3 ms·

The underlying question is "Does skirting employment law by using only 1099'ers make a profitable business solution?" In this case, the answer is no. But the g

by kefka 11y ago

The underlying question is "Does skirting employment law by using only 1099'ers make a profitable business solution?" In this case, the answer is no. But the general answer to that question is "Yes, it is very profitable to upend employment law for the profit of the few, on the backs of the many."

prostoalex 11y ago
After a certain growth period it might be more cost-effective for a company to convert certain contractors to W-2 employees. Company can now mandate hours and keep a highly-rated worker from switching to a competitor. Homejoy never passed that "certain growth period", though. So it's not a clear-cut "contractors = good, employees = bad" thing. It's just that companies exploring these markets are all at early stage of their growth.
- kefka 11y ago
  Why would it be? I'm seeing a lot of reasons to bust "employment". Here's some. 1. Unemployment insurance? Well, you aren't employed. 2. Get hurt on the job? You're not on a job, 1099'er. 3. You "get" to pay the employer's tax as well as your own. Jokes on you, bub. 4. Want to join a union? They kill your account. 5. Real contracts can agree upon wages. How do you do this via Uber/Homejoy/"sharing job"? You don't. 6. Pregnant or sick? FMLA protects employees; not you.
  - SilasX 11y ago
    All of those points apply equally well to any self-employed person. Should self-employment be abolished too? To the extent that there's a problem, it's in the fact that the law doesn't treat the self-employed/other-employed spectrum sanely, such that employer incentives don't align with social goals. We should fix that, not demonize business that optimize for the current broken system.
    - kefka 11y ago
      False equivalence. Consultants have been around for a long time. And they command a high rate, because they are pros. No, they aren't an employee, nor would either side want them to be. They do the job, paid well, and part company. Most consultants get paid somewhere between $150-$400/hr . I know of one who's compensation is $500/hr. This new thing, the "sharing economy" is a way to shove out employees from their protected status and government-fought for rights into the plan that mainly the professionals occupied. Instead, the companies that uses these tools figured out the masses can be convinced that these roles are better, somehow. These people are evident by the fact that they "work" for one company, have standards in which they must follow, and are paid around the low-middle wage for their services (8-12$/hr). Big differences: 1. Wage disparity 2. Knowledge 3. Lawyer or legal team 4. Difference of liabilities 5. "Works for" but not really Tl;Dr. This is an intentional misclassification to skirt employment law.
      - SilasX 11y ago
        My point is, you have to make that distinction more rigorous than "they make less money"; your original points applied just the same to consultants (and legit "independent contractors") as it did to Uber drivers. It seems your real objection and distinction is "but they make less money than my ideal model of an independent contractor". (I don't know what "knowledge" or "lawyer" or "difference of liabilities" means in terms of an articulable, rigorous distinction.) >This is an intentional misclassification to skirt employment law. That's specifically what I was addressing with: >>the law doesn't treat the self-employed/other-employed spectrum sanely, such that employer incentives don't align with social goals. We should fix that, not demonize business that optimize for the current broken system.
        kefka 11y ago
