The shift in "employment," if you can call it that, in the last few years has been away from traditional employer-employee contexts and into what has been termed the "gig economy." This is the sort of ad hoc, off and on relationship between worker and company that is exemplified in places like Uber, Lyft, AirBnB, Etsy, and Fiverr. Instead of being dedicated to a particular employer with a set schedule, or (in the case of things like AirBnB), having to dedicate a space to commercial activity full time, our time and our things are going in and out of personal and business use as our whims dictate.
The advantage of this has been the ability to earn money very quickly and easily using assets (a car, your time) you already have, without going through an application process against other potential hires, and the ability to say "no" when you want, instead of committing yourself to a schedule or employer's dictates ahead of time.
The downside is that a lot of the traditional protections afforded to employees simply don't apply when you are a gig economy "contractor" instead of an employee.
Research is recognizing the growing threat this places on the lives of workers:
Among traditional contingent workers, increased rates of fatal and non-fatal injuries may be explained by differences in training and fear of job loss, as well as by employment in high-hazard sectors such as construction or agriculture.20 However, both offline gig work in transportation and services and online gig work are characterized by a number of well-characterized health and safety hazards. Road traffic safety, interaction with the public, use of household cleaning agents, intensive keyboard activity at poorly-arranged workstations present known hazards for which preventive measures exist, although the regulatory framework for prevention does not apply in the absence of an employment relationship. Health and safety risks could be anticipated to be worse in gig work because of the loss of the protective effect of working in a public workplace, as much gig work is transacted in private automobiles or homes.21 Younger age is a well-known independent risk factor for occupational injury. Chronic job insecurity, known to contribute to poor overall health among contingent workers, may be as salient among gig workers.
This has led to legal challenges:
Freelancers and contract workers make up the fastest-growing segment of the American workforce, and are expected to surpass half of all workers within a decade. But, under current employment law, these workers are ineligible for most of the rights and benefits of traditional employees.
As their ranks grow so, too, do the court challenges from workers who say they are improperly classified as contractors, and wrongfully denied eligibility for things like unemployment insurance, workers' compensation, and protections under most federal anti-discrimination laws.
One such plaintiff has even been successful, albeit in the outlier state of California:
In a ruling with potentially sweeping consequences for the so-called gig economy, the California Supreme Court on Monday made it much more difficult for companies to classify workers as independent contractors rather than employees.
The decision could eventually require companies like Uber, many of which are based in California, to follow minimum-wage and overtime laws and to pay workers’ compensation and unemployment insurance and payroll taxes, potentially upending their business models.
Industry executives have estimated that classifying drivers and other gig workers as employees tends to cost 20 to 30 percent more than classifying them as contractors. It also brings benefits that can offset these costs, though, like the ability to control schedules and the manner of work.
“It’s a massive thing — definitely a game-changer that will force everyone to take a fresh look at the whole issue,” said Richard Meneghello, a co-chairman of the gig-economy practice group at the management-side law firm Fisher Phillips.
In Texas, the test for independent contractor status is much more favorable to employers, with the standard analysis including things like whether the employer controlled the details of the work, whether there was a set start/stop schedule, how the employee was paid (by the work or by the hour), and whether the employer provided the tools necessary for the job. Most of these factors would tilt against someone claiming employment status with a company like, for example, Uber.
However, the line will be blurry in some cases, and it may take some suits against these companies for nonsubscriber employee claims for personal injury to cause the pattern to change. Already companies like Uber and Lyft provide auto insurance while the employee is on the job. It would not take much for those employers to also provide, for example, workers' compensation insurance to those who desire it. Already this is the case with many owner/operator situations in the commercial trucking industry. They are independent contractors, but often the truckers will have a relationship with the trucking company they contract with for that company to provide workers' compensation insurance as a pass through expense to the "employee"/contractor.
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