3 ms·

>All those "gig economy" companies are going to be forced to treat their employees as employees. I wouldn't make that bet. Here's why. There are 2 paths for

by jasode 11y ago

>All those "gig economy" companies are going to be forced to treat their employees as employees. I wouldn't make that bet. Here's why. There are 2 paths forward for companies like Uber: Option 1: Keep all of their "control" rules such as non-negotiated pricing, etc and then be forced by the government to convert all drivers from contractors to employees. Government to Uber basically boils down to: "hey, you CONTROL the drivers too much so you must pay the price by becoming their employer." Option 2: Tweak some of their control rules so they are closer to the model of eBay's sellers and Apple App Store and iTunes musicians. This avoids the reclassification of drivers to employees. #2 seems to be a much more realistic option. Currently, ebay's sellers are not employees. Also, the programmers submitting iOS apps and musicians that upload music to Apple iTunes are not employees either. There also doesn't seem to be any political pressure or worker's rights advocates pushing for reclassifying them either. #1 does not seem financially possible unless Uber drastically raises the fares to pay minimum wages, extra employee taxes and maintain profit margins to provide returns on the capital invested. Which seems more realistic? Raising fares to become a big employer of drivers like UPS, or relaxing the code of conduct rules for drivers so they are perceived more like eBay/Apple?

tyre 11y ago
The problem is the rules in Option 2 that would enable them to remain classified as a contractor. Specifically, Uber would have to allow drivers to set their own rates. From an end user's perspective, that's a big shift from where we are today. The vast majority of people taking Uber/Lyft never took Lyft when you set your own "tip." There is a reason Lyft switched: users hate "tipping", drivers sometimes get screwed, and it is confusing. Humans aren't known for their rational purchasing decisions. On the other hand, letting drivers set rates now requires users to pay attention whenever they call a car. Rates fluctuate rapidly with wild variation—think how much we love buying airline tickets—so drivers who want to make a living are now in effect playing the stock market. Maybe that's a good thing, to leave it to the market. Maybe it isn't. Either way, it is a large change in the status quo.

by jasode 11y ago

tyre 11y ago

The problem is the rules in Option 2 that would enable them to remain classified as a contractor. Specifically, Uber would have to allow drivers to set their own rates. From an end user's perspective, that's a big shift from where we are today. The vast majority of people taking Uber/Lyft never took Lyft when you set your own "tip." There is a reason Lyft switched: users hate "tipping", drivers sometimes get screwed, and it is confusing. Humans aren't known for their rational purchasing decisions. On the other hand, letting drivers set rates now requires users to pay attention whenever they call a car. Rates fluctuate rapidly with wild variation—think how much we love buying airline tickets—so drivers who want to make a living are now in effect playing the stock market. Maybe that's a good thing, to leave it to the market. Maybe it isn't. Either way, it is a large change in the status quo.