting general welfare.
I just personally would like the option to not be further dependent upon our government and would rather use my own economic agency to provide for my own unique needs. Many other people feel similarly and therefore reject this further intrusion of government in dictating our labor relations with employers.
I guess I don’t understand why this is the line in the sand, and why we must depend on private profit-motive entities to provide for basic welfare and an economic safety net when we can see it working in developed countries around the world.
The obvious solutions include new hybrid classifications or mandating certain benefits based on tenure. Why is this not considered? Why take away choice from those who specifically decided not to get a full-time driving job (which have always existed)?
I think a more productive line of debate would be:
1. Do we, as a society, believe we should only care for those who can be productive?
2. Do we, as a society, value things other than productivity?
3. Do we, as a society, believe it is the place of a governing body to ensure a standard quality of life (whatever that standard may be)?
Putting barriers around who deserves what doesn't really serve to do much other than exclude people who don't know how to work the system, or those who are unable to work the system.
In some countries these decisions are made for you and funded through taxes and fees. Other nations require you to plan your own way. The USA leans toward the individual over the state.
Certain things like healthcare should be revamped to remove the ties to employers but it's important to keep the prevailing culture in mind. People overwhelmingly still want the ability to choose here - what they lack are the options to choose from.
As an example my grandfather lost his leg to a blood clot due to being sent to an overwhelmed hospital that left him sitting undiagnosed for hours on end - it is easy to read that scenario as being forced into a lack of care, but choices wouldn't help things here. If he had a choice he would have advocated for going to his family doctor first which would have made the situation worse - in all honestly hospital overcrowding and underfunding is the only thing that led to him losing his leg.
Healthcare is a sector of the market that most people here (even me - and I work in a company that deals specifically in the US healthcare market) don't have enough knowledge to make intelligent choices in because the knowledge needed to comprehend all the random crap that can go wrong with your body is intensely deep.
I also don't think it's far to say the US favors individuals over the state - the US cares very little about individual health. And that's not precisely what you meant when you said it favors individuals over the state but I think it's important to highlight that the situation in the USA is quite detrimental to a lot of individuals.
And yes, I do want to choose my healthcare. I want to select the plan that best fits my needs. If you want a larger simpler plan that covers everything then you can choose that.
Me having choice does not take away from you, it only provides more for both of us.
And I especially don't understand how it doesn't lead to exactly the problematic outcome we are talking about which is that poor people can't afford access to quality healthcare.
You don't "choose" what level of fire department protection you need. How is healthcare different? I suppose you can always hire your own private firefighter/doctor...
So long as you give people the choice, and it's based on PERSONAL financial contributions rather than government-organized taxes, those with less means will have less access to a finite set of healthcare resources and result in systemic inequalities.
I suppose I can imagine that there is some "ultra deluxe" version of healthcare where instead of crutches you get a wheelchair, and instead of a shared recovery room you get your own, and I do support those with the means to pay extra for something like that. But the baseline HEALTHCARE access part needs to remain the same...
The issue is that better coverage requires private insurance, mostly offered through corporations. Smaller companies can't compete, some people can't leave a bad job because of losing their plan, and others are limited to public options because they don't work. This is the overwhelming problem with USA healthcare. There aren't actually many choices because of this complex and outdated connection between jobs and benefits.
I know that today America has choice. But it leads to the highest healthcare costs in the Western World (to allow for middlemen healthcare companies to be some of the largest privatecompanies in the country), with the worst quality for the poorest people.
So the question is, how do you solve the problem of universal access while giving people the "choice".
> The issue is that better coverage requires private insurance, mostly offered through corporations
Not in the rest of the western world. We just simply don't have these companies. They don't need to exist. They are a form of corporate socialism transferring wealth from taxpayers to mediate something that can be handled directly.
Health insurance companies is a moral failure. I'm going to double down on my metaphor. Fire engines don't check your insurance to decide if they should put your fire out. That used to be how things worked 100 years ago.
The choice for better healthcare is limited and locked behind employment. That's the problem, instead of letting everyone have access to all plans, and the solutions are too complicated to discuss here. However insurance is not a moral failure, it's a financial and risk management concept. Just because your government manages somethings for you with your taxes doesn't mean it doesn't exist.
I understand that when you're a fish it's hard to understand what water is, but the fact that employment plays any part into this whatsoever is a problem. Nobody in Canada or the UK or Luxembourg (some countries i have some experience with) would ever factor in healthcare in a decision to start or leave a job. It is absolutely not a variable.
Yes, I've said exactly this about half a dozen times now. It seems you're arguing based on myths and preconceived notions against the USA rather than actually responding to anything I've said. Let's end it here.
I just don't understand you acknowledging that healthcare choice being locked behind employment and insurance companies middlemen being a problem yet still wanting "healthcare choice." What does that mean to you if you don't have the others any longer?
I absolutely want to choose my healthcare.
The choice being discussed here is specifically around health plan particulars like stronger vs. weaker drug covers - surprising you by not covering any oncological drugs - or having a different balance between deductible and cost.
I'm still trying to grip why people care about choice though since most of those become non-issues with national insurance - most of those choices are about how you're going to balance paying for care with limited resources, while in nationalized systems the question of cost is mostly or fully removed - it's just the auxiliary costs that still can bite you (i.e. parking costs at a hospital, costs for a private room for recovery, etc...)
People have preferences for different doctors. Choosing different doctors is part of choosing your healthcare. Personally, I order my own tests and come to doctors with recommendations and ideas to discuss. Not all of them are open to this collaborative approach.
In terms of choosing insurance... It's a little silly to talk about what people want. What many people want is to go to whatever doctor or hospital whenever they want and have someone else pay for it. They often foolishly choose to limit out of pocket costs at point of service, while paying for coverage they don't need. Different people have different concerns. My preference is for my insurance to be for when I need it, and "first dollar coverage" is insuring me for an expense I can already afford, making it a bad deal.
To me the "prevailing culture" is more about the vibrancy of walking into a vendor and directly paying for services that you would like, rather than needing to appeal to some bureaucracy (whether "public" or "private") to convince it to agree that you "need" something. The medical system is currently so far from this, that I don't think it has much bearing on the practical reforms being discussed. Although I would love to see reforms in this direction as well - eg published price lists uniform for any payer, and a prohibition on arbitrary post-facto billing.
It's more like the providers have to conform to the Medicare pricing, instead of screwing the payers. This is why we need single pricer. Simply put into Medicare pricing agreements that the provider cannot charge anyone more than they charge Medicare or Medicaid. Not only does it avoid the price gouging of the uninsured and privately insured, it also ends the whole concept of out of network. Very few providers can survive without Medicare funds.
Politically I wonder what's holding this back, as it seems like it would be more palatable than Medicare for all. Silent hospital lobby? Big insurers that don't actually want to make their market more efficient as they're effectively cost-plus entities?
Not balancing this means society will go into decline one way or the other.
Offering basic levels to society members is health if the society can afford it and allows the society to grow quickie because risk is removed.
This is overly simplistic. Someone providing child or elder care is providing social value in a way which should not be measured against economic measures of production. Life is not an economic zero-sum game.
You might "work" 2h a month, because you spend the rest of it caring for family members, or maybe you're trying to get that first draft/beta version out the door.
Or you might just not want to work.
We need to stop assigning so much worth to work. We know automation is coming, and we know that not everyone is going to be able to find work in the future.
I mean it as a serious question, as it's not clear to me what the difference between benefits and salary is (not being from US).
I understand that the health insurance is one of them (and, to be clear, I do believe you should have that whether you work 0 or 100 hours a month).
But what are others? Pension contribution is just a part of your salary that you are required by law to put aside. Guaranteed minimum time off comes to mind, but that obviously makes less sense if you are already not working too much. What else?
There are millions of employees in the US who work part-time and choose their own schedules.
They do not allow you the same flexibility to work for the next 30 minutes, take a few hours off, then work another hour this evening without doing anything more than just starting or stopping the app whenever you feel like.
How would you replicate that with part-time hours?
This is a silly argument. You pay for your healthcare no matter what, it's just a question of who administers it.
> Then you put a million exclusions and tax deductions and other loopholes, so no one knows what they're really getting
This is precisely the current state of employer-sponsored healthcare, and also the wildly complicated medicare/medicaid system.
Universal coverage combined with higher taxes (ideally on people who already have lots of money and therefore place very little value on marginal income) is arguably better and easier to reason about than a mandate for employer-provided coverage and its associated opaque and complicated effects on labor markets, including higher fixed costs of hiring people and decreased ability for people to move between regions, industries, and even jobs within the same industry/career.
