Labor in the “Gig-Economy”

As millennials and college students we are the most understanding of the gig economy culture and lifestyle. We use applications like Uber, AirBnb and Lyft every single day. We have also grown more impatient and expect things as soon as possible (think Amazon 2-Day shipping and not waiting to hail a cab). As our economy has shifted into the 21st century, there has been an increased demand for technologically driven companies which expedite a previously inefficient industry. Due to this shift and change, there has been a large need for short term labor and independent contractors. In our seasonal and time driven economy, we need a labor force that is not only adaptable but also willing to not be stuck in a 9-5 schedule.

 Ride-sharing companies have tapped into the current need for cheap and convenient rides by using independent contractors as their gig workers. Companies like Uber promise large yet misleading salaries for their contractors. Uber promises a median salary of over $90,000. Compared to our low annual minimum wage, the gap is quite large. Workers are flocking to these companies hoping to make money on their own schedule. However, according to recent studies the ‘median’ salary is only possible if Uber drivers work for almost 80 hours a week. That’s not only unrealistic but it is also misleading to the drivers. In the state of New York drivers also need commercial licenses, commercial insurance and well maintained cars. While these features are meant to protect the passenger and increase their satisfaction, it comes out of the Uber drivers’ wallet.

Many cases have been brought around the world by current or former Uber drivers demanding to be considered as full-time employees rather than independent contractors. As independent contractors, they are able to set their own schedule and operate their own machinery (cars). However, they become ineligible for social security, healthcare, unemployment benefits and many other governments created programs to help employees. Uber along with many other gig economy companies prefers it this way because it saves money and increases profits.

In New York, Britain and California cases have been brought to reclassify Uber worker status. These cases will ultimately have a rippling impact on the entire worldwide economy. The courts have found, on a case by case basis, that the employees are full time workers and should be treated as such by Uber and under the law. In one case Uber tried to settle with their drivers for $1 each (yes $1 not a typo) to stay out of federal court and stay as independent contractors.

I believe that in our current system, we are not properly equipped to handle this new type of employee. They are necessary for company operations- which leads on that they are full time employees- but they are also working their own hours and should be treated as part time independent contractors. In my opinion, we should look at precedent and find a comparable employee.

In my opinion gig economy employees such as Uber drivers are like traveling salespersons. They travel around offering a product or a service for a commission. They are able to work their own hours and are able to be dropped by the parent company for poor performance. The comparison is striking and I believe that gig economy employees should be treated the same way. The vast majority of traveling salespersons are independent contractors and in my opinion gig economy employees should be treated as such as well.

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