        Money is the biggest sign of a disparity. But it's not the only sign. Another sign is "does each side know what they are agreeing to?" In medical industry, that concept is called informed consent. A party who is accustomed to making $150-$500/hr can afford a lawyer to understand the legal and fiduciary risk. Someone making 'Uber Salary' most certainly cannot. Next, contracts that are discussed and hammered out usually have discussions of liabilities. "What happens if I don't do X?"; "What happens if Y happens?". Instead, Uber et. al. either do not discuss it, or sweep it under the rug, only for the end worker to be bit by it when/if it happens. For example, accepting UBER means you should have commercial driving license by the state. You should also have insurance that covers that. And there may also be other license or tickets you need to be in compliance. UBER knows many of these laws, and they do not inform the workers of these liabilities. It is not a far stretch to see that UBER is in cahoots to subvert law and be an accessory to insurance fraud >the law doesn't treat the self-employed/other-employed spectrum sanely, such that employer incentives don't align with social goals. We should fix that, not demonize business that optimize for the current broken system. We already have a tool for businesses to use: hire them. Good 'ol W2 employment. They're choosing not to, and abuse a system traditionally meant for specialized temporary labor. And what are we to expect when one side has such power ($50 billion banked) vs someone who needs a job? One side is being abused.
  - prostoalex 11y ago
    With exception of workers comp, the FMLA and SDI are negligible, as in they shouldn't exceed single percentages off a paycheck. In reality with W-2 such great charitable benevolent behavior on the employer's part is due to lower rate they typically pay an employee (vs a higher rate organizations would pay a contractor with a similar role) - it's understood that employee is trading off per-hour take-home pay and time flexibility in favor of paycheck stability. We also have a precedent of wage negotiation for a part-time job in a service industry - an employer advertises a job opening at a given rate, interested parties are welcome to apply, disinterested parties are welcome to move along. (It would have to be a part-time 30-hour-a-week-max job to avoid the ACA penalty). It has worked for retail, restaurant, manufacturing, logistics and some other industries, why would it be a show-stopper and game-changer for home cleaning industry? It's not even a drastic change, where 100% of the workforce has to be entirely 1099 contractors or W-2 employees. As long as both options are provided and conversion at later stage is a possibility, it keeps everybody placated.
zeveb 11y ago
> But the general answer to that question is "Yes, it is very profitable to upend employment law for the profit of the few, on the backs of the many." Demand is not constant, but adjusts in response to price. Would a low-income worker rather be a zero-income worker, because no-one is willing to have him work for the wages your regulations demand?
- kefka 11y ago
  All jobs have lulls and busy times. But what this comes down to is that employment law costs money. How much? Between $7000-$10000 per employee. It's a no-brainer to cut out employment law and make the choice between "work crappy consultant job or don't work at all", that is, if you can sustain it. Homejoy couldn't, because of gross mismanagement and eventual reclassification by the IRS. The ultimate goal is to remove all human labor from the market. UBER already came out with that statement: they want to automate their fleet as soon as possible. It's also the trend of every company to reduce labor, increase automated work, lower wages, and increase profits. Damned be the employees/consultants/1099's/hoi polloi. Why am I against "Sharing economy"? I'm not. What I'm against is "What are we going to do with 50% unemployment?" Republicans can't even contemplate science, and are busy bickering about climate change. Democrats have only a basic view of 'workers good, companies bad', except when they are being funded. But still, the question remains is "How do we transition to an economy that can handle massive unemployment with a great deal of goods and profit being made?" (Source: https://www.sba.gov/sites/default/files/The%20Impact%20of%20Regulatory%20Costs%20on%20Small%20Firms%20%28Full%29.pdf https://www.sba.gov/sites/default/files/The%20Impact%20of%20... PDF page 13, paper page 7)