I'm happy to talk about manufacturer drug rebates which is an amazingly crazy portion of the healthcare market that would be illegal in almost any other market due to the perverse market incentives it creates. But yea, the short version is that the private healthcare market is incredibly inefficient.
But who administers it has a lot to do with how much you pay for it. For example, a high deductible plan will save you a lot of money as long as you aren't in the 99th percentile of healthcare needs, and (unless the deductible is really high) still not bankrupt you if it turns out you are.
Any kind of government plan that doesn't give you that choice because it's paid from taxes rather than premiums is plausibly going to cost you more money. And that's true even on average, because high deductible plans make people more price sensitive, which exerts downward pressure on costs. (The fact that US healthcare regulations disfavor high deductible plans is one of the reasons costs remain high.)
The US system is also uniquely screwed because the rest of the world piggybacks on US medical R&D while in practice regulating prices even for products under patent. The result is that the US market is paying a disproportionate share of the R&D cost. Cost comparisons to single payer systems that pretend that single payer systems are inherently less expensive are ignoring the lower contribution of those systems to worldwide medical R&D. Moreover, the recipient companies are disproportionately in the US and have lobbyists and large numbers of voter-employees, so implementing a single payer system here would be unlikely to remove those costs. Then you're left with the resulting increase in price insensitivity and the US system becomes even more unaffordable.
It's actually a hard problem. The solution probably has to involve the other countries paying more of the R&D.
Everyone choosing what is exactly right for them implies those choices are all possible and the complexity, risk and cost profile also makes sense.
Those things are not true, and the outcome is rapidly escalating cost and risk exposure.
This has been addressed in many ways, and one of the easier ways is to have government fund those bennies to provide a respectable floor. People who need more can choose to do that and the market for such things would make much more sense and be lower cost and risk for everyone.
An example seen worldwide is supplemental plans that operate in addition to primary plans, which are actually illegal in many parts of the world due to the inherent conflict between profit motive and health care.
You wanting to keep your money and make choices is very different from wanting other people to keep their money, which is an overreach frankly.
Further, in the current scenario, you really can't be sure medical people have your best interests in mind because the priority is making money not making sure we have healthy people.
When medical people are free to actually make healthy people a priority, the discussion about best interests becomes a much easier one.
Rough state of affairs, I would imagine.
However, I am far from unique.
Universal healthcare, say Medicare for All style, does not have to mean higher taxes. And it would make a big difference to gig workers and the ones working for the likes of Walmart.
A very high percentage of Walmart employees need government assistance due to their income not actually being enough to pay the laborer what their labor costs them to deliver.
At a minimum, labor needs to exist reasonably and show up for work. Healthcare is a part of that, right along with the basics.
All of us are subsidizing labor for a few of us to put profit, or more peak profit in the bank.
The priority discussion boils down to what makes the most sense for the nation.
Do we cut back on the military industrial complex?
Maybe we decide subsidizing labor makes sense. That would also mean not shaming and blaming people who seek and obtain help from the government. Doing that is baked in right now, in that no matter what those people do, a large percentage of them will need help.
Or, we simply change nothing and yes, taxes are higher, but the national spend is lower overall. Many of us will benefit.
We could prioritize it so employers are more on the hook in various ways. Some of them will not be viable. Even if they all are, we may not have enough jobs. Government could be an employer to make sure everyone has a work opportunity that pays enough to exist and show up for work.
There are many options. Not all mean higher taxes, but all that discussion means a national priority talk also has to happen.
If we do nothing, our priority is not having people make it, exist reasonably and show up for work.
Predictably, lots of people are not making it, may do crime, are homeless, may not have health care, maybe will show up for work, if they can get it.
If our priority becomes about people existing reasonably and showing up for work, we will see that, but will have higher taxes, or back off some other things we currently make a priority.
How would that be? It seems like it certainly would to me. Maybe by less than employees plus employers currently pay in aggregate healthcare costs, but I can't imagine a way where the government pays for Medicare-for-all and taxes don't go up.
Do you have a specific idea in mind that I'm missing?
In short - you can buy a banana for a dime or give the government a nickle and get a "free" banana.
I'm super glad my mom has Medicare! But she isn't benefitting from it being efficient, she's benefitting from it setting the rate it pays and requiring providers to accept it.
The other is a compulsory payment to a government entity as a result of earning income.
The rest of the developed world would very strongly disagree.
The penalty for not making that payment can be death, is likely financial ruin.
For many people, that optional payment is enough to buy a home.
Ask around about "optional"
Then we can set that aside and recognize net, liquid income will go up for most everyone.
All in the US more or less pays roughly 2x or more what some other countries pay for equivalent healthcare, so there is nominally room to extend coverage while keeping costs flat in theory. In practice, it's complicated. Also 'roughly' and 'more or less' have some wiggle room for systemic differences, but it's about right.
The US spends $676 billion on defense, almost the exact same amount on Medicare, $1 trillion on Social Security, and $409 billion on Medicaid. Social welfare spending is a much, much larger portion of the US budget than military spending. Here are the numbers straight from the Congressional Budget Office https://www.cbo.gov/system/files/2020-04/56324-CBO-2019-budg...
Did that Trillion not come from people contributing? You know it did.
And still, we can and should totally question our current spend.
How does that impact the discussion? Do we think we need another problem by not actually paying those benefits?
Secondly, back to the first question, so?
What's our priority?
Right now that priority is not healthy people, able to show up for work, existing reasonably.
Does that make the best sense? I don't think so.
The other thing I did was walkthrough a little bit about what those priorities might look like. There's several ways to solve this problem.
And we do have a problem when roughly half the labor force makes roughly 30k a year.
"We" don't necessarily think benefits should be provided by the whims of private businesses.
as opposed to the government because that means higher taxes.
The assumption here being that benefits from the government are paid with higher taxes, and benefits from employers being paid from the kindness of the CEO's heart and not from wages that would have otherwise been paid you.
>"We" don't
I want the money that my employer pays into health insurance to be paid to me into an HSA like tax sheltering of healthcare funds, and then I want no health insurance middleman. Poof---there goes all the corrupt incentives and ridiculous administrative overhead.
That is literally impossible. Even if insurance companies are made illegal tomorrow, that role of market maker between providers (doctors and hospitals, drug companies) and customers (patients, employers) will always exist. This is because such a role is needed.
Patients do not have the capacity nor the knowledge to find the best doctor, the best hospital, or the best drug maker for them.
Health insurance was invented in the late 1930s as a political ploy to forestall government health programs. Did patients all get stupid at that time, or was it the case that they were all going to the wrong doctors and hospitals before then?
Please give human beings a little credit. We make decisions every day, some of which are a lot more substantial than which state-licensed physician to hire.
ps. you don't know what "market maker" means...
Okay, but I didn't mean literally outlaw insurance middlemen.
I mean fix the incentive structure such that I have the option to forego insurance middlemen.
> Patients do not have the capacity nor the knowledge
I completely disagree, and what business of yours or anyone's is it to say I'm `lacking in capacity and knowledge` to such a degree I shouldn't be allowed to make my own healthcare decisions!?
Worse still, right now the US government puts a cap on the percentage of profit an insurance company can take from premiums which coupled with the current near monopolistic healthcare insurance system incentivizes paying as much as possible for treatment to justify higher premiums.
Generally what you're describing is a full time employee... that's kinda the thing you didn't seem to like.
In 5-10 years, what will be the current driver's expectations for pay?
Are you comparing full-time hourly employees to part-time contracting?
> They also give her
When you say it like that, you are describing an employee not an independent contractor.
But your layer comment, about setting her own rates, makes me think that she is working as an actual freelancer, not as a gig employee.
Is this... a thing? I've never had that option in any of my jobs. Sure, I can choose not to take the employee sponsored health insurance, but then I'm just opting out of my share of the monthly premiums the company would deduct. But in general, a company pays more than that. I've never been able to opt out of company insurance and recover their share of the premiums! I assumed that wasn't legal for them to offer.
Oh, and to be explicit about the connection: that's why an independent contractor would be paid more. If an employee's wage is $x, a company generally pays something like $(2x), and so an independent contractor would expect to be paid something closer to 2x than x. (Usually because they* then have to pay certain taxes, and worry about their own benefits, etc.)
"When you say it like that, you are describing an employee not an independent contractor."
