This is just such a weird fight. As someone who freelanced for long stretches of time, I think there are a lot of positives about freelance / gig work, and I also think that the majority of people who take these jobs understand the position they’re in and are happy with it. They chose to freelance and drive for Uber for reasons.
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.
No one's saying you can't freelance. But there are some pretty clear rules about what you should be able to do in order to really be a freelancer: choose which jobs you take, set your own hours, decide how you want to do the job, how you dress, etc.
What's not OK is when the company wants all the advantages of having contractors but still wants to dictate all these things.
I think you might be more in agreement with the original comment than how I interpreted your comment.
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.
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.
It is not just that. The biggest test for contractor vs employees is IRS classification. If a person earns majority of their income from one entity, then they are classified as employee. There is no official percentage cutoff like 51% or even 95%, IRS supposed to look at the whole situation.
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.
The rules around that are pretty clear already. And in the case of Uber, you not only can drive when you want, you can drive for multiple providers at the same time.
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.
Coming out of high school, one of my first jobs (during my college years) was selling knives as a gig. Since we weren't employees, they couldn't necessarily say "come in on these hours", but there were meetings scheduled at the beginning of the day (where we'd get the next list of customers to call and/or sell knives to), among other stuff.
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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.
Wanted to chime in with my $0.02 regarding barbershops. My family owned a salon growing up. I’m sure you’re right and abuses exist. But in my experience, the shop is a landlord. The independent contractor rents a chair. They can come/go at will. Having a schedule is useful so not everyone is there the same time fighting over walk in traffic. People regularly no show and that’s ok too.
That's a good point. One suspects tho that governments are more interested in getting the "proper freelancers" to be treated as employees, since they usually have higher earnings and therefore offer higher revenue possibilities. The UK is going through a similar reform process right now and lots of people are being classed as employees and therefore taking massive pay cuts. End the end, you end up with temporary workers who're taxed as employees but have almost none of the benefits of permanent employees (in the UK at least).
> 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.
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.
Couldn't agree more. If it were up to me, we'd get rid of the minimum wage, let employers pay whatever they want, and then provide UBI to make sure people have their basic needs fulfilled.
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.
The problem with this is that corps basically have full knowledge of the market, what they can afford, how much they can pay overall, but employees know none of that. That's were the minimum wage comes in to provide a floor. I know that in your scenario that UBI covers that, but if UBI is equivalent to 40hrs of $15 an hour a LOT of people aren't going to do anything other than play vidya games all day as the rest of us support their addiction.
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.
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.
> 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.
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.
That makes sense to me: I specifically think that employer provided health insurance is problematic because it means the wealthy and powerful in the US have no idea how painful it is for the “average joe” to deal with insurance. If all the executives in the US had to buy their own coverage via our system, I think there would suddenly be a new huge and well-backed lobby for reform.
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 first paragraph, I quote Supreme Court Justice Learned Hand: “Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one's taxes.”
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.
> For example, require freelance employers to include expense tracking and calculate workers earnings after expenses.
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.
This is a fair point. I honestly don’t know the exact details that would make the best solution, but it seems like we should be seeking to regulate this kind of “platform work” to specifically target the problems that it has, rather than sweeping it all under the broad brush of “freelance vs employee.”
Thing is most of the regulatory infrastructure you describe already exists in employment law. The broad societal proposals you describe would necessitate a radical reappraisal of contract law and a lot of other things. To use the popular 'ship of state' metaphor, it would be sort of like dramatically reconfiguring an aircraft carrier while it's at sea.
I guess that is what is happening here...fixing any problems using the existing model instead of trying to figure out new ways of fixing the problems to fix the new model of employment in some industries.
We elect lawmakers, not lawkeepers. It is their job to update the laws to keep pace with society, not restrict society so existing laws remain useful. In the 'ship of state' metaphor, we're never going to be closer to a drydock and we need a hospital ship not an aircraft carrier.
