Clara Jane Hendrickson | Is driving for Uber a job?

Praxis | Finding New Ways to Offer Labor Protections in the Freelance Economy

By Clara Jane Hendrickson 02/21/16 10:19pm

On Feb. 11, taxi, limo and Uber Black drivers blocked traffic in Center City to protest UberX and Lyft — the cheaper of the ride-sharing services — claiming that unregulated drivers are undercutting other drivers. It seems that no one is winning in the gig economy. As I encountered the protest, I couldn’t help but feel frustrated.

Workers should not be responsible for fixing the steep competition introduced with the onslaught of numerous ride-sharing options. Instead, the ride-sharing startups need to take responsibility for the entirely new categorization of labor they have created.

In December, Seattle City Council passed an ordinance that allows Uber drivers to unionize. The passage of this measure represents the first of its kind in any major United States city. Before Seattle City Council passed the measure, David Plouffe, the senior vice president of policy and strategy for Uber, visited Seattle to criticize the new law.

In an interview with The Seattle Times, Plouffe characterized Uber as helping workers in an economy facing wage stagnation. Plouffe declared, “How people are using the Uber platform now is to augment existing income, to provide a bridge when they may lose their job or get their hours cut.” Uber’s employment practice is premised on the idea that the economy is crummy and that the company assists workers by providing the opportunity to earn some extra cash in the meantime. But in truth, a significant number of Uber drivers are not merely using the app as a convenient way to make a few extra bucks, but instead rely on it as their primary source of income.

Plouffe’s statement essentially excises Uber from its role as an employer. This becomes dangerous given the fact that a third of U.S. workers now identify as freelancers. After accounting for car and driving expenses, most Uber drivers make less than minimum wage in the cities they live in. It’s beginning to become clear that the treatment of Uber drivers as independent contractors is neither fair nor accurate.

However, the prospects of organizing Uber drivers along traditional trade union lines seem dismal. The success of union organizing often depends on the ability of workers to share a need to assert their rights collectively. Uber drivers do not have access to such co-worker camaraderie, as they lack a traditional workplace.

Currently, Uber faces a class action lawsuit challenging the company’s classification of drivers as “independent contractors.” The reclassification of drivers as employees, rather than independent contractors, would make Uber responsible for reimbursing drivers’ expenses and providing benefits to all full-time drivers. A recent calculation determined that the treatment of Uber drivers as employees would cost the company $209 million in California alone.

Many policymakers, however, see an alternative. The classification category of “dependent contractor,” currently used in Germany, Canada and elsewhere — but not the United States — would provide workers with greater labor protections while maintaining the flexibility which characterizes their current status.

The rise of the on-demand, freelance or gig economy has defied traditional models of employment and thus will require untraditional methods of offering labor protections. The model of “dependent contracting” would acknowledge the need to extend protections to those now considered independent contractors. The fact that most full-time Uber drivers today fail to make minimum wage is a disgrace. It is also a disgrace that most of Uber’s 160,000 drivers have to pay for their own health care out-of -pocket.

Rather than imposing an ill-fitting model of employment and labor organizing on the gig economy, a system of dependent contracting would benefit the increasing number of people working as freelancers.

Unfortunately, the lines of responsibility and accountability are not as clear in the rise of the gig economy. However, the absence of a traditional employee-employer relationship does not mean that laborers should be forced to live without the legal protections offered by traditional employment. The Seattle City Council ordinance is a step in the right direction, but may not be particularly useful since the prospect of Uber drivers unionizing seems unpromising.

The heyday of traditional trade-union-style organizing for the stable job is over, but it should not ring in a new economic era where the trade-off between freedom and security is excruciatingly high for so many.

Clara Jane Hendrickson is a College senior from San Francisco studying political science. Her email address is clara@sas.upenn.edu. Follow her on Twitter @clarajanehen. “Praxis" appears every other Monday.

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