This doesn't make sense to me. She has more autonomy than an employee would. They give her that level of autonomy by not making her an employee. She does not get a W2.
"But your layer comment, about setting her own rates, makes me think that she is working as an actual freelancer, not as a gig employee."
There's a lot of overlap between those terms, except replace employee with worker. I would say she's a freelance gig worker. Freelance tends to mean that you are just independent. You can work on an individual project for a company and move on, but it's usually larger pieces of work. As a gig worker, I see it as being more of a repetitive task for various customers. You can be a freelance driver and work for both uber and Lyft, or even uber and a taxi company. The gig part is that they are always individual tasks you get paid for - each ride. This is very similar to what she is doing.
So I see gig workers as freelancers, but not all freelancers are gig workers.
In my experience, most benefits are use-it-or-lose it.
Practical barriers in terms of the maximum limit of complexity legal and HR are willing/able to take on and remain effective while dealing with? Absolutely. Everyone thinks "It shouldn't be that hard!"
In reality, it kinda is. HR abstracts away the complexities of jurisdiction specific hiring requirements from the rest of the org, and legal does much the same. If you ask for extraordinary accomodation, I'm not saying it won't work, but I can guarantee you will experience friction while HR/Legal figures it out.
On the plus side, if it works, new employment template. If it doesn't, you don't get offered the job.
I've ended up the awkward giraffe in a couple places. You being flexible, and the HR/Management recognizing your unique capability to create value helps. However, when talking Gig work, they will invariably go for the template approach. There's also the fact that Gig work really conflates the distinction between "contractor" and "employee" in the sense that contractor carries with it an assumption you are providing for your own affairs. The compensation you quote them should have parity with their total outlay for an employee to do the job, because you should be arranging the same things for yourself; thereby obviating your need for the employer to do it. The thing you get out of by the contract route is all that paperwork and process overhead. You do a one-time disbursement of funds, and donezo.
The problem is, no one ever tells you (the contractor) that, and Uber et al does not let you quote price or have input on the cost calculation. So you accept super under-bid compensation, because you don't know the difference between a market rate and a hole in the wall, or an appreciation for the total footprint of the business model.
Uber, and services like it, make their money by predating. on this ignorance. This is not to say that stuff like "licensing" gig workers to vouch for the fact they really know what they are doing is really a good idea... I'm kind of curious though what kind of effect that sort of thing would have on the worker pool. Like a short course that make sure they understand the accounting. Wonder if an experiment could be run with that sort of thing somewhere and how it would effect the market.
That being said, it kinda kills the value prop of people just needing a few bucks here and there, but I question the seductive simplicity underneath that pitch, because everytime I've run into something that's pitched that way there's a big ole ugly iceberg beneath it.
At lower paying hourly jobs typically the employer doesn't cover any of the cost. For many these are prohibitively expensive, even if you work full time. Typically for higher paid work, most salary positions, the employer covers most of the cost.
The fact that most employers do dictate hours is a function of those job expectations, not their legal employment classification.
It is pretty common for mid or senior level white-collar salaried jobs to have a decent amount of freedom in working hours within what is functionally reasonable for their role.
That is so disconnected from reality for the majority of American workers that you might have broken me. But lets start with salaried workers have a job .. Their employers don't care what time you work as long as you get that job done. How exactly would that work for Uber? quotas? avg 2-3 rides and hour or ur fired?
I am saying, classification as an employee does not require Uber to change anything about their expectations of their workers' work frequency, duration, or schedule. It can remain voluntary just as it is now.
There are currently voluntary hourly jobs that exist, but people here are probably less familiar with that concept as compared to salaried jobs.
As employees, Uber cannot dynamically vary the pay/minute rate, especially if it falls below minimum wage combined with vehicle/gas reimbursement.
If you are a salaried employee the sad state of the system is a lot of companies tend to take advantage of you and overwork you and don't pay you overtime.
The flip side of it is contractors don't usually get paid vacation, so it's both an advantage and a disadvantage.
>Many gig workers explicitly do not want to become employees, as there are many disadvantages to doing so
Then companies that want to attract gig workers can give them the freedoms that are set by statute, regulatory bodies, and precedent. Like setting their own rates and picking which contracts to fulfill.
You're mistaken. It is not independent workers that are disadvantaged, but employees who as a result of those laws are less attractive to hire.
The solution here is to remove those arbitrary restrictions, not to expand them.
I have real independent contractors in my family, they might work 2 hours each for 50 different customers in a year. They do their job exactly how they want to. It's not like it makes sense for any one of their customers to provide benefits of any kind. This is the kind of stuff this classification was meant for.
They already have as much time off as they choose to have. It's all (obviously) unpaid as "who would pay them?"
Really all PTO is for most salary exempt positions anymore is ability to delay work without getting fired. Now if you work in a position where you churn out things on a daily basis or less and someone will fill in for you while you're gone, PTO is actually PTO.
There's an implication from PTO of a different era where you weren't required to makeup work you missed while on PTO. Much of that has disappeared. That's fine for most salary exempt positions assuming you aren't fed a constant queue of work to keep you pushing 50+ hour weeks regularly and it's OK to do 20 hour work weeks and some 50 hour work weeks.
Maybe I'm just old and people don't care that they do more for less TC than they did in years past.
There's a lot of jobs where work simply is not with a regular customer -- i.e. tradesmen, independent consultants, musicians, etc.
If a person mows lawns for 25 different customers in a given week, who gives them their vacation/retirement/health benefits?
And how exactly would you reach this conclusion? How would you know what's better for someone, better than they do? At least in CA, the decision was clear that it wasn't against people's interest.
This must be why Uber incessantly spammed their workers with Prop 22 propaganda via push notifications[1] on their phones and tablets.
[1] https://www.theverge.com/2020/10/15/21517316/uber-spamming-u...
Prop 22 actually removes options from the table, making it almost impossible to modify, repeal or replace the proposition. Surely if you and Uber cared about giving people options, then you'd recognize that labor law needs to adapt with the needs of workers, instead of being cemented in time in a manner that benefits some employers over everyone else.
Basically imagine you have Job A all things being equal you can have the Job A and all the benefits of being an employee or you can have Job A and none of the benefits of being an employee. How is it possible it is in anyone's interest to take Job A and not receive the benefits they are legally entitled to?
Quite the contrary: the government acts to prevent a ruthless race to the bottom as someone who skips e.g. on health insurance or on worker protection laws (e.g. daily work time maximums) can outcompete someone who sticks to the rules.
Especially with health insurance, the government has to pay the tab of those who skip it and then can't pay for the hospital.
> Many gig workers explicitly do not want to become employees, as there are many disadvantages to doing so.
The only reason I see why people want to voluntarily go gig worker is schedule flexibility - they don't want a regular full time or part time schedule because of children, elder care or whatever. And for what it's worth employment regulations should be made more flexible in that regard, but it must be prevented that employers go and abuse it to exploit their workers (e.g. by arbitrarily cutting their hours).
Lots of issues in modern US business arise from laziness / stupidity / corruption / uselessness of Congress.
I believe that there should be reform and that we should be working towards a better legal environment for informal workers and companies that want to use them at scale facilitated by technology. You can believe that and still recognize that the law as written would not support a definition of these workers as independent contractors (because they are not and it really is not a gray area due to the way that they are managed/directed).
It's also an issue for the US that we can go many years under an enforcement regime that assumes that we basically have this new category of worker that we are, for reasons of convenience, defining as independent contractors, but that the law clearly states do not meet the definition of independent contractors. Then we get a new administration that decides it will enforce the law as it's written instead of tacitly recognizing the fake pseudo reform of non enforcement that we had from earlier administrations. That isn't good government.
And by extension lots of issues in Congress arise from laziness / stupidity / corruption / uselesssness of the electorate that put them there. Invest heavily in education and revisit in a few generations.
It is a persistent myth that the US does not invest in education. Not only is the dollars per student spent in the US competitive, it exceeds the majority of European nations spending per student by a large margin.
"In 2015, the United States spent approximately $12,800 per student on elementary and secondary education. That is over 35% more than the OECD country average of $9,500. At the post-secondary level, the United States spent approximately $30,000 per student, which was 93% higher than the average of OECD countries ($16,100)."
https://www.investopedia.com/ask/answers/020915/what-country...
I see this question only rarely asked. Too many people seem to think that shoveling extra money on X will get you better results almost automatically. No, it won't, corruption and special interests can capture that extra value unless the investor is careful.
