Pandemic Erodes Gig Economy Work

From today’s New York Times:

It was just after 11 a.m. last Wednesday when Jaime Maldonado, 51, pulled his rented Nissan into a lot outside San Francisco International Airport. He figured he had a long wait ahead — about two hours — before Lyft would ping him to pick up a passenger.

Occasionally, jets roared overhead — but not many, which meant not enough passengers for Mr. Maldonado, who said that before the coronavirus outbreak, he spent just 20 to 40 minutes waiting outside the airport for customers. To kill time, he got out of his car, looping the mask he recently started wearing around his wrist, and went to talk to other drivers.

As the minutes ticked by, Mr. Maldonado wondered out loud, “What am I going to do to pump gas and feed my kids tomorrow?” His number of rides in a typical week had dropped to around 50 from 100 earlier in the month, he said, and his payout had plunged by half to about $600 a week, from which Lyft would subtract the rental fee for his car.

The coronavirus pandemic is exposing the fragile situations of gig economy workers — the Uber and Lyft drivers, food-delivery couriers and TaskRabbit furniture builders who are behind the convenience-as-a-service apps that are now part of everyday life. Classified as freelancers and not full-time employees, these workers have few protections like guaranteed wages, sick pay and health care, which are benefits that are critical in a crisis.

While gig economy companies like Uber and DoorDash have promoted themselves as providing flexible work that can be lifelines to workers during economic downturns, interviews with 20 ride-hailing drivers and food delivery couriers in Europe and the United States over the past week showed that the services have been anything but that.

Instead, as the fallout from the coronavirus spreads, gig workers’ earnings have plummeted and many have become disgruntled about their lack of health care. Many others are also feeling economic pain from the outbreak — layoffs have hit workers in retailing, airlines, hotels, restaurants and gyms — but even as public health agencies have recommended social isolation to insulate people from the virus, gig workers must continue interacting with others to pay their bills.

Read the complete article here.

In major ruling, San Diego judge says Instacart will flunk AB 5 contractor test

From today’s San Diego Union-Tribune:

A San Diego Superior Court judge has ruled that Instacart is likely misclassifying some of its workers as contractors — when the law requires they be classified as employees — marking a notable step toward enforcement of the controversial new state law known as AB 5.

But the ruling came with a healthy dose of skepticism from the judge over the “wisdom” of the law itself.

Judge Timothy Taylor issued an injunction Feb. 18 against Instacart in San Diego Superior Court, essentially warning the San Francisco company that it’s failing to comply with the state’s labor laws. Instacart disagrees with the ruling, and plans to file an appeal, the company said in a statement Tuesday.

Instacart, which operates nationally and has a presence in San Diego, is an app that allows customers to place grocery orders online, which are then purchased and delivered by gig workers called “shoppers.” The labor law case, filed by San Diego City Attorney Mara Elliott in September, takes issue with how the grocery delivery company classifies its shoppers.

The suit alleges that Instacart shoppers do not qualify as independent contractors under a 2018 California Supreme Court decision (Dynamex Operations West, Inc. v. Superior Court). It’s the Dynamex case that spurred Assembly Bill 5 to move its way through the state legislature last year, sponsored by Assemblywoman Lorena Gonzalez (D-San Diego), and signed into law by Gov. Gavin Newsom. The law went into effect Jan. 1.

According to Judge Taylor, the law makes it clear that Instacart is in violation, calling California state policy “unapologetically pro-employee.”

“While there is room for debate on the wisdom of this policy, and while other states have chosen another course, it is noteworthy that all three branches of California have now spoken on this issue,” Taylor wrote in a court filing dated Feb. 18. “The Supreme Court announced Dynamex two years ago. The decision gave rise to a long debate in the legal press and in the Legislature. The Legislature passed AB 5 last fall. The Governor signed it. To put it in the vernacular, the handwriting is on the wall.”

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Kickstarter Employees Vote to Unionize in a Big Step for Tech Workers

From today’s New York Times:

Employees at the crowdfunding platform Kickstarter voted on Tuesday to unionize, the first well-known technology company to take the step toward being represented by organized labor.

The decision, which was formalized by a vote count at the National Labor Relations Board, came down to a narrow margin, with 46 employees voting in favor of the move and 37 opposing it. The debate over a union — and whether such representation was appropriate for highly paid tech workers — had been a source of tension at the company for many months.

“I’m overjoyed by this result,” said Dannel Jurado, a Kickstarter senior software engineer who voted for a union. “There’s a long road ahead of us, but it’s a first step to the sustainable future in tech that I and so many others want to see.”

