5 ms·

Really interesting article. One important newsworthy note from this article that I think has been missed in some of the broader coverage: Washio, Postmates, and

Really interesting article. One important newsworthy note from this article that I think has been missed in some of the broader coverage: Washio, Postmates, and Shyp have been sued by their contractors/employees, joining the same club as Uber, Lyft, and Homejoy. This is an industry-wide issue, not isolated to just a handful of companies, and has the potential to severely damage this budding industry, as the author notes. Whenever I take an Uber or Lyft these days, I always ask what the drivers think about the issue, and the uniform response so far (obviously this is anecdotal and not at all scientific) is that they like the flexibility of being able to choose when to drive. For many, this is their second job they do on weekends, nights, or early mornings. They are worried that they'll lose this flexible source of income that are helping, for example, save for their children's college education or pay their way through night school. I'm not saying that this represents the majority view, or that the legal issue should come out any differently, but I do worry that some of these workers, happily employed as contractors, will lose out on this opportunity.

Chinjut 11y ago
One supposes what they'd really like is to be able to enjoy both flexible hours and typical benefits and worker protections. Unfortunately, we've set up our stupid system so that these are somehow exclusive.
- jacobheller 11y ago
  Yeah, I hear you. I guess one other way these things are exclusive is that they drive up costs for sharing economy companies. Some of these companies are pricing so low that they are barely making a profit as it is. If their costs are even higher, they will have to drive up prices, and at least part of their appeal immediately vanishes. At least a few of the companies will die if that happens.
  - dropit_sphere 11y ago
    > At least a few of the companies will die if that happens. I wish people would realize this is a morally neutral outcome. Like, oh no, another company down the drain. It's not like they're a limited resource. We should be willing to sacrifice a thousand companies if they can't succeed on the profit metric under the rules we've set. "Sharing economy" type companies are a good idea. They'll succeed, or better ones will. They don't need coddling.
    - evanpw 11y ago
      If a company and its potential customers are prevented from making a mutually beneficial exchange because of some rule, that's a cost. You can argue that the cost is outweighed by the benefits of the rule, but you can't just claim that the cost doesn't exist.
      - toomuchtodo 11y ago
        Yes, labor regulations are a cost. Yes, that's because we're civilized people. If you want a libertarian paradise where government doesn't interfere, move to Somalia.
      - deleted 11y ago
        [deleted]
- enraged_camel 11y ago
  The "stupid system" is set up this way for a reason: to prevent employers from majorly fucking over their employees (and avoid taxes) in order to maximize profits. The reason a lot of Uber drivers don't mind being contractors is because they already have full-time jobs that provide health insurance. But ask drivers who drive during regular business hours (they will be more likely to not have any other job) and they will probably tell you that they would rather be employees.
  - AlexandrB 11y ago
    I think there's a stunning irony in the fact that America's privatized health system causes problems for disruptive companies like Uber.
mathattack 11y ago
I agree - many folks like having flexibility. This could be an example of a subset of disgruntled workers and their lawyers killing the Golden Goose. Of course I still believe that the Ubers of the world need to follow labor laws.
- GVIrish 11y ago
  If the Golden Goose is indeed slain, it will also be due to the sharing companies willfully ignoring legal issues to keep pushing growth, Uber being the prime example. Asking for forgiveness, not permission works sometimes but eventually you do have to deal with the legalities.
jusben1369 11y ago
Homejoy is a red herring. They were out hustled by competitors and used this issue to save face/exit. This _is_ a very new form of employment that is a mixture of two older forms. There's way too much momentum to kill it. New legislation will be enacted to cover this 3rd type of worker which will please no one except that it'll remove uncertainty so the businesses will support it.
rm_-rf_slash 11y ago
Perhaps going from independent contractor to proper employee can be an earned upgrade? Those who show consistent performance could become eligible for benefits like health coverage, auto repair co-payments (if Uber, for example), and a preferred listing for customers. This way people who are committed to making a living in the sharing economy can coexist with the real independents who only participate to make a little extra coin.
- prostoalex 11y ago
  A company like Uber doesn't have the economy of scale to get a good rate for benefits. Each state is a different market, so being a top transportation network in California doesn't buy you negotiating power in New Jersey. The rate won't differ much from what the driver will be quoted on an ACA exchange if he were to buy it himself (and might actually be worse, because individuals are eligible for subsidies, while companies aren't). Then you have all sorts of issues of vacation time and coverage meanwhile. If the driver doesn't sign into the network for X amount of days, is he still eligible? Or automatically dropped from employee status and subsequent coverage?
  - rm_-rf_slash 11y ago
    That's a good point. It would certainly require a rethinking of how a company like Uber considers drivers to be employees. Using Uber as an example, they would have to mandate working hours and other customer service standards. However in Uber's particular case, being a $40bn company and not being able to pay employees like employees is either a reflection of laziness, greed, shamefulness, or all of the above.