Now it is true that underfinancing will get you worse results, but the opposite just does not hold.
Money is going somewhere but most of it isn't into the actual education.
It also means that outside money can lead to successful primaries of otherwise popular legislators, if the legislator doesn't toe the line required. There used to be many Republicans that not only publicly agreed that climate change is a real, human-caused, phenomenon and that also proposed action to solve the problem. After a few legislators got primaried out of their seats, this position is no longer allowed at all in public statements by Republicans, because most legislators are too scared to risk being primaried.
Increasing the House of Representatives by ten fold or more might help.
Getting rid of many of the procedures that prevent votes from happening would probably help too.
And of course, overturning Citizens United...
While you would end up with much more representatives - and in theory more representation - each individual rep would become much less influential. I think expanding the house to be thousands of members large would also make deliberations much more difficult and shallow as a result. I have no idea how parliamentary procedure would work with thousands of interested parties. But I do acknowledge that it is do-able.
That being said, I am in favor of increasing the size of the house, but only by about 100 seats or so. I'd also want term limits in order to facilitate more turnover for district seats. But that's a separate debate.
This.
Sometimes I feel like the entire nation needs to go back and revisit our civics books. The job of the Labor Secretary is to make certain that federal labor laws are followed. If you want changes to federal labor law, it does you no good to demand them of the Labor Secretary. Call your congressperson and your senator. Even better, vote for more qualified congresspeople and senators.
This is a republic. Which means that ultimately, the labor laws are far more our fault than the fault of the Labor Secretary.
It also doesn't really matter what the Federal law is or Labor Secretary does/says, worker agreements are governed by State law, and their are 50 States with similar, but not identical legal standards defining employees vs independent contractors. In some cases you may be defined as an employee at the State level but Independent Contractor for purposes of the Federal level (say the IRS Code/Federal Taxes). Even within a single State one agency say unemployment office was classify you as employee and another such as workers comp classifies you as independent contractor.
The problem with this comment (and others like it) is the presupposition that the problem is that people are not voting "correctly", because if only they did, all the problems would be solved.
But that glosses over a very large number of problems, some of which are deeply systematic, at which point questions like "whose job is it really to fix these issues anyways" may in fact deserve answers that are more out-of-the-box than "the republican democratic system works as intended, so the problem must be elsewhere".
This glosses over the fact that enough of the population disagrees with your assessment of the problem and proposed solutions that there is no consensus and that is why your problems are not being solved in the way that you want. In fact, that is almost always the case.
People feel that the thresholds of consensus required in republican processes get in the way of their plans only when they fail to persuade others. Then they start looking for more authoritarian solutions, such as having party-bureaucrats make laws by fiat.
Yes, this is part of it, but it goes even deeper than that. For example, California government passed AB-5, and then later popular ballot passed prop 22, which essentially goes contrary to AB-5. Does that suggest that leadership is out of touch with the electorate? Maybe. The fact that numerous pages of exceptions had to be carved out in AB-5 in the first place (and it's still criticized even after that) also indicates that the legislation wasn't very well thought out to begin with.
If you think in terms of a software engineering organization, it would seem crazy to take bug reports and just blindly do whatever the tickets with largest number of CAPS LOCK words says. But governments often do exactly that: they take some top-of-mind idea and just go with it, without paying heed to any sort of expert research, leaving implementation details to be determined by others "lesser" offices of government, and without care for the repercussions of rolling out such policies. It's the equivalent of pushing the "release" button in your enterprise software, cross your fingers and hope for the best, without any observability infrastructure and without a rollback plan if everything breaks.
> People feel that the thresholds of consensus required in republican processes get in the way of their plans only when they fail to persuade others. Then they start looking for more authoritarian solutions
This is also true, and it's definitely a touchy subject. On one hand, global consensus seems "fairest", but is it really the fairest if the vast majority of people are not affected by a decision (or they are affected to different degrees depending on various factors)? What of their expertise in the subject matter? Many problems do have solutions that align with common sense, but many others require solutions that are counterintuitive, but that can only be proven to be more effective with hard research. It's a difficult line to thread, and I feel that the status quo favors popularity more than science when it comes to decision making.
The idea of representative government is you outsource decision making to people, not that you hire people to always do what the majority wants. That is the justification for a ballot initiative override. Not necessarily saying that ballot overrides of legislative actions are good structure -- there are pros and cons. But in the case of AB-5, that was clearly an out-of-touch legislative body taking some very extreme measures that were more radical than the state population wanted. That is a common thing when you have one-party states like CA, so in the current CA landscape ballot initiatives are a good safety check on what is a one party legislature controlled by party insiders.
> If you think in terms of a software engineering organization, it would seem crazy to take bug reports and just blindly do whatever the tickets with largest number of CAPS LOCK words says. But governments often do exactly that
In my experience in the corporate world, working from everything from non-profits to start ups to DJIA member companies, I find corporate decision making to be equally random and opaque. They are just random in different ways. In the corporate world, if you can find an executive sponsor and frame something the right way, you can convince them to follow a road of sheer madness. In government, if you can convince a politician that something is trendy or a cheap way of getting votes, they will commit huge blunders. If you can convince them that something is a moral imperative, they will commit unspeakable atrocities.
> This is also true, and it's definitely a touchy subject. On one hand, global consensus seems "fairest", but is it really the fairest if the vast majority of people are not affected by a decision (or they are affected to different degrees depending on various factors)?
Indeed a tough subject. The way I think about is this. If you are in the business world and you are leading a team of 5 engineers, who are trying to make a decision. Let's say 3 strongly believe in A. 2 Strongly believe in B and are strongly opposed to A. Do you say "majority rules"? Unlikely. You will try to find consensus. Consensus could be something like 60%A and 40%B. This consensus gathering process is why businesses often do crazy things, but they don't know a better way as pissing off 40% of your team is something you need to avoid. The 2 people can quit -- they can transfer to another team. So ultimately you do need to gather consensus rather than search for 50% +1 in making decisions within a team.
But a society is like that team. It requires more than 50% +1, otherwise you will find groups seceeding. One way of addressing this is to put in various roadblocks to require more than 50%. Say you need 2/3. Then people have to negotiate. If you want to do something 1/3 hates, then you can do it if you give them something in return. You bargain and you reach a consensus where everyone gets some of what they want, even if they don't like it. But then you might reach a situation where the society is split and simply can't come to a consensus because there are moral issues at stake that they are not willing to compromise on. Then your option is federalism. You break the society up into two groups and let each one make rules for themselves. Within each federalist group you have the super majority requirement again, but because they have shared values, they can reach that super majority.
All of this stuff was debated long ago in 18th-19th C France and England, and many very smart people looked at all these issues, which is why we have this weird federalist form of government in the US where you have both a senate and a house and it's really hard to get anything passed into law unless you have both a geographic and population supermajority on your side. But as the nation splits into two camps that view each other as basically evil, unreedemable, hopelessly foolish people, you are finding more and more gridlock and more and more appeals to Federalism. California wants to run their own climate policy? Fine, let them. Oklahoma wants fracking and free gasoline to everyone? Fine, let them. If you don't, the days of the republic are numbered.
That's fair, but it's still madness :)
> ultimately you do need to gather consensus
I think consensus is just one form of conflict resolution. Compromise is another, for example. When we have a scenario of 5 people, 3 pro-X and 2 pro-Y, one could argue that are actually three choices: X, Y and the status quo, where an impasse between X and Y is functionally equivalent to everyone being pro-status-quo. Rephrasing in terms of status quo vs something else might help in understanding where X and Y overlap and where they differ and might lead to more productive open-ended discussions than a discussion that is solely adversarial between X and Y.
I don't believe it's necessarily possible to reach consensus in all cases. For example, the issue of abortion doesn't seem like one where either side is willing to let go. But I do believe that it's possible to reach a compromise in many cases (for example, pro-life proponents might be willing to concede that a anencephalic fetus posing life threatening risk to the mother is an acceptable case, while still believing that normal unplanned pregnancies should be taken responsibility for).
There's also always a possibility of a fourth choice Z, for example a policy from a different country (e.g. Portugal's handling of drug abuse being seen as a medical problem, rather than limiting the discussion to one solely about the spectrum of criminal severity). And there's yet other ways to handle conflicts, such as the iron fist approach that China uses (which some might argue was effective at handling covid, for example, questionable as it may be in other areas such as freedom of speech).