The pro-union vote is significant for the technology industry, where workers have become increasingly activist in recent years over issues as varied as sexual harassment and climate change. Behemoth companies such as Google and Amazon have struggled to get a handle on their employees, who have staged walkouts and demanded that their companies not work with government entities and others.

But large-scale unionization efforts have faltered. Only a group of contractors at a Google office in Pittsburgh unionized last year, and a small group of Instacart workers managed to do so this month. In the past, most unionization drives have been associated with blue-collar workers and lower-paid white-collar workers rather than white-collar tech workers, who are often paid upward of $150,000 a year.

Veena Dubal, an associate professor of employment law at the University of California, Hastings College of Law, called the Kickstarter vote “a hugely important step” that “signals to workers across the tech industry that it is both desirable and possible to build collective structures to influence wages, working conditions and even business decisions.”

Read the complete article here.

Philadelphia in works to set up agency to protect worker rights in the city

From today’s Philadelphia Inquirer:

The Philadelphia City Council unanimously approved a bill Thursday that would all but ensure the creation of a permanent city agency dedicated to enforcing the numerous progressive labor laws it has passed in recent years.

The bill — introduced by Councilmembers Helen Gym and Bobby Henon in partnership with the Kenney administration — would pose this question to voters in the April primary: Should the city create a permanent Department of Labor that would enforce city labor laws and function as a front door for all worker-related issues?

The question has to be put to voters because it requires a city charter change. Right now, the Mayor’s Office of Labor, created under the Kenney administration, provides these services, but advocates fear a future mayor with different priorities could scrap the office all together.

This effort is part of a broader push by advocates and organizers for stronger labor law enforcement in a city that’s passed some of the most progressive pro-worker legislation in the country but has historically failed to both educate workers about these laws and enforce them.

That started to change in the last year, as advocates who pushed for these laws set their sights on enforcement. Advocates won a modest increase in funding for the Mayor’s Office of Labor, which grew its budget to nearly $1.1 million this year and doubled its staff to six. The number of complaints filed by workers to the office quadrupled from 2018 to 2019 to nearly 100.

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NLRB Says McDonald’s Not Responsible For Franchise Treatment of Workers

From NPR News Online:

McDonald’s should not be held responsible for the labor practices of its franchisees, the National Labor Relations Board ruled on Thursday.

The federal agency, in charge of enforcing U.S. labor law, delivered the latest ruling in a years-long union case that sought to hold the fast food chain liable for the treatment of all workers at both corporate and franchise locations. The agency, also known as NLRB, directed a federal administrative law judge to approve a settlement that had earlier been reached between McDonald’s, its franchisees and the workers who had alleged labor-law violations.

The case was closely watched because it had potential implications for a vast array of companies that rely on franchising and contracting for work, such as janitorial services, trucking, construction and warehousing. The NLRB ruling is expected to face an appeal.

The long and bitter litigation began in 2015, when the Service Employees International Union accused McDonald’s and its franchisees of retaliating against hundreds of workers who supported the Fight For $15 labor movement. For example, workers alleged that they were assigned harder tasks or fewer hours after they attended union-backed protests demanding higher wages.

The government’s labor-law prosecutor at the time asked the judge, Lauren Esposito, to review the complaints and consider McDonald’s a “joint employer” of franchisees accused of violating labor laws.

But under a new administration, the NLRB lawyer last year abruptly proposed a settlement with the affected workers — days before the conclusion of the three-year trial. Esposito rejected the proposal, calling it “manifestly unreasonable” and “simply baffling.”

On Thursday, an NRLB panel overruled the judge and instructed her to approve the settlement deal.

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For 53 million Americans stuck in low-wage jobs, the road out is hard

From today’s Los Angeles Times:

Unemployment is hovering near a five-decade low, workforce participation is at the highest level in six years and Federal Reserve Chairman Jerome H. Powell recently called the labor market “strong.”

Yet, 44% of Americans age 18 to 64 are low-wage workers with few prospects for improving their lot, according to a Brookings Institution report.

An estimated 53 million Americans are earning low wages, according to the study. That number is more than twice the number of people in the 10 most populous U.S. cities combined, the report notes. The median wage for those workers is $10.22 an hour and their annual pay is $17,950.

Although many are benefiting from high demand for labor, the data indicated that not all new jobs are good, high-paying positions. The definition of “low-wage” differs from place to place. The authors define low-wage workers as those who earn less than two-thirds of the median wage for full-time workers, adjusted for the regional cost of living. For instance, a worker would be considered low wage in Beckley, W.Va., with earnings of $12.54 an hour or less, but in San Jose, Calif., the low wage bar rises to $20.02 an hour.

