Traditionally, the workforce is made up of two kinds of people: independent contractors and regular employees. What about the employee rights of people who drive for Uber, or work for any of the dozens of on-demand services? They aren’t hired on for a specific job or period of time like a contractor. But they aren’t really full employees either.
The idea of Uber and other services like it is that workers can accept the jobs they want and work only the hours they want, provided that there is a demand at that time. Since these companies are built on the fact that people want certain things as quickly as possible, and that demand always fluctuates, it makes very little business sense to have employees working traditional hours. If they did, they might be waiting around doing nothing for several of those hours until someone logs onto the app and requests immediate delivery of a burger from the place down the road.
Instead, the workforce of these companies is made up of people who simply have the time to run down to the burger place and deliver the food. Virtually anyone can accept the job, and will get paid for each errand separately. This is called a “gig economy”, meaning workers accept and are paid for gigs—short jobs—as opposed to traditional working hours and contracts. However, the downside is that the pay rate can fluctuate seemingly without warning, and can make employment contingent on things like approval rating (as Uber has done).
Problems Facing Gig WorkersThe biggest issue with a gig economy is that workers have no guarantees. If the company lowers their rates, as Uber has done in many cities, workers get less money and have no way to protest. Their only options are to accept less money or leave the business. The companies stand to benefit from this for as long as there are people willing to take gigs. And for on-demand companies that have very few regulations on who can sign up to work for them, the number of people to work gigs is potentially the whole population of an area.
Gig companies also do not offer benefits to their employees, and there is no standard for overtime or paid leave. Efforts have been made to start group associations capable of influencing these companies, and several class-action lawsuits have been filed against on-demand service companies. Popular opinion is that a third class of worker, called “independent workers” by many, must be created in order to cover people working in the gig economy.
The emergence of online businesses that exist solely to satisfy people’s need for near-instant gratification of their needs has created a unique situation in the national economy. A new kind of worker has emerged, and with it new questions about the rights of employees have emerged as well. These questions have not yet been answered. The business model of these companies may need to be changed to ensure all workers are given the full rights of employees. Or new laws may need to be drawn up to guarantee protections for these gig workers. Either way, the gig economy is going to be changing, and soon.
Dan Atkerson has been fighting for employees’ rights for over 30 years, and can answer your questions about your employment classification.