In general this is a result of the mindset which says "I know better than you how your earnings should be allocated" combined with the idea that employers are much easier to regulate top down (through regulations, fines, licensure, etc.) than individual employees are. Taxation/governmental revenue boards or organizations struggle as is to keep individuals honest, and adding the burdens and complexities of business income/expense reporting to individuals is just begging for more (unintentional) disconnect between what they expect to receive vs what an individual expects to pay. Not sure either direction (employee vs contractor) is a good solution here. More likely a simplification of the system is needed.
Freelancing or being a contractor cannot be compared to being a gig worker. All discussion based on "I prefer being a contractor instead of employed" and then extrapolating that to gig workers is meaningless. For instance, a gig worker can't set their own rates, choose clients, no upwards mobility, often in an exploitable position etc.
Ok, but the legislation in CA that was aimed at uber already negatively impacts me and my work as a freelancer consultant in a variety of ways and ironically uber is now exempt.
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.
As someone who doesn't have any skin in this game, I too think the about the same things. That we are going towards fixing any problems by forcing companies to make gig-workers employees instead of fixing the systemic problems in the gig-economy in other ways. To me having the freedom to freelance while making decent money seems to be a tremendous benefit giving people lots of flexibility.
It makes sense if you realize that the current US Labor Secretary is a product of union politics (he was as union leader, and most of the political goal of classifying gig workers as employees is to make it easier for the AFL/CIO and Teamsters to unionize them.
The previous secretary of labor (the late Justice Scalia’s son) was an anti-worker ideologue who did everything possible to undermine/block the department’s mission, including helping firms to not provide health benefits, steal workers’ overtime pay, discriminate against women and minorities, avoid occupational safety rules, unlawfully block union organizing, etc.
It is a good thing for the leader of a government department to have ideological goals broadly aligned with the mission of the institution.
Sure that may be true, but to what end? To allow workers to ask for better rights rather than being at the whim of a microeconomy created by a company like Uber or others with their own control over "surges" and "down times"?
(new account, long time reader, victim of poorly self-managed passwords)
It blows my mind that these platforms refuse to let workers set their own rates, choose their clients, choose how the work gets done, where the work gets done and how the work gets done. Those are the defining characteristics of what makes a worker a contractor or not.
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.
Workers actually could set their own rates higher but Uber puts a floor on how little a ride can cost. Uber tested this feature and found that everyone who set a rate higher than Uber's floor amount didn't get a ride...
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-...)
To me it sounds like a service like Uber requires so much control over their product that they just can’t use gig workers/independent contractors.
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.
No one said it's an easy business. Your arguments are basically "if they don't get control over that, then it's hurting the business".
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.
That discrimination is the onus of the independent contractor drivers. Without full transparency about a potential ride's pickup, drop off, and how much they will be paid for it, there is effectively no way to argue that Uber drivers are independent contractors.
> 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.
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.
You did a good job describing constraints Uber has in order to deliver a product to customers. From your description there might be good reasons for those constraints such as anti discrimination or price stability. But even for "good reasons" it doesn't absolve Uber of liability for treating employees as contractors.
In your reply I see a theme common in most defences of Uber, it boils down to "without X, the business would not work"
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.
> 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.
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.
Uber is the client, not the person the driver picks up. The drivers are contractors, and they contract to Uber (or Lyft, etc) to do some job, in this case driving some person to a destination.
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.
A lot of those don't apply to the likes of uber and doordash though. An uber driver can't choose where the work gets done because the where is part of the gig itself. The how as well, as that's basically part of the task. Seems to be we're fundamentally trying to force an old classification to a new set of jobs.
A traditional independent contractor would choose which jobs they take. Many musicians, for instance, might turn down a gig because they don't want to drive to the location, or might ask negotiate for more money because of it. A guy mowing my lawn might ask for more money if my lawn is particularly difficult, or deny the job if we can't come to an agreement. Rideshare apps deny their so called "contractors" this freedom that most contractors have. They could certainly give their drivers the ability to negotiate terms, as every other contractor gets to do, but they don't. It is the denial of this freedom that makes them employees.
> An uber driver can't choose where the work gets done because the where is part of the gig itself.
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 is trivially beatable by Uber by just allowing these to be configurable and setting the defaults on the client to exclude those people.