by kefka 11y ago

prostoalex 11y ago

After a certain growth period it might be more cost-effective for a company to convert certain contractors to W-2 employees. Company can now mandate hours and keep a highly-rated worker from switching to a competitor. Homejoy never passed that "certain growth period", though. So it's not a clear-cut "contractors = good, employees = bad" thing. It's just that companies exploring these markets are all at early stage of their growth.

kefka 11y ago
Why would it be? I'm seeing a lot of reasons to bust "employment". Here's some. 1. Unemployment insurance? Well, you aren't employed. 2. Get hurt on the job? You're not on a job, 1099'er. 3. You "get" to pay the employer's tax as well as your own. Jokes on you, bub. 4. Want to join a union? They kill your account. 5. Real contracts can agree upon wages. How do you do this via Uber/Homejoy/"sharing job"? You don't. 6. Pregnant or sick? FMLA protects employees; not you.
- SilasX 11y ago
  All of those points apply equally well to any self-employed person. Should self-employment be abolished too? To the extent that there's a problem, it's in the fact that the law doesn't treat the self-employed/other-employed spectrum sanely, such that employer incentives don't align with social goals. We should fix that, not demonize business that optimize for the current broken system.
  - kefka 11y ago
    False equivalence. Consultants have been around for a long time. And they command a high rate, because they are pros. No, they aren't an employee, nor would either side want them to be. They do the job, paid well, and part company. Most consultants get paid somewhere between $150-$400/hr . I know of one who's compensation is $500/hr. This new thing, the "sharing economy" is a way to shove out employees from their protected status and government-fought for rights into the plan that mainly the professionals occupied. Instead, the companies that uses these tools figured out the masses can be convinced that these roles are better, somehow. These people are evident by the fact that they "work" for one company, have standards in which they must follow, and are paid around the low-middle wage for their services (8-12$/hr). Big differences: 1. Wage disparity 2. Knowledge 3. Lawyer or legal team 4. Difference of liabilities 5. "Works for" but not really Tl;Dr. This is an intentional misclassification to skirt employment law.
    - SilasX 11y ago
      My point is, you have to make that distinction more rigorous than "they make less money"; your original points applied just the same to consultants (and legit "independent contractors") as it did to Uber drivers. It seems your real objection and distinction is "but they make less money than my ideal model of an independent contractor". (I don't know what "knowledge" or "lawyer" or "difference of liabilities" means in terms of an articulable, rigorous distinction.) >This is an intentional misclassification to skirt employment law. That's specifically what I was addressing with: >>the law doesn't treat the self-employed/other-employed spectrum sanely, such that employer incentives don't align with social goals. We should fix that, not demonize business that optimize for the current broken system.
      - kefka 11y ago
        Money is the biggest sign of a disparity. But it's not the only sign. Another sign is "does each side know what they are agreeing to?" In medical industry, that concept is called informed consent. A party who is accustomed to making $150-$500/hr can afford a lawyer to understand the legal and fiduciary risk. Someone making 'Uber Salary' most certainly cannot. Next, contracts that are discussed and hammered out usually have discussions of liabilities. "What happens if I don't do X?"; "What happens if Y happens?". Instead, Uber et. al. either do not discuss it, or sweep it under the rug, only for the end worker to be bit by it when/if it happens. For example, accepting UBER means you should have commercial driving license by the state. You should also have insurance that covers that. And there may also be other license or tickets you need to be in compliance. UBER knows many of these laws, and they do not inform the workers of these liabilities. It is not a far stretch to see that UBER is in cahoots to subvert law and be an accessory to insurance fraud >the law doesn't treat the self-employed/other-employed spectrum sanely, such that employer incentives don't align with social goals. We should fix that, not demonize business that optimize for the current broken system. We already have a tool for businesses to use: hire them. Good 'ol W2 employment. They're choosing not to, and abuse a system traditionally meant for specialized temporary labor. And what are we to expect when one side has such power ($50 billion banked) vs someone who needs a job? One side is being abused.
- prostoalex 11y ago
  With exception of workers comp, the FMLA and SDI are negligible, as in they shouldn't exceed single percentages off a paycheck. In reality with W-2 such great charitable benevolent behavior on the employer's part is due to lower rate they typically pay an employee (vs a higher rate organizations would pay a contractor with a similar role) - it's understood that employee is trading off per-hour take-home pay and time flexibility in favor of paycheck stability. We also have a precedent of wage negotiation for a part-time job in a service industry - an employer advertises a job opening at a given rate, interested parties are welcome to apply, disinterested parties are welcome to move along. (It would have to be a part-time 30-hour-a-week-max job to avoid the ACA penalty). It has worked for retail, restaurant, manufacturing, logistics and some other industries, why would it be a show-stopper and game-changer for home cleaning industry? It's not even a drastic change, where 100% of the workforce has to be entirely 1099 contractors or W-2 employees. As long as both options are provided and conversion at later stage is a possibility, it keeps everybody placated.

zeveb 11y ago

> But the general answer to that question is "Yes, it is very profitable to upend employment law for the profit of the few, on the backs of the many." Demand is not constant, but adjusts in response to price. Would a low-income worker rather be a zero-income worker, because no-one is willing to have him work for the wages your regulations demand?

kefka 11y ago
All jobs have lulls and busy times. But what this comes down to is that employment law costs money. How much? Between $7000-$10000 per employee. It's a no-brainer to cut out employment law and make the choice between "work crappy consultant job or don't work at all", that is, if you can sustain it. Homejoy couldn't, because of gross mismanagement and eventual reclassification by the IRS. The ultimate goal is to remove all human labor from the market. UBER already came out with that statement: they want to automate their fleet as soon as possible. It's also the trend of every company to reduce labor, increase automated work, lower wages, and increase profits. Damned be the employees/consultants/1099's/hoi polloi. Why am I against "Sharing economy"? I'm not. What I'm against is "What are we going to do with 50% unemployment?" Republicans can't even contemplate science, and are busy bickering about climate change. Democrats have only a basic view of 'workers good, companies bad', except when they are being funded. But still, the question remains is "How do we transition to an economy that can handle massive unemployment with a great deal of goods and profit being made?" (Source: https://www.sba.gov/sites/default/files/The%20Impact%20of%20Regulatory%20Costs%20on%20Small%20Firms%20%28Full%29.pdf https://www.sba.gov/sites/default/files/The%20Impact%20of%20... PDF page 13, paper page 7)