Biden administration blocks Trump-era rule affecting gig workers’ employment

From today’s Reuters News Service:

The Biden administration on Wednesday blocked a Trump-era rule that would have made it easier to classify gig workers who work for companies like Uber and Lyft as independent contractors instead of employees, signaling a potential policy shift toward greater worker protections.

Shares of companies that employ gig labor such as Uber, Lyft and DoorDash immediately pared gains. At 2.15 p.m. ET (1815 GMT) Uber shares traded down 3.2%, Lyft was down 5.8% and DoorDash fell 5%.

“By withdrawing the independent contractor rule, we will help preserve essential worker rights and stop the erosion of worker protections that would have occurred had the rule gone into effect,” Labor Secretary Marty Walsh said in a statement.

“Too often, workers lose important wage and related protections when employers misclassify them as independent contractors,” he said.

Walsh told Reuters in an interview last week that a lot of U.S. gig workers should be classified as “employees” who deserve work benefits. His comments hurt stocks of companies that employ gig labor.

Walsh said in the interview that his department would have conversations in coming months with companies that employ gig labor to make sure workers have access to consistent wages, sick time, healthcare and “all of the things that an average employee in America can access.”

An Uber spokesman acknowledged on Wednesday the current employment system is outdated.

“It forces a binary choice upon workers: to either be an employee with more benefits but less flexibility, or an independent contractor with more flexibility but limited protections.”

Read the complete article here.

Labor Secretary Says Gig Workers Should Be Converted to Employees

From today’s Forbes Magazine:

President Joe Biden positioned himself as the champion of the American worker during his campaign, as well as an ardent proponent of unions. On Thursday, Biden’s Labor Secretary, Marty Walsh, told Reuters that gig workers should be treated as employees.

This simple statement could become an existential threat to app-based technology companies, such as Uber, Lyft, Instacart, DoorDash and dozens of others that heavily rely upon gig-economy workers.

The tech companies are basically built on the backs of contract workers. However, these gig workers are not classified as employees. Without the designation, contractors don’t qualify for traditional benefits, rights and privileges that are afforded to full-time permanent employees.

This sector represents a significant part of the economy. About 55 million Americans work in the gig economy, comprising around 36% of the workforce. If the Biden administration decides to take action based upon Walsh’s plan, it could have devastating consequences. 

Walsh seeks to rectify the situation by reclassifying contract workers as “employees.” The labor secretary said, “We are looking at it, but in a lot of cases, gig workers should be classified as employees…in some cases they are treated respectfully and in some cases they are not and I think it has to be consistent across the board.” Based upon this news, shares of Uber fell as much as 8%, while Lyft took a dive by 12%. Doordash fell nearly 9% and Grubhub was down 3.3%.

There are concerns raised by opponents of the gig-economy structure who say, similar to Walsh, it doesn’t seem fair to workers. Venture capitalists, institutions and wealthy individuals have flooded capital into this sector. When the tech companies went public, the investors, CEOs and top executives reaped vast fortunes. Contractors serve as cheap labor. If they acquiesce to critics like Walsh, they risk losing multimillions or billions of dollars. 

While many people earn a livelihood driving cars, delivering food and offering creative services through on-demand companies, there is a dark side. The contractors work long, hard hours for little pay and no real benefits. Near-monopolies have been created that crush or drive out the competition. Look at what happened to the once-ubiquitous yellow taxi cabs when Uber came to New York City. 

Uber, Lyft, DoorDash, Grubhub and other similar gig-based companies are highly dependent upon independent contractors. They have a financial self-interest in classifying drivers or workers as contractors. This model enables corporations to avoid paying payroll taxes, FICA (Social Security and Medicare), disability, federal and state-level unemployment and health insurance benefits. They are not required to comply with minimum-wage laws nor offer vacation days. 

Read the complete article here.

Break down employment barriers with training, education programs

From today’s CalMatters Online:

“You can’t have just one job in America,” says a gig worker in Los Angeles County, and “you could get replaced like this. ‘Say one wrong thing to me? You’re fired …There is a line outside the door who wants your job.’”

