The San Francisco city attorney’s office announced today that it has reached a settlement agreement with gig-staffing company WorkWhile, the second worker-classification victory this year from the city’s newly formed Worker Protection Team.
WorkWhile, a San Francisco-based gig company that connects workers with temp work, will pay $1 million to thousands of workers the city claimed were being denied rights and benefits. It will also permanently reclassify all its current and future workers, except delivery workers, as employees rather than independent contractors.
The judgment came on Dec. 10, about 10 months after San Francisco secured the country’s first injunction to require a gig company — in that case, Qwick — to permanently reclassify its workers.
WorkWhile has grown rapidly since its launch in 2020, with half a million workers now operating across 27 states, according to the city attorney’s office. Its workers are matched to businesses to fill empty shifts in warehouses, food service, delivery, event services and general labor.
The workers sent by WorkWhile to different businesses were classified as independent contractors, but often did the same jobs as those businesses’ employees.
The settlement only applies to workers not engaged in delivery, like hospitality workers and warehouse workers — about 3,500 to 7,500 of its workforce in California. The city attorney’s office is continuing its litigation regarding the company’s delivery workers.
The case, said City Attorney David Chiu, is “part of our ongoing, groundbreaking work to fight misclassification and prevent gig-app misclassification models from taking root.” Chiu in 2022 created a Worker Protection Team in his office to litigate instances of employee misclassification and wage theft, including that of WorkWhile and Qwick. The city attorney’s office sued WorkWhile back in June.
WorkWhile co-founder and CEO Jarah Euston said in a statement, “This is about expanding opportunities for workers and providing them with maximum flexibility to chart the course of their own careers.”
The stipulated partial judgment and injunction was approved by the San Francisco Superior Court on Dec. 10. Moving forward, non-delivery workers will enjoy workplace protections and benefits for employees, including overtime pay, paid sick leave, paid family leave and workers compensation insurance, according to the city attorney’s office.
“We will not tolerate companies … attempting to shift costs onto workers,” said Chiu. Instead of providing workers compensation insurance, WorkWhile charged its workers a “Trust & Safety Fee” to fund “a substandard insurance-like product,” according to the city attorney’s office.
Misclassifying employees as independent contractors also allows a company an unfair business advantage over firms that offer employees’ benefits, like healthcare and workers compensation. The new settlement “will help ensure a level playing field for law-abiding competitors in the staffing industry,” said Chiu, and sends a message “to everyone in this industry and others that you have to play by the rules.”
The $1 million will be split between the 3,500 to 7,500 applicable WorkWhile workers, and Chiu’s office will decide how much each one receives after receiving shift data from the firm.
Any money unclaimed by workers in the $1 million restitution will be paid to the city in civil penalties and used to enforce consumer and worker protection laws, according to the judgment. Between Feb. 3, 2025, and Jan. 1, 2027, the city attorney’s office will monitor WorkWhile’s compliance with the agreement.
It is about time to go after those leeches.
How much did the city spend on its Worker Protection Team to obtain the $133.33 to $285.71 settlement per worker?
Gosh, just wait until you find out how much it costs the city to arrest, book, prosecute, and jail someone who steals one *thousand* dollars of stuff from a Walgreens. These people stole one *million* dollars!
As I hope you’ll agree, the value of enforcing the law when someone steals from a Walgreens isn’t just about the value of that one theft. It’s about deterring other thefts — making people who are tempted to cheat understand the law applies to them. And it’s about shifting us a bit more towards a society where people feel safe and expect others to follow the law. Same goes for enforcing the law when someone steals from workers.
My son only got $4.13 – and had to pay 1099 taxes since some of the work was classified as “independent contractor”. He’s a student making less than 5k a year and had to pay taxes.
San Francisco has a budget of $15.9 billion for 2024/25. And, although we are facing a major budget shortfall, I’m sure spending can be better prioritized. For example, the San Francisco Dept of Public Health just hired a “fat activist” to consult on “weight stigma.”