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California’s Prop. 22 could affect the gig economy nationwide

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California’s Proposition 22 is an initiative sponsored by Uber, Lyft, DoorDash and other gig work platforms. It would exempt app-based ride-hailing companies and food delivery companies from a new state law that requires them to classify drivers as employees instead of independent contractors.

Gig companies have poured nearly $200 million into the Yes on Proposition 22 campaign, making it the most expensive ballot initiative in state history. They’ve threatened to leave California or dramatically raise prices if it doesn’t pass, and a loss could embolden other states to insist that app companies hire their drivers.

I spoke with Sam Harnett, a reporter for KQED in San Francisco. The following is an edited transcript of our conversation.

A headshot of Sam Harnett, a reporter for KQED in San Francisco.
Sam Harnett (Photo courtesy of Gundi Vigfusson)

Sam Harnett: Gig companies are saying, “If this doesn’t pass, we’re going to have to potentially suspend service in California.” And if it passes, Uber, Lyft and the rest of the gig companies will be able to continue operating the way that they were operating before. Their workers would be contractors, [which] means they wouldn’t have basic employee protections like unemployment insurance, workers’ compensation. And the way this proposition is written, that will be pretty much locked in. There’s this seven-eighths provision, which means it would take seven-eighths of the Senate and Assembly in California to make any changes to this proposition. And local jurisdictions, cities and counties couldn’t make any changes to give gig workers more benefits.

Molly Wood: Do these same restrictions, this un-overturnability, does that apply even if the companies are forced to classify their workers as employees?

Harnett: Well, if Proposition 22 doesn’t pass, workers will become employees, but these gig companies still have billions of dollars, and they’re going to keep fighting this tooth and claw. I mean, they see this as an existential threat to their business model. So on the one side, if Prop 22 passes, the gig model looks pretty solid. I mean, maybe something federally could lead to a change. Maybe there could be a lawsuit over something procedurally in the proposition, like maybe that seven-eighths provision I mentioned. But it’s going to be there. On the flip side, if Proposition 22 doesn’t pass, you can expect another salvo from the gig companies pretty quickly.

Wood: This is a California ballot proposition, but I wonder what implications could it have if it doesn’t pass for the gig economy nationally?

Harnett: Oh, huge. I think everybody, nationally and internationally, is looking at this case. Over the last couple years, you’ve seen the California Supreme Court, the California legislature and now the attorney general go after these companies and tell them, “Your workers are actually employees, and they need basic protections.” And if the gig companies are successful in using the ballot box to defy the three branches of government and maintain their business model, I think a lot of other states, and a lot of other countries, are going to see that as, “Well, the gig companies, they won.”

Wood: And if they don’t win, would that embolden maybe states and localities who have wanted to do something about this model to pass their own laws?

Harnett: Absolutely. In Massachusetts, they’re moving, pushing back on gig companies in a similar way. And in other states, they’re now trying to follow California’s path. And I think a victory for labor if Prop. 22 doesn’t pass, I think will ripple. And again, the companies would have to then classify workers as employees, and the rubber is going to hit the road, and we’re going to see how that all plays out.

Wood: These companies, of course, have poured a ton of money into this campaign, and they’re using their platform for that campaigning. Can you talk about some of the tactics that they’re using when you’re actually using apps like Postmates and Uber and Lyft these days?

Harnett: They got $185 million behind this, but they also have apps in hundreds of thousands or millions of voters’ pockets. So if you’ve taken Uber or Lyft, you’ve probably gotten a pop-up that has had messaging about Proposition 22. And if you work for these apps, you’re also getting pop-ups and material inside the apps urging you to vote yes on Prop 22. DoorDash has sent several million pro-Prop. 22 delivery bags for restaurants, which then the DoorDash workers have to carry the food to customers in those bags. And then Uber has a pop-up for riders that tells riders that their drivers support Prop. 22 and to talk to drivers about it. So these companies are leveraging their apps and they’re leveraging their workers in a way that has never been seen before in an election fight.

Wood: In your reporting, what are you hearing from drivers? Do you have a sense of how they’re feeling about all this?

