Honeymoon Over For On-Demand Apps, Contract Workers

CREATING A NEW CLASS OF WORKER But even Tesaro admits that what works for him won't work for others, especially not for workers who make a majority of their income from gig work.

That's why, in December, Cornell's Harris co-wrote a proposal with Princeton economist Alan Krueger that advocates for creating a new legal class of worker called the "independent worker."

The classification would apply to all gig workers, not just those working for tech companies, and give them a limited selection of benefits, including collective bargaining rights.

Also, as suggested by Harris and Krueger, companies would be required to provide tax withholding services to independent workers, and contribute 5 percent of workers' earnings to support health insurance subsidies. In addition, companies could pool independent workers to offer better deals on health insurance and retirement accounts.

Harris admits that his independent worker proposal is, at least for now, far-fetched.

"We're not yet in a political situation ... to adopt the solution we put forward," he said. "Both sides have to lose some. Right now, both sides think they're going to win. They don't feel a need to compromise."

As it stands, however, gig economy workers are at risk of being deprived of their fair share of the American workforce social compact, Harris said. The social compact, a product of the Industrial Age when the workforce transitioned from artisan workers to wage workers, is recognized in labor law such that if you give over your labor and time, you get certain benefits that provide a level of economic security, he said.

"(The social compact) offers a modicum of protection from bad things happening in the workplace," he said. "The (benefits) are quite limited. They are not a comprehensive package of guaranteed middle-class lifestyle benefits. But you only get them if you meet the definition of an employee."

A MOVE TO UNIONIZE Collective bargaining rights, in particular, could prove essential to gig workers when it comes to negotiating better wages.

A contingent of local drivers interpreted Uber's fare change in January as an unfair and unnecessary pay cut, but they couldn't do anything, save for protest. Staged a few days after the cuts, the protest was attended by drivers who've grown increasingly cynical about Uber's concern for their well-being. Their frustration that Uber is amassing a fortune while exploiting the people who do the work is amplified by their pinched paychecks or longer hours.

"What Uber has been doing in city after city, unilaterally imposing terms on workers, (taking) an if-they-don't-like-it, they-can-leave (approach); that attitude is a race to the bottom," said Mike O'Brien, a Seattle City Council member who co-sponsored a first-of-its-kind bill in his city.

The bill, adopted by Seattle in December, allows independently contracted drivers to unionize, whereas current federal labor law only grants the right to employees. But the bill could face legal challenges from Uber, Lyft and the U.S. Chamber of Commerce.

"As long as there are people who are desperate enough, that's enough," O'Brien said.

Now, Brown, the local driver with the Uber car lease, is banding with the same disenfranchised San Diego group that staged the driver protest.

Organized by Uber driver Kevin McGraham, 39, the local group wants to create a driver association with enough influence to sway city and state officials, who they hope will advocate for them in the same way Seattle's O'Brien rallied on behalf of that city's independent drivers.

Already, McGraham has made inroads with local officials, including Ralph Dimarucut, senior council representative for Marti Emerald, who chairs San Diego's public safety and livable neighborhoods committee.

Dimarucut said the committee is actively looking at what it can do to support drivers. He plans to talk with the San Diego Metropolitan Transit System, the San Diego Police Department and the Public Utilities Commission, which regulates companies such as Uber and Lyft, to get a better grasp on the situation.

TAKING LEGAL ACTION City-based policies, however, will do little to address national issues.

"There has to be some sort of adjustment in the law to account for this new breed of worker," said Dan Eaton, a business ethics lecturer at San Diego State University and an employment lawyer. "The gig economy is still only a small percentage of the American workforce ... but it's better to put a legislative response in place as (the gig economy is) emerging, then to wait until you reach critical mass."

The legislative response will vary based on the outcome of lawsuits that allege technology companies are illegally classifying workers as independent contractors.

The most prominent case, O'Connor v. Uber Technologies, is a class-action case that appears to be headed for a jury trial in June. Plaintiffs' attorney Shannon Liss-Riordan believes Uber's drivers are entitled to employee wage protections, and should be reimbursed for expenses, such as gas and vehicle maintenance. The lawsuit also challenges Uber's practice of not allowing drivers to accept tips.

Uber, however, doesn't accept that its drivers are employees. For every Laurence Brown, there are at least nine Bill Tesaros who are thriving because of, and not in spite of, the terms of gig economy work, the company would seemingly argue.

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