That is one of several perspectives from struggling workers in California captured in a new report by the Institute for the Future, which interviewed a cross-section of Californians paid less than $15 an hour last fall. The report, released March 24, explores troubling trends that preceded the pandemic but now are worsening. 

And it comes on the heels of another report by the state’s Future of Work Commission that calls for a new social compact for workers based on some staggering statistics. For example, nearly one-third of all  workers in California make less than $15 per hour, and a majority are over age 30. Women and people of color also are paid, disproportionately, the lowest wages in our state.

Beyond wages, fewer than half of workers in California report having a “quality job,” which the Future of Work Commission describes as “a living wage, stable and predictable pay, control over scheduling, access to benefits, a safe and dignified work environment, and opportunities for training and career advancement.”

The commission also notes how a decrease in worker power and organizing relates to job quality, inequality and violations of workers’ rights. The percentage of Californians in a labor union has dropped from 24% in 1980 to 15% in 2018, and membership in a union reduces the likelihood of low-wage employment more so than a college degree (39% versus 33%).

The futurists at the Institute for the Future outline how COVID-19 has accelerated instability and insecurity for workers. This is now an all-hands on deck moment, requiring consensus and collaboration across sectors – government, business, labor, education, workforce development, philanthropy and community organizations. This is difficult, complicated, and even expensive work, but it is essential if we are to make the California Dream real and attainable for all.

Despite collaborative efforts, we need more employers and labor organizations at the table. Industry has a critical role, and they must be closely involved every step of the way, not as an afterthought.     

The good news is that some promising efforts are underway. If passed, Assembly Bill 628, introduced by Assemblymember Eduardo Garcia, a Democrat from Coachella, will build upon the Breaking Barriers to Employment Initiative by assisting individuals in obtaining the skills necessary to prepare for jobs in high-demand industries. The program would support individuals who face systemic barriers to employment with training and education programs aligned with regional labor market needs.

Read the complete article here.

Fintechs Need Strong Consumer Protections, Diversity, Inclusion Asserts Key Congressman

From tdoay’s Forbes Magazine:

Fintechs need to include strong consumer protections, diversity, and inclusion, Rep. Ed Perlmutter (D-CO), chair of the House Financial Services Committee’s panel on consumer protection and financial institutions said at a hearing on banking innovation today.

“Most banks and credit unions have been a source of strength in the pandemic in part because of the stringent capital, liquidity, and other regulatory requirements we place on these financial institutions,” he asserted.

The financial stability risks, consumer protection issues, market fairness questions, and potential benefits of unconventional banking charters needs to be explored, Perlmutter said.

Financial Services Committee Chairman Maxine Waters (D-CA) said she was alarmed the Office of the Comptroller of the Currency (OCC) overstepped its authority by creating a fintech charter and expressed concern it could lead to a regulatory race to the bottom.

The New York State Department of Financial Services has sued the agency, claiming it lacks the legal authority to issue that type of charter. In a memo prepared for the hearing, the Committee’s Democratic staff noted in recent years, OCC, and the Federal Deposit Insurance Corporation (FDIC) have taken steps to allow firms to engage in banking activities while being subject to less regulations and supervision compared to most other banks and credit unions.

At the same time Wyoming, which was mentioned frequently at the hearing, and other states have ventured into unconventional bank charters aimed at allowing cryptocurrency and blockchain to provide bank-like services.

Financial Services Committee lead Republican, Patrick McHenry of North Carolina, said regulators should be advancing advances in banking innovation and not hindering them.

Brian Brooks, who headed up the agency as Acting Comptroller of the Currency during the Trump administration praised the potential of fintechs to expand credit and economic opportunity with additionally providing better alternatives to payday lenders.

Read the complete article here.

