This blog is littered with posts talking about the various states that are intent on creating a California-like legal test that would make it supremely challenging to classify workers as independent contractors. We’ve done several on New York alone, and that state’s efforts to adopt the ABC Test for themselves, just like California did with AB-5. And we’ve covered New Jersey. Meanwhile, Illinois, Wisconsin, Oregon, and Washington all seem like they might be the next California copycat.
I don’t know about you, but the nerd in me occasionally likes to play the “how far can it go” game with the gig economy. In other words, I oftentimes find myself thinking, “can the gig workforce fit in that industry or that kind of job?” And when I ask that question, I frequently find myself saying, “nah, surely not there.”
An international crowd of approximately 60,000 people attended the Web Summit Lisbon last month where one of the most pressing questions posed during the conference was: “How do we create a future of work that works for everyone?” As it relates to the gig economy, a three-person panel attempted to answer that question. And one of the panel members (Richard Socarides, the Head of Public Affairs at Gerson Lehrman Group) recently wrote an article highlighting the six big picture takeaways from the panel discussion.
I couldn’t help but be struck by two recent headlines which appeared to stand diametrically opposed in answering the question of who is driving the gig economy.
One headline from World Finance touted the driving force of the Millennials – “As more Millennials are choosing to freelance, employer must evolve to suit employees’ needs.” The tagline for the article then issued the following proclamations: “Millennials are going freelance in their droves. Companies will have to transform beyond recognition to lure modern workers away from the freedom of being their own boss.”
GrubHub, the food delivery app, has been in a legal battle with a former delivery driver over the driver’s classification as an independent contractor since 2015. Initially filed as a class action in state court in San Francisco, the case was removed to federal court where U.S. Magistrate Judge Jacqueline Corley of the Northern District of California ruled in 2016 that the case would not proceed as a class action. In the most recent news from the case, Judge Corley indicated that the case will proceed to a bench trial on the key issue of whether the driver was properly treated as an independent contractor or whether the driver should have been a W2 employee. Like Lyft and Uber, GrubHub utilizes on demand workers – who are treated as independent contractors – through smartphone apps. So a trial decision in the GrubHub case would certainly have a major impact on these and other gig-economy companies.
An influential member of Congress recently provided some hope that statutory relief for the ill-fitting wage-hour rules as applied to gig workers might be considered by Washington in the not-too-distant future.
Many point to the Brexit movement as a sign that Donald Trump’s White House victory should have not been a surprise. Will a potential movement afoot in the United Kingdom be a precursor of things to come in the gig economy for the United States?
Much has been written about sharing economy companies such as Uber and the like whose very core is fueled by a contingent workforce connected to consumers through a digital platform. But a recent report stresses that even more traditional employers are “reshaping their talent management initiatives” with the understanding that the definition of “contingent labor” itself has taken on a whole new meaning. The report – “The State of Contingent Workforce Management 2016-2017: Adapting to a New World of Work” – was published by Ardent Brothers (in conjunction with SAP Fieldglass) and includes a wealth of knowledge for businesses trying to “thrive in this new corporate paradigm.”
Uber and Lyft, perhaps two of the most widely known gig economy employers, have resolved their nearly two-year legal battle which started when Lyft sued Travis VanderZanden, Lyft’s former COO, who left Lyft and became a top executive at Uber.