The introduction of a new federal legislation in late July presages the spread of independent contractor status beyond app-based workers.
The Worker Flexibility and Choice Act, backed by lobbying groups from well-known corporations such as Google, Kroger and Target, “wouldn’t just help Uber and Lyft treat their drivers as independent contractors, but exempt virtually any American worker from minimum wage and overtime protections,” according to Slate Magazine. “They’re coming for everyone,” wrote Bryce Covert, author of the article.
Under the legislation, any worker who signs a “worker flexibility agreement” would be deemed an independent contractor, which means they wouldn’t receive minimum wage or overtime protections benefits.
The bill is unlikely to become a reality anytime soon, as it has not been assigned to any committee, according to Covert. Still, it reveals these giant companies’ ambitions for the future of labor. The wording of the legislation emphasizes worker “flexibility,” but critics claim this new model would favor employers, not workers.
“This bill would dramatically upend labor standards,” Brian Chen, senior staff attorney at the National Employment Law Project, told Slate. As a law, it might initially be most common in low-wage service sector jobs. But it would, theoretically, be a desirable alternative for any employer, including those of the “more professional or managerial-style jobs,” Chen said. If so, a future in which white-collar workers are mostly independent contractors may be just around the corner.
Insecure income creates a sicker workforce, a new study confirms
Critics have long suspected that, compared to traditional employer-employee relationships, the roller-coaster earnings of gig work would likely have a deleterious impact on workers’ health. This hypothesis is confirmed by a study to be published in September.
Based on national data from 2008 to 2019, researchers from the UTHealth School of Public Health in Houston, Texas, concluded that insecure income had a role in workers’ poor health conditions. Additionally, the lifestyle is likely to come with consequences. These include frequent illness and higher healthcare expenditures not covered by insurance, in addition to a reported 50 percent increase in psychological distress, compared to salary earners.
The study speculates these costs will be passed onto consumers. When workers received higher rates of hourly pay, this reduced, but did not remove, the correlation between insecure income and workers’ health.
Uber’s foray into overseas patient transportation reignites calls for regulating the gig economy
On Aug. 19, Uber chose Australia as Uber Health’s first stop outside the U.S. market, offering non-emergency transport services for medical appointments in the country, according to the Guardian. The service will allow doctors to manage rides from a digital hub, providing access to transportation services, even for patients without a smartphone.
Sam Brown, head of Uber for Business, ANZ, said that the services would “help streamline healthcare transport, reduce the strain missed appointments cause, and improve the overall patient experience.”
Local labor groups, however, are wary of the move. Australia’s Transport Workers Union national secretary, Michael Kaine, told the Guardian that Uber’s testing of the waters in patient transport makes it “clear the gig model of work will pervade every aspect of our lives, which is why it is so critical to get urgent reform in place, and in the right way.”
He added that “Through an absence of regulation in Australia, the gig economy has caused an erosion of workplace rights that has led to deaths, injuries, unfair sackings and workers ripped off the minimum wage.”
A month after a 2% layoff, Lyft is subleasing offices
As Uber expands, Lyft appears to be tightening its belt. Lyft Inc. announced last Tuesday that it would sublease some 45 percent of its 615,000 square feet office space in San Francisco, California; New York City, New York; Nashville, Tennessee; and Seattle, Washington; according to the Wall Street Journal.
The cuts are said to accommodate the growing number of employees working from home. The company notified its 4,000 office employees in March that they could work remotely on a permanent basis.
The sublease came only a month after Lyft terminated almost two percent of its employees, mainly workers in the global operations team.
Lyft Rentals, Lyft’s own rental service launched in December, 2019, was also shut down, as first reported by the Wall Street Journal. Meanwhile, Lyft’s service based on partnerships with rental car companies Sixt and Hertz are still in operation.