Chinjut 11y ago

One supposes what they'd really like is to be able to enjoy both flexible hours and typical benefits and worker protections. Unfortunately, we've set up our stupid system so that these are somehow exclusive.

jacobheller 11y ago
Yeah, I hear you. I guess one other way these things are exclusive is that they drive up costs for sharing economy companies. Some of these companies are pricing so low that they are barely making a profit as it is. If their costs are even higher, they will have to drive up prices, and at least part of their appeal immediately vanishes. At least a few of the companies will die if that happens.
- dropit_sphere 11y ago
  > At least a few of the companies will die if that happens. I wish people would realize this is a morally neutral outcome. Like, oh no, another company down the drain. It's not like they're a limited resource. We should be willing to sacrifice a thousand companies if they can't succeed on the profit metric under the rules we've set. "Sharing economy" type companies are a good idea. They'll succeed, or better ones will. They don't need coddling.
  - evanpw 11y ago
    If a company and its potential customers are prevented from making a mutually beneficial exchange because of some rule, that's a cost. You can argue that the cost is outweighed by the benefits of the rule, but you can't just claim that the cost doesn't exist.
    - toomuchtodo 11y ago
      Yes, labor regulations are a cost. Yes, that's because we're civilized people. If you want a libertarian paradise where government doesn't interfere, move to Somalia.
    - deleted 11y ago
      [deleted]
enraged_camel 11y ago
The "stupid system" is set up this way for a reason: to prevent employers from majorly fucking over their employees (and avoid taxes) in order to maximize profits. The reason a lot of Uber drivers don't mind being contractors is because they already have full-time jobs that provide health insurance. But ask drivers who drive during regular business hours (they will be more likely to not have any other job) and they will probably tell you that they would rather be employees.
- AlexandrB 11y ago
  I think there's a stunning irony in the fact that America's privatized health system causes problems for disruptive companies like Uber.

mathattack 11y ago

I agree - many folks like having flexibility. This could be an example of a subset of disgruntled workers and their lawyers killing the Golden Goose. Of course I still believe that the Ubers of the world need to follow labor laws.

GVIrish 11y ago
If the Golden Goose is indeed slain, it will also be due to the sharing companies willfully ignoring legal issues to keep pushing growth, Uber being the prime example. Asking for forgiveness, not permission works sometimes but eventually you do have to deal with the legalities.

jusben1369 11y ago

Homejoy is a red herring. They were out hustled by competitors and used this issue to save face/exit. This _is_ a very new form of employment that is a mixture of two older forms. There's way too much momentum to kill it. New legislation will be enacted to cover this 3rd type of worker which will please no one except that it'll remove uncertainty so the businesses will support it.

rm_-rf_slash 11y ago

Perhaps going from independent contractor to proper employee can be an earned upgrade? Those who show consistent performance could become eligible for benefits like health coverage, auto repair co-payments (if Uber, for example), and a preferred listing for customers. This way people who are committed to making a living in the sharing economy can coexist with the real independents who only participate to make a little extra coin.

prostoalex 11y ago
A company like Uber doesn't have the economy of scale to get a good rate for benefits. Each state is a different market, so being a top transportation network in California doesn't buy you negotiating power in New Jersey. The rate won't differ much from what the driver will be quoted on an ACA exchange if he were to buy it himself (and might actually be worse, because individuals are eligible for subsidies, while companies aren't). Then you have all sorts of issues of vacation time and coverage meanwhile. If the driver doesn't sign into the network for X amount of days, is he still eligible? Or automatically dropped from employee status and subsequent coverage?
- rm_-rf_slash 11y ago
  That's a good point. It would certainly require a rethinking of how a company like Uber considers drivers to be employees. Using Uber as an example, they would have to mandate working hours and other customer service standards. However in Uber's particular case, being a $40bn company and not being able to pay employees like employees is either a reflection of laziness, greed, shamefulness, or all of the above.