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.
> Being an independent contractor does not mean being independent of rules
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.
> The defining aspect of these gig worker jobs is that independent contractors _can_ decide when and how to work.
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 is one thing that confuses me about the drive to classify Uber drivers as workers. Admittedly anecdotal, but when chatting with drivers, it seems like a fair number drive part time to make some extra money. I don't think they really want to be classified as employees of Uber.
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.
It seems backward that the government, instead of fixing government policy and laws that disadvantage independent workers, wants to force independent workers to become employees so that the government doesn't have to fix anything. It is abdication of responsibility for social outcomes.
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.
Under the law as it is written, the labor secretary is basically correct. It's not the labor secretary's job to rewrite the law. What congress should have done several years ago is to address the emergence of the gig economy with a new designation that is distinct from both independent contractors and employees.
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.
You're putting a lot of weight on the word basically in your first sentence - the reality is that gig workers have characteristics that clearly fall under the classification of employees and others that clearly fall under the classification of contractors.
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.
In the UK apparently there are 3 types. The Economist wrote on the Uber case in UK:
“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.
>Lots of issues in modern US business arise from laziness / stupidity / corruption / uselessness of Congress.
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's not the labor secretary's job to rewrite the law
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.
I disagree. There are jobs that are reasonable under the construct of "independent contractor". The issue is that the classification has been grossly abused to the point where the majority of people who employers attempt to classify that way really shouldn't be eligible.
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.
Isn't the solution here to turn contractor vs employee issue into a question of choice and benefit for the employee vs the employer? If retirement, time off and health benefits are also equally available to contractors then people can make the choice for the type of work they want without being disadvantaged.
According to an Uber survey in October, 20%, of uber drivers are unsatisfied working for the company [1]. If you want to work for Uber, and you can work any time you'd like, why would you be dissatisfied with working there? The reason people work for Uber is that it's available as an opportunity, with a fairly low bar of entry, in a way that a lot of other employment opportunities are not.
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.
> According to an Uber survey in October, 20%, of uber drivers are unsatisfied working for the company [1]. If you want to work for Uber, and you can work any time you'd like, why would you be dissatisfied with working there?
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.
So if the other 80% are satisfied working there because they get to pick their hours, it is best to change that because the 20% would be more satisfied with a full-time job and benefits?
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.
It's not a legal hack. If the government is not doing its job, these companies provide ways for people to make ends meet instead of going out to the streets to beg.
It makes sense if you realize that everyone wants everyone else to have a minimum quality of life, but everyone is also trying to pay/sacrifice the least to achieve it.
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.
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.
A "minimum quality of life" has nothing to do with your worker qualification. People can, and should, have the freedom to choose how they work.
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)?
> We want employers to provide benefits, as opposed to the government because that means higher taxes
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.
"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.
"It makes sense if you realize that everyone wants everyone else to have a good quality of life, but everyone is also trying to pay/sacrifice the least to achieve it."
And what defines a good quality of life depends on who you ask.
I’d say you have the first statement wrong - some will give but only not if they’re forced, some won’t give anything in any circumstance, and some would give a lot of not blocked by the other two.
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.
I don't want government or employers to provide benefits. I want people to keep their money and decide what is best for themselves. I don't believe the government or my employer has my best interest at heart, nor are they equipped to cater to my unique family needs..
Backwards as it may be it's far easier to change a regulatory interpretation or judicial test than to make a fundamental change to government services, like healthcare.
>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.
One solution to that is to allow employees to opt out of being employees.
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.
How long before Uber starts assigning mandatory job hours (as inconveniently as necessary to suit their needs) for drivers who have not opted out of employee status? I'd guess a maximum of two sprints.
> It seems backward that the government, instead of fixing government policy and laws that disadvantage independent workers, wants to force independent workers to become employees so that the government doesn't have to fix anything. It is abdication of responsibility for social outcomes.
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).
It seems to go without saying Employee protection laws are for the benefit and protection of the Employee. The law specifically prohibits employers from improperly reclassifying employees as independent contracts by simply titling a worker agreement/contract as an Independent Contractor Agreement in lieu of an Employment Agreement.