“We have the largest and longest expansion and job growth in modern history,” Marcela Escobari, coauthor of the report, said in a phone interview. That expansion “is showing up in very different ways to half of the worker population that finds itself unable to move.”

Read the complete article here.

Experts warn GM strike not likely to be resolved anytime soon

From NBC News Online:

On this General Motors and the United Auto Workers agree — the strike that sent 50,000 workers out on the picket lines Monday is not likely to be over anytime soon.

Both sides are talking, but both sides are bracing for a long and costly fight as workers dig in on their fight for better wages, health care benefits and job security, union representatives and auto industry experts said.

“It will go on as long as it’s going to take to achieve our bargaining goals,” Chuck Browning, the UAW’s Region 1A Director, told MSNBC. “The bottom line is this company has been extremely profitable for a long period of time. Those profits have been made off the sweat and the hard work of our members, and our members want a fair agreement.”

Erik Gordon, a business professor at the University of Michigan and an auto industry maven, said the leadership of the UAW needs to take a stand against GM not just for the rank and file — but for its own survival.

UAW President Gary Jones and other top union officials are currently under investigation by federal authorities for allegedly embezzling member dues and blowing thousands of dollars on everything from fancy vacations and golf equipment to $400 bottles of Louis Roederer Cristal Champagne.

“I think the union leadership wanted a strike because they’re under attack, and when you feel like you could be losing your grip on power the age-old tactic is to go to war,” Gordon said.

And because they need to be seen as taking a hard line against GM management, union negotiators won’t seek a swift solution even though rank-and-file workers will start feeling the financial pain almost immediately.

Read the complete article here.

Opinion: You Call It the Gig Economy, but California Calls It “Feudalism”

From today’s New York Times:

Labor leaders cheered in the balcony and lawmakers embraced on the floor of the California Senate on Tuesday as it passed a landmark measure that defines employees, a move that could increase wages and benefits for hundreds of thousands of struggling workers.

Image result for uber

But the bill is as much a starting point as an endgame: It will drive a national debate over how to reshape labor laws fashioned in the industrial era of the 1930s to fit a 21st-century service and knowledge economy.

With the measure, which Gov. Gavin Newsom says he will sign, California will lead in a shift that will likely redefine the roles of governments, unions and worker organizations. Just as federal labor laws were promulgated to help the country recover from the Depression, the imperative to extend basic guarantees like a minimum wage stems from the staggering income inequality in California, the state with the highest poverty rate in the country.

The new paradigms will need to fit not the relatively stable industrial work force of the last century but a gig economy in which workers are increasingly likely to hold multiple jobs or report to no workplace at all. California lawmakers took a major step in constructing the foundation of such a model with the new measure, which presumes workers are employees, entitled to all concomitant protections and benefits, unless they meet strict criteria as truly independent contractors.

Read the complete article here.

Uber drivers are contractors, not employees, U.S. labor agency says

From today’s Reuters News Service:

Drivers for ride-hailing company Uber Technologies Inc are independent contractors and not employees, the general counsel of a U.S. labor agency has concluded, in an advisory memo that is likely to carry significant weight in a pending case against the company and could prevent drivers from joining a union.

The recommendation by the office of general counsel Peter Robb, who was appointed to the National Labor Relations Board by President Donald Trump, was made in a memo dated April 16 and released on Tuesday.

The general counsel said in the memo that Uber drivers set their hours, own their cars and are free to work for the company’s competitors, so they cannot be considered employees under federal labor law.

A ruling on the case is to be made by an NLRB regional director. Advisory memos from the general counsel’s office are generally upheld in rulings. Any decision could be appealed to the NLRB’s five-member board, which is also led by Trump appointees but is independent of the general counsel.

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Labor Department moves to ease franchise liability for wage violations

From today’s Reuters News:

The U.S. Department of Labor on Monday issued a proposal that would make it more difficult to prove companies are liable for the wage law violations of their contractors or franchisees, a top priority for business groups.

If adopted, the rule would likely help fast-food companies and other franchisors who have been sued by workers in recent years for wage-law violations by franchisees.

The department in 2017 had already repudiated legal guidance issued by the Obama administration that had expanded the circumstances in which a company could be considered a so-called joint employer under the federal Fair Labor Standards Act (FLSA).

Labor Secretary Alexander Acosta in a statement said Monday’s proposal would reduce litigation under the FLSA and provide clarity to businesses and courts. The FLSA mandates that workers be paid the minimum wage and overtime, among other requirements.

Publication of the rule kicked off a 60-day public comment period.

Under the proposal, companies would be considered joint employers only if they hire, fire, and supervise employees, set their pay, and maintain employment records. That would likely exclude many franchisors and companies that hire contract labor.

Read the complete article here.