Harnett: I’ve been covering this for five or six years, and drivers actually have always told me pretty much the same thing, which is they want to be their own boss, they want to be independent, they want to be flexible, but they also want basic protections, or at least enough money to get those basic protections. So a lot of drivers, they get these surveys that ask them if they want to be contractors, and it’s kind of confusing, because they do want to be contractors, but it’s kind of an aspirational desire to be contractors. They want to be contractors who actually make enough money to pay for health insurance, who actually make enough money to work when they want to work. And right now, what drivers are saying is that the rates haven’t been good in years, but they’ve been declining since the beginning. They’re frustrated. So I’d say workers want autonomy, independence and flexibility, but they want some basic protections.

Rideshare drivers demonstrate against rideshare companies Uber and Lyft during a car caravan protest on August 6, 2020 in Los Angeles.
Rideshare drivers demonstrate against rideshare companies Uber and Lyft during a car caravan protest on Aug. 6 in Los Angeles. (Robyn Beck/AFP via Getty Images)

Related links: More insight from Molly Wood

The Guardian calls Proposition 22 an initiative with “the fate of an industry” riding on it. Even more than that, it’s an attempt to figure out a new framework for labor and hiring in an economy where apps like this do employ so many workers. And in some ways, like Sam Harnett said, a lot of drivers, analysts and labor experts think there should be a third way, something in between very regimented 8 a.m. to 5 p.m. employment that at least comes with benefits, and total freedom and flexibility — to die with no health insurance or miss rent if you get sick.

The delivery and ride-hail companies are positioning Proposition 22 as sort of a third way since the drivers would stay independent contractors but get some small benefits, like accident insurance and stipends to use for health insurance that go up the more hours someone drives. And, of course, it’s hard to forget that this proposition is a total end-run around a state law that the companies in question just decided to ignore. Nevertheless, opinions on Proposition 22 are fairly evenly split, even though many Californians are already voting.

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‘What are the options?’: a new film on the toll of the gig economy | Documentary films

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Jason Edwards would find it a struggle to pass a job interview with his prominent gold teeth and criminal record. But he has something more powerful than a suit, shirt, tie, clean shave and polished shoes. He has a laptop and guile.

Edwards works from home by filling in online surveys. It is not typically lucrative work, paying just a few cents. But Edwards, who is white, figured out that by posing as an African American Republican, his opinions would be much sought after. He reckons he has earned more than $30,000.

“If you didn’t cheat the system the way I do, you’re not going to make a respectable amount of money,” he observes from a modest house in Mims, Florida, where he cares for an ailing mother who loves smoking and lottery scratchcards.

This is just one bittersweet story told in The Gig Is Up, a new documentary that shines a light on the human side of the gig economy, now worth more than $5tn a year globally and spurred further by the coronavirus pandemic. It includes, of course, the now familiar hustle of driving or delivering for companies such as Uber, Amazon and Deliveroo.

But there is also a bigger and more mysterious army of “ghost workers”: millions of people around the world who provide the elusive human factor in artificial intelligence, from completing surveys to transcribing audio recordings or tagging images and other data. While they gain work-from-home flexibility, they earn a pittance, must provide their own computer, broadband and power and have to cope without a safety net, trade union or the consolation of office banter.

“There is a Big Brother aspect to that, where there’s no one to call,” says the director, Shannon Walsh, by phone from Vancouver, Canada. “That was one of the big things we heard around the world, that sense that you were at the peril of a machine. Get a bad rating, if someone’s in a bad mood one day, and you lose your job and your livelihood. It’s a next level of precarity.”

The Gig Is Up is the fifth feature film for Walsh, 45, a Canadian who has had spells living in South Africa and Hong Kong and always had an interest in uncovering stories that are most neglected. She was intrigued by the way gig work offers the illusion of technological utopia on slick phone apps but hides an entire underclass of workers.

“In the early 2000s we used to talk about globalisation and the outsourcing of jobs into parts of the world where you could find cheap labour,” she says. “With the advent of the platform economy, we really see this flattening of the global workforce. The haves and have nots each exist in each country.

“Someone doing a job in rural Florida is actually doing the exact same job as someone in Lagos or someone in Mumbai. I found it fascinating how that shift has happened with the growth of multinational corporations. What we saw in those early days has really transformed into something else.”

A still from The Gig Is Up.
Photograph: Intuitive Pictures

Within the US, Walsh found that gig work throws a lifeline to people shut out of the formal economy for reasons such as disability, caring for an elderly parent or children, or having undocumented immigrant status or a criminal record that would show up on a background check. In some cases, they are desperate.

