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Wednesday, July 24, 2019

Classifying Gig Workers Misses the Bigger Picture

I have a new article out today in the Harvard Business Review - The Debate Over How to Classify Gig Workers Misses the Bigger Picture.

I'd love to get your thoughts. The question of how to regulate platforms and how to classify workers is heated and as this post suggests, scholars have been suggesting middle categories for some time. As a non-American my first exposure to employment and labor law was through the law of work - defying categories and distinctions with an attempt to focus on the substantive goals of fairness and protection. I wrote an early piece drawing on that comparative experience, The Four Pillars of Work Law, Michigan Law Review. Since then I have written a trilogy of article on digital platforms: The Law of the Platform; Platform Market Power (with Ken Bamberger); and The Gig Economy.

I this short HBR piece today I address the current California negotiations and initiatives, after the California Supreme Court's Dynamex decision. I suggest we should focus on the underlying goals of each of the patchwork of rules, regulations, rights and protections and reject a one-classification fits all broad brush solution. 

Posted by Orly Lobel on July 24, 2019 at 04:34 PM | Permalink


Orly, you may find great interest here( and links therein):

" New York governor signs workplace sexual harassment legislation"


Posted by: El roam | Aug 14, 2019 4:50:33 PM

Peter --

Although it's just one issue in a much more complex set of considerations, the minimum wage issue for TNC drivers isn't as complicated as one might think. Ross Eisenbrey and Lawrence Mishel wrote a really nice piece on this a few years ago: https://www.epi.org/publication/uber-business-model-does-not-justify-a-new-independent-worker-category/.

A few highlights from their piece (some are general points that others have made):

- drivers are not, in fact, so very free to turn down rides. If you don't respond quickly enough (usually 15 seconds) a "missed" ride request counts as a rejection, and a certain percentage of rejections carries punishments up to being kicked off the app. That's roughly analogous to saying "you're free to not show up for work [but if you miss enough days you'll be fired]."

- given that drivers aren't so free to reject rides there's a limited sense in which they can do other things (run for groceries, pick kids up from school, take a nap) while the app is on. That limited ability to do non-work stuff exists in non-gig jobs too, and we have ways of analyzing whether an employer is nonetheless responsible for paying for that time an employee is hanging around. There are ways of achieving this in the TNC context too (I won't spoil the fun since Eisenbrey & Mishel do such a nice job of explaining it) even given the option to be active on multiple TNC apps at once. Perhaps nothing emphasizes the feasibility of calculating a minimum wage in this scenario so much as the fact that Uber has long offered minimum wage guarantees to select drivers.

- the idea that TNC apps would lose money if they had to pay minimum wages to drivers outside high-demand zones overlooks two things: (1) the apps already pay differential wages and charge differential rates [because of dynamic pricing] based on location so this is more about setting a new floor rather than introducing the very concept of a floor (2) we don't generally accept the argument that financial burden is in itself enough to not pay the minimum wage. It's true the FLSA does not cover *all* employers... but it covers almost all of them.

Posted by: DDA | Jul 25, 2019 1:33:41 AM

The minimum wage issue seems like a particularly difficult one for gig workers. Do you only require the minimum wage requirement to count the time actually moving passengers? If so it’s no real protection at all. On the other hand requiring it apply at all times they have the app open deeply restricts flexibility as it means someone in a low use area will have to be denied the option to leave the app on while they do other work (say delivering packages) since ride-share companies must pay minimum wage with respect to all time the app is open and don’t geofence the feature you’ll have drivers hiding out in deeply rural areas to get paid for nothing.

Also how do you allow minimum wage rules while leaving workers the same freedom to turn down rides? Again if the minimum wage is only evaluated against time actually driving a passenger it’s going to be laughably pointless. But then you can’t let drivers turn down a bunch of rides lest they get the minimum wage limits by doing nothing.

More generally the arguments against the minimum wage seem the strongest relative to gig workers in that (as a side job where workers choose their own hours) there are going to be much more benefit to lost if rideshare companies have to deny workers from picking up rides in an area where the incidence of rides needed isn’t large enough to cover the minimum wage costs. Moreover, it doesn’t reflect the facts that many rideshare drivers work for multiple gig companies simultaneously deciding which ride to take on a per ride basis. Which company is liable for that minimum wage? If the employee could have earned minimum wage by adopting the right package of gig services would a company have to pay it because that worker choose not to combine ridesharing and package delivery? You don’t want to discourage people from allocating their own time here and implicitly favoring horizontal integration so you can manage workers time between all services.

Posted by: Peter Gerdes | Jul 24, 2019 8:37:09 PM

Just the legal definition of " vicarious liability":

Vicarious liability refers to liability for the negligent or criminal acts of another person that is assigned to someone by law. Vicarious liability exists when liability is attributed to a person who has control over or responsibility for another who negligently causes an injury or otherwise would be liable. Whenever an agency relationship exists, the principal is responsible for the agent's actions.

For example, an employer of an employee who injures someone through negligence while in the scope of employment is vicariously liable for damages to the injured person. In contrast, a defendant who engages an independent contractor is not liable to others for the acts or omissions of the independent contractor. An independent contractor is a person who performs services for another person under an express or implied agreement and who is not subject to the other's control, or right to control, over the manner and means of performing the services.

Here, cited from legal dictionary ( USLegal ):



Posted by: El roam | Jul 24, 2019 6:44:14 PM

Just correcting my comment:

Should be "harassment" instead of "embarrassment" of course.


Posted by: El roam | Jul 24, 2019 6:22:18 PM

Important, and very well defined by you Orly:

Striking balance between : Protection on one hand, and flexibility on the other. Precisely so. Yet, one should not forget, that there are social values or purposes, outside of it. Have to do, neither with protecting the employee necessarily, nor, nurturing flexibility ( although may affect them both).Example:

Sexual harassment. Many women experience and report on sexual embarrassment from gig drivers. Now, who would bear responsibility for it in vicarious terms ( " vicarious liability" ). Would you argue, that Uber for example, has no responsibility at all ? To prevent or educate about it. This is a separate issue, one must handle, legally handle.

Here for example:

"Uber sued for $10 million by woman who was sexually assaulted by her driver"



Posted by: El roam | Jul 24, 2019 6:19:52 PM

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