The rise of the gig economy has made it possible for anyone to make some money by driving passengers, making deliveries, or even walking dogs. As businesses reliant on this model have grown into money-making giants, scrutiny of the working arrangement has increased. Regulators and lawmakers across the country are considering actions that protect people working non-traditional jobs.
That includes right here in New York, where some early discussions could pave the way to a new reality for the state’s gig economy workers.
Some independent contractors may become employees
At the heart of this issue is one key question: Should gig economy workers (such as ride-share drivers) be treated as employees, rather than their current classification as independent contractors? For the workers, there is a lot at stake. Independent contractors are not protected by certain labor laws, such as wage and overtime requirements, nor are they eligible for unemployment insurance or workers’ compensation.
Classifying workers as independent contractors, rather than as employees, makes running a business cheaper for employers, in part because they get to avoid paying certain taxes. Our neighbors in New Jersey, recognizing this, are actually demanding Uber pay $523 million in overdue taxes, arguing that the taxes are owed because the company misclassified workers.
The future of the gig economy in New York
New York lawmakers will likely grapple with these issues during the 2020 legislative session. According to Crain’s New York Business, some legislators plan to introduce two bills aimed at giving independent contractors in the gig economy more power.
One proposal is similar to a high-profile law recently passed in California, which essentially reclassifies many independent contractors as employees, giving them the same rights as employees under the law. Another proposal would allow drivers of Uber and Lyft to unionize, giving them bargaining power they otherwise would not have.
The fate of these bills will be decided in the months ahead. They will likely face serious pushback from some of the more successful gig economy companies. It’s clear, however, that legislators and their constituents are increasingly concerned with worker rights in the gig economy.