“It’s not the idea of a student making pizza money: that is what the companies want us to believe. It’s folks who need this kind of work and don’t have a lot of other options in many cases and who are working for multiple platforms to try and scrape together a living.”

A delivery driver knows that a single spilled drink or spoiled meal can result in career-ending complaint from a customer. On the flip side some “independent contractors”, as they are euphemistically known, relish the autonomy and flexibility of not being tied to the 9-to-5 commute, freeing them to attend their child’s school concert or sports game or explore their own creativity

Walsh’s travels for the film included Nigeria, where gig work is both liberating and crushing. Some perform menial online tasks for Amazon’s Mechanical Turk platform, sometimes for just a few cents, and are paid in Amazon gift cards.

One Nigerian interviewee, a trained architect, does 3D design work for architecture firms in the US along with far more soulless work. Walsh says: “You’ve got this paradox where you’ve got folks like him working for Amazon gift cards in one breath and then also having this incredible untapped amount of human creativity and expertise.”

She extrapolates: “This new kind of evolution of platform-based work can’t be painted with one brush. There’s this incredible sense of human creativity connected like we’ve never had before and yet at the same time, it’s a race to the bottom in terms of not taking into account what that means for the transformation of labour and the future of work.

“If we’re going to ask people to be available and ask them to bring their creativity and human intelligence to the table, how does that shape the way we have to think about what we need around labour? In the US, the idea of having a base of support and security that is not reliant on the companies doing that is going to be ground zero in the conversation.”

Filming The Gig Is Up.
Photograph: Intuitive Pictures

Many of the film’s subjects speak wearily about the isolating effects of gig work, especially since the apps are actively designed to prevent workers meeting each other and organising. But Walsh observes: “What’s always amazing is that, like the grass that grows through the cracks in the pavement, people find ways to find each other.

“We heard great stories in India about folks doing platform based work on computers who would find each other on Reddit forums, call each other and just leave the phone off the hook while they worked because that sense of community around work is essential. People will find a way to be in community.”

The process of how society, and notoriously tech-illiterate governments, get to grips with gig work, regulates it and forges a new social contract is only just beginning. Last week elected officials in New York City passed legislation for gig economy and food delivery workers, setting minimum pay, allowing workers to keep more of their tips and limiting how far workers can be asked to travel for deliveries.

But there is a long way to go to curb the power of corporations that have found in gig work a way an army of labour that not even 19th-century coal barons and factory bosses could have dreamed of.

Walsh comments: “The big names are problematic on so many levels. They’re trying to bend the rules for their benefit and governments by and large for a long time have been letting them do that. It’s also that question of policy not quite being where tech is. It’s so often the case that stuff’s already happened by the time governments catch up to understanding what is happening.”

Back in Mims, Florida, Jason Edwards cannot bear to watch The Gig Is Up because his mother died just after it was made. But he still has the gig economy. Walsh reflects: “I really felt a lot for him through the process. What are the options in a place like where he lives?

“And this is true for a lot of the US, unfortunately. What are the work options that are available to you? A lot of them are not good. Like he said when I first interviewed him, ‘Well, before this, I was dealing drugs.’ What else is he going to do?”

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Striketober and the Gig Economy

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What does ‘Striketober’ mean for the gig economy?

Is something stirring among the workers? There are signs of a noticeable uptick in strikes internationally. In the US, where trade unions have been shattered by decades of neoliberalism, an October strike wave, dubbed ‘Striketober’, includes John Deere manufacturers, Hollywood film workers, nurses, building engineers, auto parts workers and Instacart gig workers.

The Instacart strike, organized by the grassroots Gig Workers Collective, took place yesterday [16 October], and followed a campaign for consumers to #DeleteInstacart over collapsing pay, unsafe conditions and the unfair ratings system at the Amazon company.

It’s not only in the US. In the UK, the combination of a labour shortage, rising prices and a supply chain crisis is pushing workers to use their leverage to push for higher wages and better conditions. The climate summit in Glasgow, COP26, will be marked by train strikes, while bus workers are also striking for three weeks demanding higher pay. Lorry drivers in Unite the union are seizing on the shortage of drivers by threatening crippling strike action over the Christmas period unless pay and conditions are improved drastically.