My take away is mostly that even if things are as they are because of something that was settled by scholars centuries ago, it still behooves us to revisit different ideas, ideologies and approaches to tackle today's problems, rather than ignoring or not understanding the weaknesses of the status quo processes.
For issues that can't be compromised, federalism is the solution. However this falls apart for issues where there are real (or perceived) externalities. If you are anti-abortion because of your moral framework, its unlikely you see allowing another community to do it as acceptable. The same as if you are worried about climate change, you don't want fracking in places you don't live.
But if you think the labor sec should merely concern themself with robotically enforcing the most literal meaning of the labor code, I think that's dubious as well. They should be thinking more big picture than that, like about whether the laws, when enforced, achieve their ostensible purpose. In this case, I would think it means saying, "well, if we want to do right by workers, I recommend we refactor the labor system like so...". That is, pass that on to Congress and the administration.
That, I think, should be a higher priority than fighting ever harder to be technically correct on an increasingly arcane distinction.
At which point congress is free to ignore the secretary. Ultimate authority always lies with congress. We can change that, assuming we want to change the Constitution. But today, congress is in charge of making laws. It is not in the remit of the Secretary to short circuit the Constitutional order. The best the secretary can do is, effectively, to send an email to congresspeople and senators. Which email would be a whole lot more effective coming from the voters instead of the secretary.
If the Labor Secretary is not acting in accord with Federal Statutes passed by Congress and legal precedents established by the Federal Courts, the Secretary can be sued and injunctive relief sought. Of course the Secretary can be sued even if they are following the law.
The problem with your argument is that because the law is ambiguous with regard to this situation, the labor secretary is effectively making law by choosing a particular interpretation of the law.
Though to be clear, I agree with you 100% that this is because Congress is just perpetually failing America through corruption, selfishness, etc., and that failure puts the labor secretary in an unenviable position of having to enforce laws that don't really work for the situation.
As a member of the Executive branch, that seems to be his job, yes.
My understanding is that if a worker has any characteristic of an employee, they are an employee. Any of several criteria are sufficient and only one of them is necessary.
In the bigger picture, Congress passes laws and delegates authority to a branch of government to establish rules and regulations using a process complying with other statutes that dictate how rules and regulations become binding.
Essentially, in the US at all levels -- Federal, State, and Local -- there are two types of legal requirements. Statutes and rules/regulations. The statute is the what. Rules and regulations are the implementation details...ok, there's actually a third parallel part which is legal precedent established by the courts.
Anyway, Congress delegates authority to executive agencies so that it can focus on other things and not have to micro-mange each tiny detail of everything under the sun.
As to "Anyway, Congress delegates authority to executive agencies so that it can focus on other things and not have to micro-mange each tiny detail of everything under the sun." - each tiny detail? This is a case of classifying millions of workers. We're not talking about a tiny detail, we're talking about something that is immensely important both to all the people affected by it as well as all the companies that have to operate under these labor laws. This isn't Congress delegating away the details, it's them failing for an extended period of time to address an absolute enormous and critical issue in the labor market.
In terms of scale the Department of Labor classifies all workers. Should Congress classify each worker individually?
Were previous Labor Secretaries out of line for classifying the workers as contractors?
Your argument does not provide any basis for preferring one interpretation over another.
In terms of preference, mine is not for one labor secretary's policy over another (I mean, I have a preference there, but it's beside the point here). My argument is that the labor secretary is making law here, and that is a bad thing because it is the job of Congress to make laws, which they are utterly failing to do.
Congressional paralysis is definitely a problem, but until we have a major change in either Senate rules or political paradigm, we not see any improvement on that front.
“Employees” gain access to the full gamut of employment-law protections; “workers” get some protections but can be dismissed at will; the self-employed are taxed more lightly but receive few legal rights.
The Surpreme court ruled that Uber drivers are workers and not self-employed.
And self-employed here generally are not taxed less, rather about the same (details vary), but have to do the taxation themselves.
I should note that you still can be fired illegally, for example surrounding harassment or protected status (gender, race, etc...).
The government policy would prevent companies from misclassifying employees as independent contractors, and any individuals who did not want to be employees could opt out of that classification, but that's up to the individual, not the company.
When there are more people who prefer convenient hours than shifts available, some will only have the option to take inconvenient ones. As hourly employees, Uber can't use dynamic pay to manage supply and demand imbalances.
I dealt this as a teenager working at McDonald's. Most of us didn't want closing shift, and occasionally at 25 cent/hour incentive would be added. But more often than not, the demand for any hours was sufficient. Labor supply simply exceeded demand.
Still think Uber and likes should be regulated away until we have true self driving cars. That may take a decade or more.
The "gig economy" is a legal hack by corporations to pay workers less than minimum wage [2]. We can talk a lot about problems with government (there are a lot of issue there), but the fact that the government has issues does not act as a free pass to allow private institutions to pay workers less.
[1] https://mashable.com/article/uber-driver-survey-pandemic/
[2] https://www.chicagotribune.com/business/ct-biz-uber-driver-w...
I don't even get your initial point. Have you never worked a job you didn't like? Many jobs suck, but people have to earn money. They will hopefully, eventually move on to more satisfying jobs.
> Many gig workers explicitly do not want to become employees
I’ll be more clear, I have two points, point 1 is that “workers do not choose gig economy jobs because they offer flexibility, they choose them because they have low barriers to entry”. This means that employee classification is irrelevant to workers, they do not explicitly want to be contractors. The 20% job dissatisfaction statistic is sufficient to prove my point because if there were alternatives, those 1/5 of workers would not be working for Uber.
Point 2 is “the gig economy benefits employers more than traditional employment and disadvantages workers more than traditional employment” I support this claim with the statement that Uber drivers have been paid less than minimum wage.
20% is good for job dissatisfaction. Why would you be dissatisfied working there? Because you'd rather be doing something else. That's why they pay you.
Sounds exactly like a gig industry talking point, a classic conflation of making something a right with forcing it onto people. At the moment, being categorized as an employee is not even an option for gig workers. How's that for choice?
You can say that they can't decide for themselves because they are being oppressed, etc, etc... and while I agree with the sentiment I don't think "oppression" here is that bad as to force people to vote what gig economy companies want them to vote on an independent poll.
I think most know the worker routine. If they don't look a certain way, the right age, the right resume, they won't get the job.
And the fact once they are an employee, they lose any bit of autonomy they think they have by being a independant?
It's too bad that we have a huge line of people:
1. Buying a vechicle specific four door vechicle Uber approves of before even applying to use the app. That is a huge upfront expence. Uber makes it sound like we all have a late model four door sedan collecting dust in the four car garage?
People are going bankrupt at best, but usually ruining credit, buying this huge asset in order to drive at the whims of Uber. There's no guarantes whatsoever. Want a deal on a four door sedan? Look at Craigslist used vechicle sales. Look for the last year Uber allows independents to drive. Actually I have noticed guys get another newer vechicle a couple of years before their vechicle ages out of Ubers strict year requirements. Some keep the useless four door sedan to drive a few more years under Lyft, or that's what I heard.
2. The guys whom are making a livible wage are usually driving to a big city. (A guy I know drives from santa Rosa to SF 7 days a week to make it work financially, and he is barely making it. He's working 80 hrs week.)
3. No health, they pay for gas, and insurance.
4. Yes--I'm picking on Uber.
My point is before Uber Bought the proposition, many drivers wanted better working conditions, and most seemed excited Uber might have to give them a vechicle, and working conditions would be better.
Then reality/fear set in? They will probally be fired next, or never hired me in the first place?
Maybe I'll just stick with this chitty job? America has become the king of chitty jobs.
And we have a lot of desperate people who will take these lousy jobs.
I'm not seeing it anymore, but I recall seeing an Uber related lease program, and now I'm seeing Uber related rental car programs. In the Seattle area, it looks like I could rent a car from two different companies for about $220 per week that's intended to be used for unlicensed taxi services.
If I were going to drive for Uber, and they didn't like my current vehicle, I'd drive a rental for a few weeks at least, to make sure it met my needs before dumping a bunch of money into a car.
If these drivers want to be independent contractors and not employees, great, if these laws were fully enforced from the beginning it would be the drivers that organized and owned the ride sharing business and UBER would have never been able to compete with them (UBER's own S-1 admits this risk, and acknowledges if drivers were Employees it would be an existential threat to their business). Its also no surprise this legal inevitability comes after their public offering.