“An NDA Was Designed to Keep Me Quiet” – How Pinterest Undermines Equity in the Workplace

From today’s New York Times:

Last March, I sat in a lawyer’s conference room and watched as my corporate account at Pinterest was suddenly shut off. For almost two years, I had worked at the company as a public policy manager engaging with elected officials, civil rights groups and public health organizations. In an instant, I lost access to emails, documents and all internal systems. Months earlier, I filed complaints about wage discrimination and retaliation. Now the company was presenting me with no choice but to leave.

I thought about how I would explain to my colleagues, friends, family and prospective employers why I no longer had the high-profile job I loved. Worse, I had to find a way to have those conversations without violating the terms of a highly restrictive nondisclosure agreement (NDA), drawn up by Pinterest’s legal team, which was designed to keep me quiet.

Companies have long used NDAs to prevent competitors from poaching confidential information and good ideas. But they appear to increasingly be used to prevent workers from speaking out about instances of harassment, discrimination or assault they may face on the job.

During the #MeToo movement, those who came forward to report workplace abuses did so at great personal and legal risk. But it shouldn’t be this way. That is why I’mhelping lead the passage of a bill in California that, if signed into law, will allow victims of any kind of workplace discrimination to speak openly about the abuse they experience, regardless of the language in an NDA.

For a long time, I hesitated to speak about the issues I experienced at Pinterest. I didn’t want to be sued, and I hoped that the company would do the right thing and address the pay inequities and retaliation I faced. But it didn’t. When I eventually made the decision to come forward publicly, I, along with a courageous former colleague named Aerica Shimizu Banks, did so with the knowledge that we’d be covered, to some extent, under a 2019 law in California called CCP 1001.

Passed in the wake of the #MeToo movement, the law provides protections for those breaking NDAs if they disclose factual allegations related to only three types of misconduct: sexual harassment, sexual assault and gender discrimination. But those protections did not include the race discrimination that I also faced as a Black woman. As such, only one part of my identity was protected, leaving me in a sort of legal limbo.

Recognizing the need for intersectional protection in this law, I decided to work withCalifornia State Senator Connie Leyva (the author of CCP 1001) to help draft and sponsor the Silenced No More Act along with the California Employment Lawyers Association and Equal Rights Advocates. If passed, the measure will allow victims of any type of covered workplace discrimination — on the basis of such categories as race, religion, age, disability and sexual orientation — to speak honestly and openly about what they have faced, regardless of the language in a nondisclosure or nondisparagement agreement.

Read the complete article here.

Unionization Efforts by Amazon Workers Dealt a Blow After Alabama Vote

From today’s Los Angeles Times:

Amazon workers at a giant Alabama warehouse have voted against unionizing, a significant blow to a months-long campaign that pitted union activists against one of the nation’s most powerful employers and briefly appeared poised to reenergize the American labor movement.

Workers cast 1,798 votes against joining the Retail, Wholesale and Department Store Union, which led the effort to unionize employees at the facility in Bessemer, Ala., while 738 workers voted to join the union, according to a vote result Friday overseen by the National Labor Relations Board.

Some 5,876 warehouse workers were eligible to cast ballots by mail-in vote starting in February.

The result came after a days-long count that was announced online via livestream, and after nearly a week in which the labor board reviewed and certified, behind closed doors, all cast ballots. There were 505 contested ballots set aside during this process and not included in the final tally. The union said the majority were contested by Amazon. The labor board determined there weren’t enough contested ballots to affect the election result.

It was the closest Amazon workers anywhere in the U.S. had come to a union, unusually in a right-to-work state with enduring Deep South history. In Bessemer, worker concerns over the company’s handling of COVID-19 workplace safety converged with the racial equity movement to set in motion one of the most closely watched American union drives in recent history.

The RWDSU said it intended to challenge the result, which it characterized as the result of intimidation and unfair practices by Amazon during the campaign. Amazon on Friday disputed union messaging that it had unfairly influenced the vote, and thanked the Bessemer workers for participating in the vote.

The chasm reflected the dual reality that many Amazon workers say they navigate: On the one hand, earning higher than minimum wage, with benefits, at one of the world’s most influential companies at a precarious time for the economy and jobs. And on the other hand, enduring the exacting control and pace of work in warehouses that Amazon has come to be known for, to meet the quick delivery goals customers have come to expect — all as consumer demand boomed during the pandemic.

