From treatment of gig workers to tip transparency, the app-based economy could see key changes in 2022

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App-based “gig work” has been around for more than a decade, yet laws about how companies should treat the people doing that work are still inconsistent — or none at all.

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That’s starting to change, however, and 2022 could be a pivotal year for companies like Uber Technologies Inc. in the march toward equal treatment for workers who deliver food, ride rides, and perform other tasks. Uber,
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– which was launched in 2009 – DoorDash Inc. dash,
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and Lyft Inc. LYFT,
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When California tried to set a precedent that would require companies to classify gig workers as employees, the companies fought with Proposition 22, a big money ballot measure that carved out exceptions for gig companies. . The measure was approved by voters in 2020, but was ultimately ruled unconstitutional.

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The fight continues in California, while many more battles are underway. Gig companies are attempting to pass laws similar to Proposition 22 in other US states, while other countries are considering new rules on worker classification. There are also new rules and court cases that could be transformative, including addressing how much companies can earn workers, and the level of transparency of companies on distribution fees and tips.

Watch Uber Brand Gig Companies’ Efforts To Change Labor Laws To ‘IC+’

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UC Hastings College of Law professor Veena Dubal, who studies the gig economy and advocates for gig workers, said, “Efforts that have been going on for too long [could] Finally come to a head in 2022.

Regulatory and political pressure is mounting as workers inside and outside the gig economy demand more rights, higher wages and better working conditions; As local, state and federal governments increasingly scrutinize the Platform’s practices and policies; And as gig companies try to prove to investors they can be profitable.

“The back story of all this is rising income inequality,” said Katie Wells, a postdoctoral research fellow at Georgetown University, whose Washington, D.C., research center on the gig economy. Gig companies served a variety of needs, over the past few decades, she said. Took advantage of the weakening of labor rights, then “exacerbating rising inequality” because their business model is “predatory” towards their workers.

“They are not in the business of solving social problems,” she said.

worker classification

The main question for the gig economy is labor classification. Companies treat app-based workers as independent contractors – avoiding standard features of employment such as minimum wage, taxes and other costs – but many argue that employees fit the current legal definition of employees. A coalition of gig companies is trying to create a “third way” for these types of workers, while some governments are trying to mold them to existing standards, which would likely make them employees.

In the US, this week the National Labor Relations Board invite briefAfter some tough talks last year with US Labor Secretary Marty Walsh, who indicated action along the way, as of February 10, it should or should not reconsider its standard for determining workers’ independent-contractor status. Also this month, the European Commission proposed new rules that could lead to the reclassification of millions of gig workers in Europe, and India’s Supreme Court came up with a resolution seeking social security and other benefits offered to other workers by gig workers. agreed to hear the petition.

EU prepares plan to improve gig-worker conditions

But after what happened with Proposition 22 in California, it’s possible that the main battles will take place in individual states. Massachusetts could be the next big battleground if an industry-backed measure that would create a separate category for gig work qualifies for the November ballot.

“Massachusetts Has Been the Next Ground Zero” [for gig worker classification] In the US, and many other states are looking to see what happens,” said Shannon Liss-Riordan, an attorney who has represented workers in multiple lawsuits against gig companies. According to him and other experts, other states that could be the next stop for gig companies include Washington, Colorado, Illinois, New Jersey and New York.

Proposition 22, which was approved by California voters in 2020, exempts gig companies from state law and allows them to treat their drivers and delivery workers as independent contractors instead of employees. The Massachusetts measure may be the first indication of whether companies will succeed in their goal of expanding that model elsewhere.

Activist advocates say Proposition 22 falls short in California: Many gig workers still complain about inadequate wages, and don’t qualify for the health-insurance subsidies they were promised. Gig companies have said thousands of employees have received subsidies since the law came into force.

Read more about the record-breaking $200 million fight to sustain the gig economy

The European Commission proposal is in its early stages, but if adopted it could have a wider impact. This will require gig platforms such as Uber and its competitors in Europe such as Deliveroo ROO.
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To treat its drivers and couriers as “workers” entitled to minimum wage, paid holidays, unemployment and health benefits, and more. The Commission estimates that 4.1 million of the 28 million working gigs in Europe could be reclassified as workers under the EU directive.

The proposal follows a decision by the UK Supreme Court last spring that ordered Uber to treat drivers as workers, with some employment benefits, and a decision Uber’s business model was outlawed in London this month.

Uber did not return a request for comment about a European offer on gig work. A DoorDash spokesperson said the company is new to the European market and did not comment.

Elsewhere, a workforce advisory committee in Ontario, Canada, has recommended a third category for gig workers, similar to the type gig companies are seeking. The “dependent contractor” shall be entitled to basic employment entitlements such as minimum wage, minimum or basic benefits and termination pay. The same committee has also proposed a portable-for-profit plan like the one Uber launched in Canada earlier this year.

For more: As Uber and Lyft price hike, passengers return to basic ride-hailing service – Taxicabs

Ryan White, a labor lawyer in Canada, said Toronto’s government is “incredibly friendly” to business. “They will present it as, ‘We will empower gig workers.'”

Jennifer Scott, president of Gig Workers United in Ontario, agreed: “Uber lobbying hard, they use really well-rooted marketing language to hide what they’re doing. That what they are doing is progressive.”

Given the promises and transparency

Local, state and federal regulators and legislators are also looking at the promises gig companies make to potential workers and how much information (and tips) they share with those working. The US Federal Trade Commission recently warned gig companies and others that they could be fined up to $43,792 per violation if they mislead workers about how much they can earn on their platform.

Lois Greisman, associate director of marketing practice at the FTC, told Businesshala in October that the gig economy was “an area of ​​grave concern” when it comes to wage promises.

Uber, DoorDash, Lyft and Amazon could be fined billions if they mismanage wages, FTC official warns

DoorDash delivery workers say that the company — which has said its “dashers” earn an average of $25 an hour working less than four hours a week — doesn’t really explain how much they might earn.

“They don’t show the full amount up front,” said Lester Oliveros, who does DoorDash deliveries in Florida’s Tampa Bay area. Since the summer, DoorDash’s basic pay has dropped to just $2.50 per order, he said. The amount he sees on the app before accepting delivery doesn’t reveal how much the customer tipped, instead saying “the total could be higher.”

A DoorDash spokesperson said the company does this to try to give all workers an equal chance at “high-value delivery,” while some delivery workers say it’s a way for them to take low-paying orders. way.

Deep down: The pandemic has more than doubled the business of food-delivery apps. now what?

Christina Ashford, a DoorDash worker in Vancouver, Wash., began giving birth last year when the coronavirus pandemic began and her other work as a housewife dried up. She also said that the basic pay is as low as $2.50 per order. And if customers don’t tip when placing an order, but do tip afterward, they’ve found they sometimes don’t get the full tip, she said.

“I’ve never made $25 an hour,” she said. “No way, even when it was really busy… [considering the] My car, gas, wear and tear on stress, I probably made a max of $15 an hour.

This is about how much Oliveros has been earning on average recently: $15 an hour. He said that at one point he was making about $1,000 a week working 40 hours—that would be $25 an hour—but more recently he was working the same number of hours a week.

Don’t miss: How gig work widens the racial wealth gap – and what can be done…

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