Sure many gig workers may not want to be employees, but they were, they just were not being provided the benefits and protections. I don't think the politicians are the only ones who benefited clearly the UBER investors and private shareholders pre-IPO were the single largest beneficiary.
Is there any reason on the merits you disagree with the current legal standards distinguishing employee vs independent contractor? I mean the drivers desires is not part of the standard, and in fairness, I don't think you are able to collectively speak on behalf of all drivers and say that's what they wanted, clearly based on the number of lawsuits and employment claims many of them did want the employee status and benefits that come with it.
The people who are not successful are independent workers who are dependent on an employer. The government cannot fix a logical contradiction.
There are all manner of things we seem to lean on business to provide that government does not. Health insurance is the obvious one.
But we also seem to have a large part of our electorate that like it that way — that don't want government involved in our welfare.
If you want to tip the table toward government taking more responsibility and corporate America less, that is a tougher battle.
I agree with the ethos of your response, but not the rationale.
Many people don't understand the costs associated with being gig workers.
Many people don't understand the value of benefits given to them by employers.
This is a big reason why democracies exist - many people simply can't make decisions for themselves.
[0] - There's only one for the record and it's Switzerland.
So then why do articles like this exist? If people know all of the things that directly affect them, why do they make so many mistakes?
https://blog.stridehealth.com/post/1099-tax-mistakes
https://www.taxslayer.com/blog/rideshare-drivers-avoid-these...
https://www.ayroyal.com/uber-tax-form-mistakes-avoid/
https://www.ridesharingdriver.com/top-5-uber-lyft-tax-mistak...
There is a logical fallacy here, but I'm not sure if there is a name for it. In essence, the above argument is assuming "the government" is one actor who is able to choose between various options at the same time. In practice, "the government" is a collection of actors, with many competing interests, with different mechanisms of influence available at different times.
Aside: for anyone that thinks technology is hard, I would suggest running for office -- even a 'minor' role like being a school board member. This might shed some light on the difficulties of leading in a broader context. There is a reason it is called 'public service'.
Gig workers should be able to organize and effectively negotiate reasonable contracts instead of getting the shaft. My brothers union contract for musical performance crates a more free market environment than the whims of companies like Doordash.
On what basis do you say this? Have you found good unbiased survey research?
Gig worker falls off a ladder and ends up a paraplegic. Guess who will be footing the bill?
In America, we already gave up on that fight. Instead, we made it your employer's responsibility to provide you healthcare. And now the government is yelling at Uber for not giving you healthcare.
Fascinating.
Perhaps the real problem is that the IRS makes it such a massive PITA to be a contractor. You need to withhold your own taxes, pay nearly 30% of your money to the government, etc. Nobody likes that, and unsurprisingly, a lot of contractors fail to meet the requirements.
You know who really doesn't like it? The IRS. When most of the population is on W2 employment, the IRS has a constant revenue stream of payroll taxes and automatically withheld income taxes coming into its coffers every pay cycle. But with contractors, the IRS only gets that money once a year, and often times they're missing a piece of it.
Also – just putting this out there – a population of contractors would have much more power in a hypothetical "tax boycott" than a population of employees. I could imagine some social movement convincing all the contractors in the country to boycott the IRS and skip paying taxes one year. I doubt "the government" is anywhere near competent enough to conspire against this possibility, but the existential risk is there. Surely they would prefer that the peasants don't realize the power of collective tax resistance.
I don't know the entirety of the tax law, but I believe that you're supposed to make estimated tax payments quarterly.
https://www.irs.gov/businesses/small-businesses-self-employe...
IIRC this isn't true. Non-W2 earners are supposed to do quarterly taxes.
> and often times they're missing a piece of it.
This is kind of a bigger problem, no? If it gets to the end of the year, and so many 1099 contractors don't have enough to pay their taxes that it is actually an issue for the IRS, it strongly implies that those contractors didn't understand how much money they were actually making after tax (and thus, didn't put enough aside). Contractors not understanding how much money they are actually making (in relation to the W2 option) is not a good thing.
Maybe in theory, but I would bet, certainly not in practice for the vast majority of contractors earning an average income. You have to be the most honest, organized goody-two-shoes to actually pay those quarterly taxes.
It's also worth noting that many contractors live paycheck-to-paycheck, and even though they know they should be withholding 30% for tax, in practice they have bills to pay first. So when tax time comes (whether quarterly or yearly), they might simply not have the money.
I find it kind of dishonest to call this "living paycheck-to-paycheck" while ignoring tax with-holding. That is not "paycheck-to-paycheck" as much as "not being paid enough to live".
Speaking from personal experience, it’s much easier said than done. When your rent is due this month, taxes are due next year, and you’ve only got enough for rent... you aren’t gonna withhold 30%. It’s not because you don’t want to, but because you just don’t have the money. Call it poor financial management or whatever you want, but the reality is that lots of people get into this situation. Yet I doubt many of them would blame their clients (or Uber) for the problems. Most would say the government demands too much tax, or they can’t find enough work.
Personally I would be in favor of a $30k annual basic income and eliminating all taxes on up to $100k in earnings. It will never happen, but it would be one of the best things to happen to society in a long time.
https://directpay.irs.gov/directpay/payment
That doesn't mean filing, it means estimating and paying.
The rest of your post was pretty good, so it's disappointing to see you double-down on its one major flaw.
They don't. They had a survey and that's why Prop 22 passed.
People need more stable access to basic needs: healthcare, education, food, water, housing, communications (some kind of basic phone & internet access). This will necessarily lead to greater labor market mobility and therefore greater market power by labor providers (i.e. employees and contractors).
I want there to be more flexibility in work arrangements. That would be awesome, but the only way to make that work is to sever Health care and retirement plans from employment.
Employment should be simple, I do work and they pay me. Instead so many critical aspects of my life are tied to it as you mention.
Are they though? Uber said in its 2019 SEC filing that they may not make a profit [1], and while the company says profitability is around the corner, they have not yet turned that corner.
Not saying that Uber or any “gig economy” companies should continue to classify their workers as contractors, but if your business model does not generate a profit despite not providing benefits to your workers, one has to ask how viable that business model is.
While I understand the long game is to use self driving cars, this is not a proven technology. It’s a problem that may be solved in the next few years, but there’s no guarantee. Imagine investing in fusion energy, which has been just a few decades away for the last fifty or so years.
While sometimes the long play does work out, such as with Amazon, where you end up with a behemoth that dominates its market, you have to wait a long time to start seeing returns.
I wonder if these long term, risky investment opportunities are a sign that the exponential growth in the economy that we’ve become accustomed to is slowing down and becoming more S shaped. I can imagine this being a world where wealth does not come from growing and generating more wealth, but from political and bureaucratic maneuvering (like worker classification) to give workers less benefits and distribute the wealth higher up the class hierarchy.
[1] https://investorplace.com/2019/04/seriously-uber-never-turn-...
Yes exactly.
> I wonder if these long term, risky investment opportunities are a sign that the exponential growth in the economy that we’ve become accustomed to is slowing down and becoming more S shaped.
We do have a demand and growth problem, but let's step back a bit.
- Gig companies growing and paying net sub minimum wage will make growth worse: we live in a consumer economy and less purchasing power for the people will sap the rest of the economy.
- carshare/taxis are inefficient in strictly material terms: cars take up too much space, one driver per person is ridiculous overhead. Bikeshare and buses and trains both immensely improve on both of those. Fundamentally Uber is the low productivity result of our terrible urban planning: a tax we now all pay.
Maybe there is some deep societal reason we cannot prop up aggregate demand, but I don't think so: let the helicopter money begin! But Uber is worse than no stimulus because it low productive and wage deflating. The only good thing is in it's subsidization phase a bunch of Saudi money was dispersed to regular people, but once that ends the legacy is further eroded labor norms.
Why nearly 50%? Because that the highest amount you can have without additional liability. If they could get away with it, far more than 50% would be contractors.
The gig loophole benefits only super rich corporations. It's crazy to see so many people defending it. The sole purpose is undermining a century of worker protections.
Technology has made it easy to tweak jobs just enough so they fall under contractor status. When these laws were written nobody could imagine systems where work is reassigned in seconds. The rules about flexible schedules etc we made for a different time.
I've driven for rideshare. It's not like freelancing at all. You can't turn down rides. Can't set your prices. Can't choose your clients. Can't do your own advertising. You can only drive certain models and years of cars. There's rules about modifications you can do and how you treat customers. You have little to no control once you "sign on". It's a regular job with flexible hours
So instead of reforming their business model they just switched to a model where they made clear contractors were contractors--by treating them like trash. Fuck that.
