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How the gig economy could support pandemic recovery



Video Transcript

You can think of some gig work as being very personal, like Uber, where you have to get in a car with someone else. And if we come out of this pandemic being a little bit more conservative on interaction, I think it’s going to be less likely that we’re going to be getting into a random stranger’s car. It’s cheaper, but in addition to whatever I have to pay for Uber, there’s an incremental cost that the driver could have COVID-19. And from the driver’s perspective, “I could make X number of dollars by driving, but I also now increase the likelihood that one of my passengers might have COVID-19.”

Food delivery through Amazon or Grubhub, where you can grab stuff and have it be delivered to your place, you could imagine that people might have liked and been exposed to that. Whereas before, they would have had to search and find this app, now it’s become more mainstream.

You could see that that would provide opportunities for some of the displaced labor in the market, because a lot of these Uber drivers that were relying on Uber before now just switched over to doing a lot of these delivery services, helping get food to individuals and reducing the social contact of having to have everybody outside going to pick up food or going to the grocery store.

In that sense, I think that you would see [gig work] as being a mechanism to provide opportunities for individuals that might be between employment. And that was traditionally what the gig economy was. It was kind of a stepping stone for individuals changing careers, maybe going back to school, providing side income. There’s this notion of flexibility, of providing these flexible markets where individuals can partake, rather than being stuck in between full-time employment and trying to find another full-time job.

If the gig economy serves this mechanism—which, we see it in a couple of papers, in terms of the gig economy actually reducing the amount of unemployment that you partake in because it provides that gap period, where you’re actually doing work—you could think of it as also maintaining some human capital.

We don’t have as much human-capital depreciation, whereas before, you would just go on unemployment. The concern is that, as you stay home and not work, you lose scheduling, and you lose a lot of this human capital that you’re used to when you have a full-time job. That starts depreciating. You’re not used to schedules anymore. You’re not used to getting up to go to work. 

And so, it makes it harder to come back into the market. Whereas in this gig, you can maintain some of that by maintaining a schedule. So it guards against human-capital depreciation.

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Insurers may gain from California gig drivers’ new benefits




Ride-hailing and food delivery companies like Uber Technologies Inc., DoorDash Inc. and Lyft Inc. are preparing to roll out benefit packages that include health insurance subsidies for their gig drivers in California, a move that experts say could benefit managed care providers.

The healthcare subsidies are one of the results of California voters approving Proposition 22 in the Nov. 3 general election. The measure allows gig economy companies to continue treating their drivers as independent contractors rather than employees but also requires them to offer certain benefits comparable to those of full-time employees.

Under the provisions of Prop 22, gig employers must provide subsidies consistent with the average employer contributions required under the Affordable Care Act, which would enable contractors to buy healthcare coverage. Beginning in 2021, drivers will receive subsidies each quarter after they submit proof of coverage either via private carriers or through the exchanges.

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“If drivers were to pick an insurance coverage through the exchanges or the individual market, UnitedHealth and Anthem would be well-positioned to absorb this demand because they offer cost-effective access to healthcare services through a large network of physicians, hospitals and outpatient facilities,” Hardy said in an interview.CFRA Research analyst Sel Hardy said the new law could present profitable opportunities for carriers such as Anthem Inc. and UnitedHealth Group Inc.

Piper Sandler analyst Sarah James said Centene Corp. and Molina Healthcare Inc. could also benefit from the new measure.

“Insurance companies are making anywhere from low- to high-single-digit margins on exchange products,” James said in an interview. “Centene is one of the largest exchange providers and they’re also, from a percent of total company earnings perspective, the most exposed to that business.”

The subsidies will be based on drivers’ engaged time with passengers, which is limited to driving to, picking up and transporting customers to their destinations. Time spent waiting between gigs would not count.

Drivers engaged between 15 and 25 hours a week would receive subsidies amounting to approximately $184 per month, while drivers engaged more than 25 hours per week would receive subsidies of about $367 per month.

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The new law also requires network companies to provide on-demand occupational accident insurance to cover medical expenses, up to $1 million, as well as lost income resulting from injuries or illnesses suffered during engaged time. Disability payments and death benefits also must be similar to those provided by workers’ compensation.

However, gig employers do not have to offer other protections such as workers’ compensation and unemployment insurance, nor do they have to provide for family leave or sick leave or allow workers to form labor unions.

The measure overrides California Assembly Bill 5, signed into law in September 2019, which sought to bring labor protections to more gig workers and force companies to classify them as employees.

The industry responded by pushing Prop 22 and spending $200 million to back its passage. The measure was approved by a 58% to 42% margin.

The measure is scheduled to be officially approved by California Secretary of State Alex Padilla on Dec. 12 and go into effect on Dec. 17.

