Today’s News & Commentary — April 30, 2019
The Department of Labor issued a new opinion letter saying that the Department considers gig workers in the so-called “sharing” economy (like Uber drivers or Instacart shoppers) to be independent contractors, rather than employees. The letter is a notable shift from the Obama Administration, which issued guidance suggesting that gig workers were probably employees — which the Trump Administration rescinded in 2017. Gig economy companies face massive lawsuits from workers who claim they have been misclassified as independent contractors — and thus have been illegally denied important protections like the minimum wage, overtime, and rest breaks that only apply to employees. The Labor Department writes that the “touchstone of employee versus independent contractor status has long been ‘economic dependence’” and applies a six-factor test to determine whether gig workers for at least some “virtual marketplace compan[ies]” are economically dependent. The six factors are:
(1) The nature and degree of the potential employer’s control;
(2) The permanency of the worker’s relationship with the potential employer;
(3) The amount of the worker’s investment in facilities, equipment, or helpers;
(4) The amount of skill, initiative, judgment, or foresight required for the worker’s services;
(5) The worker’s opportunities for profit or loss; and
(6) The extent of integration of the worker’s services into the potential employer’s business.
As senior contributor Charlotte Garden pointed out, the letter characterizes “the ‘control’ factor in a way that platforms are going to be very happy about, relying heavily on workers’ abilities to ‘multi-app,’ and not on more subtle methods that (some!) platforms use to exert control over how work is done.”
On Monday, the Supreme Court denied cert. in a case challenging exclusive representation. In Uradnick v. Inter Facutly Organization, a Minnesota public university professor named Kathleen Uradnick is challenging a state law that allows public employees to select an exclusive representation by majority vote. Uradnick argues that exclusive representation abridges her First Amendment rights as a non-member, although the union was selected by a majority of her co-workers in place. The cert. denial leaves the Eighth Circuit’s decision upholding exclusive representation in places — but in the wake of last summer’s Janus decision, some commentators believe that anti-union groups will keep pressing for the Supreme Court to hear a challenge to exclusive representation.
Uber and Lyft drivers are planning a massive eight-city strike on May 8, planned as Uber prepares for its initial IPO. According to CBS news, drivers are calling for a minimum gross wage of $28 an hour, which they say amounts to “$17 an hour after gas, tolls, and other expenses.” Drivers’ demands new wage rule issued by New York City which requires that drivers in the city be paid a minimum gross wage of $27.86 an hour — and follow a study released last year showing that drivers’ median pre-tax profits were just $3.37 an hour and that almost a third of Uber drivers lose money, accounting for costs. The strike is planned to last for 24 hours.
Amazon is facing criticism for a new automated system that tracks times that warehouse workers pause or spend taking breaks, issue automatic warnings, and even automatically issue termination paperwork if workers don’t meet Amazon’s strict production goals. Workers report that they’ve felt so pressured by production targets that they don’t even take bathroom breaks.