Read the complete article here.

Unions at The Ringer and Gimlet Media announce their first contracts

From today’s New York Times:

Unions representing employees at two prominent podcasting companies owned by Spotify, the audiostreaming giant, announced Wednesday that they had ratified their first labor contracts.

The larger of the two unions, with 65 employees, is at The Ringer, a sports and pop culture website with a podcasting network. The second union, at the podcast production company Gimlet Media, has just under 50 employees. The two groups were among the first in the podcasting industry to unionize, and both are represented by the Writers Guild of America, East.

Lowell Peterson, the guild’s executive director, said the contracts showed that the companies’ writers, producers and editors “bring enormous value to the major platforms for whom they create content.”

The contracts establish minimum base pay of $57,000 for union members at The Ringer and $73,000 at Gimlet Media, annual pay increases of at least 2 percent, and a minimum of 11 weeks of severance pay.

The agreements include provisions that limit the use of contractors and allow workers to receive titles that reflect their seniority.

The two companies will create diversity committees that include managers and union members, and will require that at least half the candidates seriously considered for union positions open to outsiders come from underrepresented groups, such as racial minorities or people with disabilities.

Read the complete article here.

With a Huge Victory, UK Uber Driver Moves on to Next Gig Worker Battlefront

From today’s Inequality.org:

In recent weeks, courts in multiple countries have delivered huge victories for gig workers by establishing the principle that these workers are, in fact, employed by digital platforms and are thus entitled to basic worker rights and protections.

The most stunning win was the UK Supreme Court’s recent scathing judgement against Uber. While lower courts had ruled again and again that UK-based drivers are in fact workers, the company had refused to comply with this classification until this final ruling.

James Farrar, a former Uber driver and a lead plaintiff in the case, is celebrating this huge victory, which means that gig workers will have the right to wage protections, holiday pay, and other basic benefits. But during six years of litigation against Uber, Farrar and his colleagues realized that gig workers would need to fight on additional fronts. Right now, these employees lack access to the data that their app-based employers gather about them.

To take on this critical battlefront for worker rights in the 21st Century, Farrar has founded Worker Info Exchange. I asked Farrar to explain why he started this new nonprofit organization and what it hopes to achieve.

How did you come to realize the need for a data rights strategy?

When we brought the employment case, Uber challenged me with my own data and they came to the tribunal with sheaves of paper that detailed every hour I worked, every job I did, how much I earned, whether I accepted or rejected jobs. And they tried to use all this against me. And I said we cannot survive and cannot sustain worker rights in a gig economy without some way to control our own data.

So I used Europe’s General Data Protection Regulation (GDPR) to try to extract my data from Uber. And it began by asking questions, what data do you have and what can you give me? And I began to understand that Uber was unwilling or unable or both to give it to me. And I needed an entity behind me to get that to happen.

How will access to their data help workers?

Gig workers need access to data to see how they are being managed and paid. Right now companies are using automated decision making. This means allocation of work, performance management, and dismissals are decided based on data that the app gathers and feeds into algorithms. We need to understand the code behind those because sometimes those decisions are unfair. When decisions are unfair we can’t just let company executives say it wasn’t intentional. We need to expose and challenge the logic fed into the algorithm. Very few people are doing this right now.

GDPR is useful because it doesn’t just give you the right to data, it’s access to logic of processing. I have a right to fairness of processing under GDPR. So data rights are more comprehensive than just simple access to raw information. What we have done so far is challenge Uber to disclosure — what data the app collects, things like GPS trace. But what we really want are inference data. What decisions has it made about me? How has it profiled me? How does that affect my earnings? This is what Uber has not given us.

Read the complete article here.

Tesla and Elon Musk Appeal NLRB Ruling about Union Activities

From today’s Detroit Bureau:

Tesla CEO Elon Musk wants his day in court, and the EV maker’s filed a petition to get it, appealing a recent ruling by the U.S. National Labor Relations Board that he’s violated U.S. labor law.