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Labour eyes stronger employment rights for precarious ‘gig economy’ workers




Labour is looking at extending employment rights for workers in the so-called “gig economy” under plans detailed in a new think-tank report.

Precarious workers like Deliveroo riders and Uber drivers would get the same rights as other employees and have their rates set by collective bargaining, under the proposals being examined by Ed Miliband.

While the party’s final policies are yet to be decided, the shadow business secretary said new blueprint drawn up by Common Wealth contains “useful insights” into how workers’ rights could be extended.

Many workers currently miss out on basic employment rights because firms have successfully argued in court that they are in fact self-employed – a loophole that leaves them without holiday pay and even minimum hourly wages.

“There is nothing innate in the concept of the platform that means that work organised through it should be precarious, badly paid, or lacking in control,” the Common Wealth report argues.

Pinpointing “a weakness of regulation and the wider power imbalances” in the labour market, the think-tank recommends closing the loopholes exploited by tech companies to run down pay and conditions for workers on their platforms.

It says this could be done by creating a new “worker” legal status covering all jobs, whether agency workers, bogus “self-employed” or employees. There would be a “statutory presumption that all individuals qualify as employees unless the employer can demonstrate that they are genuinely self-employed”.

This would ensure all workers enjoyed rights such as statutory redundancy pay, sick pay, maternity, paternity, and adoption leave and holiday pay – which many do not currently get.

Zero hours contracts would also be scrapped and replaced with flexible contract that guaranteed employees a minimum number of hours, based on the existing German model.

Responding to the report, Mr Miliband, who sits on the board of the think-tank, said: “Digital innovation and developing technologies offer big opportunities for society, but we must ensure that companies do not wield excessive and anti-competitive power, so that technology works for the public good.

“This report provides useful insights into key ideas and concepts, including looking at how workers rights could be enshrined in light of the changing use of data; and how a National Investment Bank could help catalyse private investment in projects focused on the public good.”

The report also suggests that digital platforms like Deliveroo and Uber should be regulated like public utilities if they achieve monopoly status. It also

Mathew Lawrence, report co-author and Director of Common Wealth said: “There is nothing fixed or inevitable about how the digital economy operates.

“Though the monopoly power of the platform giants is producing a series of stark economic and social challenges, we can reimagine their power and recode how they operate. That should start with a new deal for all workers.”

He added: “But we should go further. A new architecture of multi-stakeholder ownership and control, giving suppliers and users of the platform genuine voice and control, can better unlock the democratic and enlivening potential of platform technology for all.”  

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This New Fort Worth Tech Firm Is Bringing the Gig Economy to the Energy Industry » Dallas Innovates




A new technology firm has launched out of Fort Worth that uses first-of-its-kind technology to connect mineral managers and royalty owners to energy professionals across the U.S. for project-based work. 

Fittingly named, the company essentially offers freelance jobs to those in the energy industry through a tech-enabled marketplace. The platform, which Energy Freelance says is the only one of its kind, has two-fold benefits for both sides of the energy industry.

Mineral managers and mineral and royalty owners are given access to a network of experts, and can create projects and hire qualified workers in a matter of minutes. On the other end, landmen and energy professionals are able to find consistent contract work during a period of market change amidst COVID-19.

Projects posted range from title research and due diligence to GIS mapping and data validation.

[Photo: Energy Freelance]

According to Energy Freelance, the tech is filling an urgent need in the industry. Millions of landmen, title attorneys, and others now have a dedicated place to complete projects they traditionally wouldn’t have an opportunity to.

They’re also able to be their own bosses. The benefits of using the platform, according to the Energy Freelance team, are: access to personalized job recommendations, more money earned by working directly with a client, and working from wherever and whenever.

At the same time, the millions of mineral and royalty owners are assured experienced, qualified workers have been hired to handle their energy needs.

In a time when the gig economy is booming, Energy Freelance’s entirely online marketplace wants to open a previously unavailable segment of the market.

“Uber has proven that there is a strong market for the ‘on-demand service’ and ‘be your own boss’ model,” Energy Freelance CEO and Co-Founder Ryan Vinson said in a statement. “We are taking that same concept and applying it to a vast and growing energy marketplace.”

Vinson, a serial entrepreneur, and the team that brought MineralWare and Energy Domain to market are the ones behind Energy Freelance.

Fort Worth-based MineralWare is a provider of cutting-edge mineral management software for banks, institutions, investment funds, foundations, family offices and individuals. In November 2019, MineralWare launched sister company Energy Domain, an oil and gas minerals royalties marketplace, the industry’s first end-to-end transaction platform of its kind.

Energy Freelance is also a MineralWare company.

“The industry and our clients at MineralWare have continued to ask for easier access to trustworthy industry professionals and competitive rates for project-based work,” Vinson said. “Through an efficient tech-enabled platform, Energy Freelance does just that and more.”

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