As I wrote previously, it is no secret that labor laws have been unable to keep pace with the changing economy, despite challenges from the bench to address the needs of the gig economy. Certain state legislatures (e.g. Washington) have taken steps to address needs of gig workers, with their ‘Paid Family and Medical Leave’ program expanded to include self-employed workers. And efforts to make portable benefits available to the gig workforce are ongoing, mostly at the state level. However, federal legislative and regulatory entities are seemingly mulling their options and allowing the change to occur from the bottom. Voices from the gig upper strata are becoming impatient, and want immediate legislative change, at the top.
The California Supreme Court issued its long-awaited decision in Dynamex Operations West, Inc. v. Superior Court last week. The weight of the court’s decision to apply a three-prong test to determine whether a worker is an employee is heavy, without a doubt. As my colleague Rich Meneghello says, the decision will “appear in the nightmares of gig economy executives.”
Offering health, retirement, and workers’ compensation benefits to the varied gig workforce, while maintaining some affordability to the worker while also avoiding the 30 percent cost increase to businesses, has proven to be an extremely tall task. The situation gets even more complicated because gig businesses also need to be concerned that charges of worker misclassification could be supported by the offering of such benefits to their contractor workforce.
It is no secret that labor laws have been unable to keep pace with the changing economy. Recently, however, it appears the effort to spur change has been resuscitated, as proposals come in from the left (former SIEU head Andrew Stern) and the right (R Street Institute’s Eli Lehrer and Garret Watson), and pressure is applied from the bench (eastern Pennsylvania federal judge Hon. Michael Baylson).
In a case previously discussed by my colleague Linda Gulledge, a federal judge in eastern Pennsylvania has rebuffed Uber once again in its attempt to rid itself of potentially expensive wage claims. In December 2016, as Linda described, federal judge Michael Baylson ordered “expedited discovery” on the issue of the compensability of UberBlack drivers’ on-call time. Fast forward about nine months.