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.
> It seems backward that the government, instead of fixing government policy and laws that disadvantage independent workers, wants to force independent workers to become employees so that the government doesn't have to fix anything. It is abdication of responsibility for social outcomes.
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'.
"Many gig workers explicitly do not want to become employees."
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.
> 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?
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.
What, specifically, are those disadvantages? And are they actually related to employee classification, or are merely privileges not usually granted to employees?
If I drove for Uber/Lyft for moonlight income, I would prefer to paid purely in cash instead of being forced to be paid in health insurance, pto, etc. since all of that would be provided by my primary employer.
If you are a contractor, you are paid for every hour you work. If you work overtime, you are paid for it. If you work holidays, you are paid for it.
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.
For my wife, she can get more hours and higher pay as an independent contractor. Part of this is because we get insurance through my job. They also give her more autonomy than an employee would have.
> wants to force independent workers to become employees
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?
There's a lot of jobs as a driver where you are categorized as an employee. I work for Lyft so I'm familiar with most of the talking points and I'll reserve my opinion on which ones are bullshit or which ones are not. That being said, that _most_ drivers don't want to be employees is undeniable, and even on polls that unions conduct the outcome is something like half and half.
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.
You can (and actually must) work in both directions simultaneously. We can't do nothing in the hopes of sweeping changes. You have to work within the system that is in place even if you are also working to replace that system (and many are).
> 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.
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.
I always love the, "People are too stupid to make decisions for themselves" argument. People are more than adequate in making important decisions that directly touch their lives.
No, the government gets stuck picking up the slack when employers evade the law.
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.
In normal countries, the government provides you healthcare, no matter what your job is, or if you have a job at all.
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.
Not to mention that the people forced into the "gig" economy are often ADOS, black and/or latino. It helps to cement their bottom caste statuses in this country. The white/asian people on HN cling to their classist agenda and aren't willing to talk about race because of how privileged they are and how segregated their workplaces are. They just don't know the experience and make abstract claims about what is fair based on class.
Has anyone asked the gig workers how they feel about this? Do they want to be W2 employees?
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.
> But with contractors, the IRS only gets that money once a year,
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.
> IIRC this isn't true. Non-W2 earners are supposed to do quarterly taxes.
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.
Indeed - this is the real problem. We've bolted on so many things to the employee/employer relationship that should not be there. It's no surprise that contractor vs full time questions become so fraught when as a matter of policy, we've made that distinction hugely important.
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.
We disincentivize starting business (anti-entrepreneurial), work hour flexibly (anti-family), working independently (anti-individualism) and instead heavily incentivize reporting to a boss, on their schedule, at their chosen location, and getting paid only whatever you can convince them to pay you.
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).
This is the weirdest thing to me. Why do I get whatever health plan my employer selected? I shouldn't have to switch jobs to change my health insurance. And sometimes there is a delay before your coverage starts at the new pace, or I want to take a couple of months off. Now I have no coverage! This is nonsense. It seems that the main argument for it is that companies have more negotiating power, but that seems like it would largely change if there was a significant market for individual/family health insurance where competition can actually exist between the people who are benefiting.
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.
Absolutely, a job is a job. Or at least, that's all it should be. Yet the current law treats it something closer to an adoption of the employee by the company.
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.
> 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.
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.
The long term play isn't to use self driving vehicles anymore. Uber sold off ATG and Lyft just got rid of Level 5. They're dependent on others delivering commercial SDCs for them and anyone with the technical chops to do that isn't going to find the infrastructure of a ride-share service very difficult. As Uber and Lyft have both demonstrated, it's also straightforward to sell VC dollars for pennies to build up transport market share. The dominant theme of leading AV companies seems to be massive capitalizations, so it's hard to imagine the ride-share incumbents being highly competitive there either. It's hard to imagine a situation where their most profitable markets don't get immediately disrupted, leaving Uber and Lyft to figure out profitability with only the long tail low margin areas SDCs won't be deployed to for years afterwards.