As part of the NLRB’s ruling, Tesla and Musk were required to perform several actions, not the least of which is a mandate that Musk take down a now nearly three-old tweet suggesting that if Tesla employees joined a union they could lose stock compensation.

The electric car maker filed a petition on April 2 with the New Orleans-based U.S. Court of Appeals to review the NLRB’s decision and order issued on March 25.

The NLRB ruling stated that Tesla violated federal labor law when it fired a union supporter and moved to block a union organizing drive at its plant in Fremont, California.

In addition, the NLRB found Tesla and the company’s freewheeling CEO, Elon Musk, violated the law and ordered them to stop interfering with workers seeking to organize a union at the Fremont plant, handing a victory to the United Auto Workers (UAW). The ruling on union activity by employees also extends to any other installation operated by Tesla in the U.S.

The dispute between Tesla and the UAW has been ongoing. The union began an organizing effort at Tesla more than five years ago and filed the unfair labor charges against the company in 2017 after security guards seized union literature and one of the leaders of the UAW effort inside Tesla was dismissed.

Tesla is disputing the NLRB’s ruling and asked the court to review the order and grant Tesla “any further relief which the Court deems just and equitable.” Tesla’s Musk has long disputed that his company is against union organizing.

In a 2018 tweet, Musk wrote: “Nothing stopping Tesla team at our car plant from voting union. Could do so tmrw if they wanted. But why pay union dues & give up stock options for nothing? Our safety record is 2X better than when plant was UAW & everybody already gets healthcare.”

The NLRB ruling ordered Musk to delete that three-year-old tweet warning employees they could lose their stock options if they opted to join the United Auto Workers, which had begun an organizing drive in Fremont. Compensation, including stock options, are subjects of contract negotiations under federal labor law.

The NLRB ordered Tesla to offer one of the former employees reinstatement. The company was also directed to rescind rules established in 2017 that prohibit the distribution of union literature in its parking lot on non-work time.

Read the complete article here.

Silicon Valley’s essential workers form new group to fight for work rights

From today’s San Jose Spotlight:

A group of six essential workers and labor leaders stood in front of McDonnell Hall in San Jose Wednesday—the same church labor activist Cesar Chavez started his now-iconic labor organizing more than 50 years prior.

The workers are looking to craft the future of the labor movement among essential workers for the next 50 years, starting with combating unfair treatment from employers, elected officials and corporations during the COVID-19 pandemic.

They announced Wednesday the launch of a new initiative called the Essential Workers Council, a collective of 14 members from diverse professional fields in the South Bay, including medical workers, security, grocery workers, childcare, construction and education. The council has been established by Silicon Valley Rising, a collective of leaders who advocate for workers’ rights and affordable housing.

“As workers on the front lines of this crisis, we need to be the ones setting the agenda for recovery,” said Deo Agustin, a childcare worker and member of the new council. “We can’t let business leaders decide how things should be run.”

The group, with local labor leaders’ help, hopes to lobby elected leaders for more essential worker protections during and after the pandemic, such as higher wages, more widespread hazard payrent relief, stronger eviction protections and affordable childcare.

“Even as mostly Black and brown people put their lives at risk, dying at disproportionately higher rates, too many corporate executives and elected leaders have ignored their needs and their voices,” said Maria Noel Fernandez, director of Silicon Valley Rising, on Wednesday. “They call this work essential, but not the people, their families and our communities.”

The coronavirus has killed Black and Latino residents in the county at a far higher rate than other races. Latinos in particular make up 25% of the county’s population but account for 51% of cases and nearly 29% of deaths, according to county numbers. Those racial groups are overrepresented in essential work.

The council, frustrated by the lack of clear leadership from their employers to combat COVID-19, such as providing enough personal protective equipment and socially-distanced workspaces, spoke out about their experiences in working while living in fear that they would contract the coronavirus.

Read the complete article here.