Why? Because if they are allowed to enjoy the amenities of a normal staff member (free snacks, invite to company events, etc.) they run the risk of being classed as employees... which is bad news for everybody, not just the company. If you as a contractor are found to be incorrectly classified, that can mean a massive accounting headache, loss of tax benefits, possibly being required to enroll in a union, and lots more.
I've worked in Iceland and the UK, for 5 different companies, each one employing lots of contractors. All of them avoid these benefits for said reason. You can read up on IR35 if you want to know more about the UK rules (although it's been recently revamped making contracting a lot less appealing).
These are not the same type of contractors as 1099 contractors such as gig workers. Contractors at these big companies are usually employees of a staffing agency. They don't get sweet tech company benefits, but they are generally employees and have nothing to do with gig workers.
> Why nearly 50%? Because that the highest amount you can have without additional liability. If they could get away with it, far more than 50% would be contractors.
Which liability are you referring to? I've never heard of this and would love to look up what you're referring to, but you aren't being specific.
I'm expecting this to increase fares, but currently there is a lot of room between Uber's fares and traditional taxi fares so even if they went up 20 or 30% they would still be a fair bit cheaper.
My hope is that we'll eventually get to the point where we'll be able stand up a decentralized alternative that will allow us to cut out the Uber middleman.
Regardless in NYC Ubers tend to be about the same or more expensive during normal hours. And significantly more expensive during peak times. How much of the surge pricing goes towards the drivers pay? I'd wager margins are excellent for Uber during surge pricing.
There will come a day when each city will operate it's own system to facilitate app based taxis (will be on some standard protocol), and Uber a central entity out of SF won't be competitive or will be taxed out. Why let an entity extract X% of each ride out of its economy? Not worth it.
These debates about Uber/Lyft/etc employment status always seem to omit that there are two very distinct classes of people finding work with these services - one group is doing it part time in their personal vehicles, and the other group is doing it full-time in commercial vehicles. The interests of those two groups don't necessarily align.
In almost every place I've been to in the US in the last few years, Uber has not had competitive prices at all. They did back in ~2014, but their rates have been higher than yellow cabs and taxi services for a while now.
The only place I've been where this is true is NYC, which have piled regulations onto Uber (specifically and professionally licensed drivers, registered vehicles, etc) to the point that it seems to have closed the cost gap with taxis (who of course are also subject to these regulations). That is to say, Uber the company operates in New York, but it doesn't operate "Uber the ridesharing service", from an economic perspective.
OTOH, I don't have a ton of data points, since even at price parity taxis offer worse service, less accountability, less traceability (eg for lost items), worse incentives, less price transparency, etc etc
Also nowhere near the rudeness of cabbies but they HATE only having to drive a 5-20 blocks to take you between neighborhoods. Always hoping for that 30 mile ride.
Just can't seem to please every customer...
More often than not, they ended up in roads, across sidewalks blocking access, thrown in parking spots, in lakes rivers and other deep-enough bodies of water, thrown off parking structures, and more.
And in my city, both Bird and Lime came in the city on flatbed trucks between 4-5AM and offloaded them en masse. Where I come from, that's abandoning trash. Had they work with the city, this rollout couold have gone loads smoother and not start by trashing the public commons...
But in reality, thats what Silly-con valley companies do - they exfiltrate good will and good things like public commons and take it for themselves, all the while screaming that they're being wronged when people take, disassemble, throw in trash their littered goods.
1. Store private goods permanently on the public commons?
2. Hinder the use of the public commons for long-term?
3. Treat the public commons as a refuse-dump?
4. Privatize the gains while socialize the losses?
What if instead of banning a new transportation paradigm, the city had decided to work with the companies to convert 1/4 of the public parking spaces to scooter storage areas?
Another solution would be to arrest and prosecute these anti-social types trashing things. Just go all out against them. I routinely saw Limes and Birds being knocked over en masse by these idiots. It's why we can't have nice things.
But going against it would have probably upset some local donators. Now that it's "evil big tech" it's fashionable to bash on it.
/s
> But going against it would have probably upset some *local* donators
In what way is it sensible to classify big tech as a _local_ donor? Hell, the very term itself implies very wide reach.
In my opinion the opposite is true. Uber (and big tech generally) is often worse than what it’s replacing, and a hell of a lot more powerful politically. They don’t just take advantage of laws or have laws that favor them, they blatantly ignore laws with little to no consequence. There was some negative attention to taxis before Uber even existed, but because the problem was on a much smaller scale not much attention was paid to it.
Parent commenter could easily have meant that corruption when it comes from local entities is something that the public doesn't have good antibodies for, because of the classic "diffuse costs, concentrated benefits" problem. By contrast, putting an issue under the umbrella of "big tech" unites a lot of people under the same vague banner, as people are mad at big <industry> for any number of reasons, especially an industry as far-reaching as tech. This incentivizes politicians to care about an issue that their pocketbooks would otherwise prefer to ignore. (Note that this analysis is neutral wrt the actual goodness of policy, but that's just a basic feature of democracy)
It's pretty simplistic to interpret comments only through the lens of "big tech good? No, big tech bad" when a narrower point is being made.
>There was some negative attention to taxis before Uber even existed, but because the problem was on a much smaller scale not much attention was paid to it.
This lines up pretty cleanly
Uber is very much treating drivers like employees in ways Taxi companies don’t. For example, all trips are through Uber as drivers don’t advertise their services. Dismissing people based on User feedback is another.
It’s clearly somewhat debatable where Uber falls on the line, but if you’re basing it on the Taxi industry Uber drivers are on the employee side of the spectrum.
That assumption would be wrong 99.9% of the time in NYC pre-Uber/Lyft.
Why not start from here and work on the employment laws to allow for the flexibility or whatever works for that kind of employment?
Why pretend that an Uber driver is a businessmen that may actually expend his/her business or go through other company stages? Obviously that's not happening, therefore they should have the rights and obligations of a worker, not a business.
Do we know that to be true?
If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck.
Last time I checked, Uber wouldn't let you simply fulfil your duties of transporting people the way you find fit, for example. It's really not a B2B relationship in any meaningful way.
For those who do, sure. They are not gig workers, they are contractors.
Part of the Uber/Lyft "ickiness" factor is that you have a giant company that has defined a "contracting" relationship with 100s of thousands of individuals. That is big power and capcity differential. Its not unreasonable to expect that the gig service companies be required to provide more services for their drivers than, say, local independent window washer who contracts individually with many businesses. Automatic tax payments, minimum wage for callouts and depreciation payments for self provided equipment are not unreasonble past a certain scale point.
That being said, the people I've known personally who have drove for Uber/Lyft (around 4, so a small number admitadly) really were doing it just for a bit of extra cash on the side and would not have wanted or been able to be an employee of Uber/Lyft.
It’s just an incredible feat of mental acrobatics that hacker news convinces itself that the gig economy must be a good thing and must exist and it’s the government that’s behind, rather than the more obvious conclusion that _we have worker protections for a reason_ and these companies are not “disrupting” anything other than employment laws that protect the exploitation of workers, and other laws that protect wider society.
Just because some says it is “tech” doesn’t meant it’s good or we have to support it. Just feels like massive groupthink or lack of experience of the reality on the ground for most people.
https://www.irs.gov/businesses/small-businesses-self-employe...
If I sign a contract with him to go around other houses and make him fix the pipes the way I see fit, for example, using only black tape and stamp my logo on it, I receive the payments from the customers and pay him, he is my employee. People are not hiring him, they hire me and I employ him to do the job.
It's not even a marketplace, it's just me who finds the customers and the plumbers.
But that's not really the point here.
The point here is that there used to be a pretty well defined line between the self employed and employees. That's not the case anymore.
So we either spend decades making ever more complex unenforceable rules, and pretending taxi drivers deserve more/less from their jobs than (say) plumbers. Or we man up and stop pretending this makes sense and use a different system.
>“These companies are making profits and revenue and I’m not (going to) begrudge anyone for that because that's what we are about in America. But we also want to make sure that success trickles down to the worker,” he said.
If he's referring to Uber and Lyft specifically, then he's mistaken. Uber and Lyft remain breathtakingly unprofitable.
Would that fact change the way people think about this issue? I think it does... and advocates for reform think it does, too. Otherwise, why would they keep making this "mistake" when they talk about this issue?