The stock price is sure acting otherwise. I think uber's businesis cash flow positive, simialr to Amazon and Tesla, but that cap-ex and other non-recurring expenses are erroding profitability.
Let us remember that big tech companies like Microsoft, Google, Facebook generally have 49.9% of their employees contractors.
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
100% percent of the reason I didn't go work 'for' Microsoft was that I'd be a temp-to-possibly-hire contractor. And from the former contractors I'd talked to (one recommended by the recruiter!), it was clear contractors were treated like second-class citizens by Microsoft. From what I was told, contractors couldn't participate in networking events or even get free food employees got because Microsoft was sued for misclassifying workers.
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.
this is not isolated to microsoft, or the US. Everywhere I've worked, the contractors we've had have been treated like second class citizens. The smart ones even insist on it.
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).
> Let us remember that big tech companies like Microsoft, Google, Facebook generally have 49.9% of their employees contractors.
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 heard it years ago, can't find a source either. I believe it was something related to a court case. Some legal argument that could apply if total employees was over 50% contractors.
I'm waiting for the inevitable backlash when Uber starts cutting drivers off after 39 hours in a week to avoid having them classified as full time.
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.
> 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.
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.
FWIW, this is not my experience at all. As just one example, I was late to a wedding event in Phoenix shortly before the pandemic, was about to call an Uber ($35), and decided to take the taxi that had just pulled up to the hotel to save a minute. My total metered cost was something like $80.
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
I live in an area where the cab service was especially expensive, so it probably helps Uber. In the old days it was $25 to travel the 4 miles between my house and the airport. Lyft is closer to half of that last time I used it.
It's also going to be pretty bad when an employee-driver ends her shift 1 hour away from home and she has to drive back without the ability to make any extra money.
It'd be interesting to look at pricing by city. I bet they implement predatory pricing, i.e. undercut in small markets to crush competition, then raise prices.
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.
In NYC, your Uber driver is professionally licensed as a taxi/limousine driver and driving a vehicle that is registered as a for-hire vehicle. I'd bet this alone helps close the cost gap between rideshare and taxi, since there's nothing "rideshare" about it really - you're still paying for a professional driver with licensing costs, vehicle registration costs, extra insurances, sometimes even vehicle modifications, etc.
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.
Thought for Uber. License the software they already have (maybe at a certain rate and/or percentage of revenue) to the businesses and/or governments and let them handle the employee side of things
It might increase fares, although I'm wondering if that effect might be mitigated somewhat as drivers simply move hours worked whatever the cap is to some competing platform like Lyft.
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.
In my experience nowadays Uber drivers are just Taxi drivers who started Ubering in their own cars. I was thinking the other day how I used to get mints and water bottles and maybe a conversation. I get that about 5-10% of the time nowadays. I started using Black more often because I've taken dates in some Ubers that were practically falling apart, I'm worried about our lives in some of them along with some crazy driving.
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.
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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.
What's not OK is when the company wants all the advantages of having contractors but still wants to dictate all these things.
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.
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.
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.
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.
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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.
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.
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.
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.
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.
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.
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.
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It is a good thing for the leader of a government department to have ideological goals broadly aligned with the mission of the institution.
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.
(new account, long time reader, victim of poorly self-managed passwords)
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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.
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.
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.
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.
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.
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.
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.
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.
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.
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
https://bit.ly/3vqHHar
Which concludes,
"But in the end, the totality of the evidence is overwhelmingly in favor of wrestlers being more accurately classified as employees."
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.
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.
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.
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.
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.
“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 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.
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.
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.
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...
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.
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.
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.
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.
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)?
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.
"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.
And what defines a good quality of life depends on who you ask.
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.
>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.
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.
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).
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.
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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'.
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 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.
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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.
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.
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 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.
On what basis do you say this? Have you found good unbiased survey research?
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.
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.
The people who are not successful are independent workers who are dependent on an employer. The government cannot fix a logical contradiction.
Gig worker falls off a ladder and ends up a paraplegic. Guess who will be footing the bill?
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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.
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 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...
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They don't. They had a survey and that's why Prop 22 passed.
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.
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).
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.
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
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.
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.
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.