Uber Workers Are Employees and They Should Be Categorized That Way

I completely agree with Benjamin Sachs that the idea of a third category of employment to cover Uber and gig workers is a terrible idea that would carve out a substandard regulatory framework. Employers would explode this loophole if it existed.

During the last few years of the Obama Presidency, we saw a productive debate over the question of whether changes in the organization of work called for a new legal categorization of workers. In particular, the question was whether we need a third category, intermediate between “employee” and “independent contractor,” to capture the kinds of work arrangements typified by gig economy firms like Uber. Seth Harris and Alan Krueger, in a leading example, called for the creation of a legal category they named “independent worker,” which would grant some – but not all – protections of employment law to workers engaged in these types of work relationships.

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The Obama administration, with the Perez/Weil team in charge at the Department of Labor, presented a relatively favorable political context for trying out a third category of worker. Had that administration embraced such a development, it would have worked to ensure – perhaps through veto of any problematic legislation, perhaps through administrative action – a legal category with the best chance of leveling up conditions for workers. Even in that favorable political context, there was robust debate about what the results of a third category would have been. There was genuine disagreement among policymakers and commentators, all committed to improving conditions for those working in the new labor market, over whether a third category made good sense.

But whatever the results might have been in positive political circumstances, it ought to be quite clear what the results would be in the political context that will begin on January 20th: implementing a third legal category of work would almost certainly be disastrous for workers. Should the incoming Congress, or the Puzder Department of Labor, be charged with creating the third category, we could safely predict that it would be constructed in a way that allows employers to shift employees down into the less-protective intermediate classification, and not to enable independent contractors to shift up into the more protective middle ground.

Accordingly, for those interested in protecting the interests of workers, a third category should now constitute a third rail. Instead, our energies should be focused in another direction: on ensuring that as many workers as possible – across the gig economy and in similar work arrangements – get classified as employees, which, in my opinion, is where they’ve belonged all along. The legal definition of “employee,” as complicated as it might sometimes become, is broad and fully adaptable to the new systems of work organization. It allows, for example, charity canvassers – who set their own schedules, are permitted to hold multiple jobs, and who are never directly supervised by anyone – to be classified as employees. In numerous cases, in fact, courts have found an employment relationship despite the fact that the workers controlled the hours they worked, were unsupervised, and enjoyed all the associated indicia of “flexibility.”

The entire idea of “flexibility” is a construct designed to exploit workers. It must be beaten back, not embraced. We should be concerned that the Trump administration will seek to create this through the Department of Labor. Fighting this possibility should be a top priority for all concerned with worker rights.