As a side note: it's pretty poor journalism on Reuters' part to include that quote without any context or criticism, especially since they mention Uber and Lyft by name in the opening paragraph. Or, if he wasn't talking about Uber and Lyft, then Reuters' presentation makes him look like a liar, or at least embarrassingly misinformed. (He's the Labor Secretary after all -- he ought to know what he's talking about.)
If an Uber driver needs health insurance, that cost would be part of the calculus of deciding to drive for Uber. If the government provided it, the taxes required would also become part of that calculus. The deadweight loss from taxation can’t be ignored. Not to mention it isn’t my job to provide non-wage benefits to support Uber or a driver. That’s between them. Literally not my problem. If the Uber driver isn’t taxed proportional to their consumption of benefits, then I the taxpayer am forced to subsidize the profit of both Uber and the driver. If the driver has to pay for his own non-wage benefits, than that would be part of their determination of accepting the offered wage or not.
I don't know the best (most efficient for society) solution, but I'm pretty sure phasing out the tax write-off for employer-provided health insurance is a good start.
I think the argument is that there are certain public goods that should be included in the social contract and funded by taxes rather than via employers as part of the social contract. We can maybe disagree on what those specific public goods should be, but it doesn't absolve one from helping to pay for them if one wants to be a member of that society.
For example, public schools has been decided to be a public good paid for, in large part, by property taxes in the U.S. My sister does not get to opt out of that portion of taxes despite not having children. While it would be nice to be able to unilaterally choose each and every tax payment that we want to contribute to, I don't think that is feasible in a complex society. I would, however, like to see a simple chart on everybody's tax return that shows what portion of money they pay to each program at filing time in the hopes that it would lead to more informed decisions at the ballot box.
In the USA there is a lot of idle car stock that is leveraged to make something like doordash and uber work, and with this employment change if the workers could also deduct their vehicle costs as part of doing the job, I would foresee a lot less resistance from the industry.
I also don't think the 'employees' are going to get benefits either way, if this passed then their hours would be limited to the benefits threshold time like a lot of other low income jobs do now today, and they would be forced to work for 2 of the gig companies, who now will put strict scheduling on them making it a huge pain the ass.
In the end, nobody will be happy with the outcome and everyone would be worse off, except the government with some more tax revenue, or less because gig companies buying equipment will probably deduct more in total.
http://rationallyspeakingpodcast.org/show/episode-255-are-ub...
She interviews three experts on the subject. Here's the description of the episode:
>How much do Uber and Lyft drivers really earn, after expenses? Are they getting a raw deal by being classified as 'independent contractors' instead of employees? I explore the debate over these questions with three guests: Louis Hyman (Cornell), Veena Dubal (UC Hastings College of the Law), and Harry Campbell (The Rideshare Guy).
This fight has nothing to do with independence and only has to do with employers trying to save some 15% of an employee's wage in taxes & keep themselves off the hook if people get injured on the job.
The savings are real - somebody making $1000 a day - classified as an employee, costs an additional estimated $150.
You can pay short term workers as employees pretty easily (we facilitate it).
1. Writing off business expenses (gas, vehicle wear and tear, etc)
2. The Qualified Business Income deduction of 20%
3. Larger contributions to tax-favorable retirement funds
Employment eliminates this in addition to adding several additional taxes (workers comp, unemployment, etc). These expenses are passed down to the employee in the form of reductions in wages.
So the implications of making large populations of self employed workers actually employed has great tax benefits for the government, at the expense of the worker.
Uber, Lyft, DoorDash stocks fall sharply after U.S. Labor secretary says gig workers should be classified as employees
https://www.cnbc.com/2021/04/29/uber-lyft-doordash-stocks-fa...
Do you exist? Or is it always a bunch of privileged people blathering on about a situation they have no first-hand experience in?
*Are there any more remaining worthwhile agencies under Labor? I’m going from memory here.
That could also solve the equity discrepancy, and give the workers real ownership upside.
Imagine if I sell my book on Amazon. Is Amazon the employer or my publisher?
If I rent my home out on AirBnB, is AirBnB by land lord or realtor?
If I offer to fix plumbing via craigslist, is craigslist my employer?
So, if I offer to much of my services on a platform am I to be employed by that platform?
The drivers of Uber and Lyft have opted not to be employees before. There seems to be some sort of political agenda here (maybe increase in taxes?), because no one seems to want this.
Individual plumbers are often contractors. If they work for a larger plumbing company, they'd be an employee. There are specific criteria at play here:
https://www.irs.gov/newsroom/understanding-employee-vs-contr...
> A worker is an employee when the business has the right to direct and control the work performed by the worker, even if that right is not exercised.
Uber sets the driver standards, how the work should be done, policies, pricing, etc. They clearly have some aspects of an employer/employee relationship. The line's a little blurry in spots; I can see both sides of the argument, and I'd say it's clear the law didn't anticipate this scenario.
They are person or company leasing labor aka providing services. The other items I listed were both services and goods.
The point is that you shouldn't force a platform to employ or act as anything other than what it is (a routing system). Uber is not directly employing people, it's connecting customers to produces of a service (taxis, effectively). It's also acting as the payment processor and price setter. Everyone can know what they're getting / paying ahead of time. It's a transaction.
The formal definition - see the IRS link - is substantially more complex than that.
I provide services to the company that employs me. I am not a contractor.
In that case Amazon is your book seller. They may also be a publisher through Kindle Direct Publishing.
> If I rent my home out on AirBnB, is AirBnB by land lord or realtor?
You'd best check in the jurisdiction where your home is, but it is more likely they would be a property management company.
> If I offer to fix plumbing via craigslist, is craigslist my employer?
This is a bona fide activity performed by contractors.
> So, if I offer to much of my services on a platform am I to be employed by that platform?
There is a reason why we don't see Uber drivers advertising on Cragislist but lots of ads on Cragslist to hire drivers for Uber.
1. We implement OBAMA care which allows most people to receive subsidized health insurance. Supposedly to cover the uninsured. Then pension plans, employers, gig companies take advantage of this fact and push the people to the marketplace. The cost of OBAMA care skyrockets along with all other insurance plans.
2. Gig companies do not have to carry employee tax liability on their balance sheet. Each independent gig work needs to do this. Would the IRS rather collect from 1 company or hundreds of thousands of independent contractors. Additionally, independent contractors are viewed as a business and can take substantial deductions. The combination of taking advantage of tax deductions, the cost to collect from all of contractors and the fact that a good number of contractors do not make their tax payments, leads to reduced revenue.
3. Personal mandate goes away and the Gig worker drops their health insurance or the personal mandate wasn't paid int he first place. By creating this scenario OBAMA care becomes unsustainable.
I worked 19 years as a contractor and loved it. Never was provided benefits. I purchased my own health insurance until the ACA came along and it doubled the cost the plan I purchased for my family year over year until it was unaffordable. I didn't want to purchase the terrible plans available through the marketplace so I got a job.
Gig companies are the 21st century robber barons.
However, Uber and other companies did start right after the dot-com recession, when people needed to both save money, and make extra money. It turns out a lot of people needed to do both. Sure, there were advantages over the previous incumbents (cabs suck), but that's not why there are so many drivers.
Ask your Uber or Lyft drivers sometime how often they work. Many of them, since the early years, told me they work as many hours as they can, for as many companies as they can, just to make ends meet. Of course they're paying for their car and all that themselves, too, so it's not like they're getting ahead. And they definitely would rather not be driving for 14 hours a day.
These companies exploit people in an unequal system in order to make profits.
> some government idea of enough pay
Misleading. There is an objective amount of pay that is or is not enough to live on in a given place. The government tries to guess at this sometimes, for the purpose of setting min wage, but that value is objective and exists independently. It's not some arbitrary bureaucratic thing.
If all jobs had to pay enough to "live on" then most of the people above would be able to work at all, because the jobs simply would not exist.
A) teens and retirees having access to low paying scut work jobs
B) eradicating wage slavery for non-teen, non-retirees by making it illegal for employers to pay poverty wages
I don't know if it's really such a simple binary opposition, but if it is, B for me.
Having hit this kind of thing when the Great State of California got interested in contractors a few years back I have to say that the cynic in me tends to come out on these issues.
So many people have a personal interest in this general issue, large companies who don't use contractors, large companies who do, health insurance mavens, the state wanting to extract a few bucks in things like unemployment insurance, people in the grievance industry, politicians generally, I think you basically can't trust any heartfelt opinions on the way-things-oughta-be.