Bigger Slice of the Pie

What about in the EU? There are signs in Germany, with inflation reaching a 29-year high of 4.1% in September, that workers want a bigger slice of the pie. The Financial Times reports that unions are entering negotiations demanding above-inflation wage increases, with lower unemployment an additional factor in giving workers’ more confidence. The number of construction companies stating a lack of workers were limiting their activities hit a new high of 27%.

What does all of this mean for the gig economy? One possible outcome is that platforms will have to offer higher pay and potentially greater employment security to attract and hold on to workers. If they do not, gig workers with little attachment to the platform could look elsewhere, or they could decide that taking strike action is now worth the risk.

Gig workers have been treated by platforms as easily replaceable and thus easily disposable, but what if that were to change? The growth in industrial action we have seen this year in Europe’s gig economy may just be the start of something. •

Ben Wray is Gig Economy Project co-ordinator.

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Festivals boost demand for gig workers as economy opens up: Experts

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Amid the ongoing festival season in the country, the hiring of gig workers has zoomed across sectors as the businesses have begun opening up leading to an uptick in consumer sentiments and rising pent-up demand, according to experts.

“In the third quarter, with the onset of festive season, we are witnessing a 400 per cent spike in the hiring for gig workers. Earlier, in the first quarter of this year, as many businesses and companies were not operating at full strength, growth was muted.

“However, things began picking up and became more promising from the second quarter, as the demand for gig workers across sectors grew,” Taskmo, a subsidiary of Quess Corp, co-founder Prashant Janadri told PTI here.

Given the impact of the pandemic, companies are preferring quick hiring processes, therefore gig workers and short-term workers are in high demand, he added.

He said that currently, the demand for gig workers is being witnessed, especially in sectors including edtech,

, mobility, e-commerce, foodtech and retail across roles.

Roles such as business development, sales, marketing, onboarding, auditing, retail and warehouse operations are mostly in demand, he added.

“As companies are opening up after the COVID-19-induced lockdowns, we are witnessing increased demand in customer support, tele-sales, onboarding partners, auditing, packing, customer service, loader-unloader, samplers and merchandisers roles,” he said adding that demand for blue-collar gig workers is more as compared to the white collar workforce.

The salary for gig workers is 1.25-1.5 times higher as compared to the first and second quarter, Janadri also said.

Echoing a similar view, FirstMeridian Business Services Group CEO Sudhakar Balakrishnan said pent-up demand and rising consumer purchasing, e-commerce is expected to generate up to 1 lakh jobs this festive period.

The Indian job market is on the road to recovery, as most of the companies are intending to hire in this quarter, which is expected to be the highest over a period of 1.5 years, he stated.

“The pandemic has taught companies about adaptability and new ways to navigating through disruptions. There was an increase in the number of delivery boys, people handling distribution centres to meet the demand in the festive season.

“Looking at the current trends, hiring in the e-commerce sector is expected increase 50 per cent, e-pharma and logistics will increase 30-40 per cent and food delivery will increase over 50 per cent,” he noted.

He further said that e-commerce, e-pharma, and logistics are the biggest job creators in the gig blue-collar space right now, and 70 per cent of new hires will be blue-collar, while 30 per cent will be white-collar.

E-commerce is also facilitating indirect employment at seller partner locations, with kirana stores acting as last-mile delivery partners, he said.

“Also, demand for gig workers are robust in sectors such as logistics, warehousing, technology and support services, as companies expand and optimise their supply chains. Retail, healthcare, home services, and fintech are also areas of focus,” he said.

Balakrishnan further stated that the demand for blue-collar workers has increased by 50 per cent in Maharashtra, Telangana, Tamil Nadu and Karnataka, which are more industrialised.

“The majority of the hiring is taking place at Delhi, Mumbai, Hyderabad, Ahmedabad, Kolkata, Pune and Lucknow. Even as India’s gig economy is an unorganised sector where wages are not fixed, we anticipate that the workforce will earn an additional 25 to 30 per cent as a result of the increased workload,” he added.

Meanwhile, CIEL HR Services Director and CEO Aditya Mishra said hiring of gig workers has gone up due to the sales and marketing push by e-commerce players, consumer durables, apparels, footwear, food and beverages, beauty and wellness sectors.

“We see gig workers in a wide variety of roles, the largest being in last-mile delivery. We see rise in gig workers in the domains such as content, digital marketing, supply chain operations, sourcing consumer loan applications, beauticians and technicians for cleaning services, installation of electronic appliances.

“On an overall basis, blue- and grey-collar jobs are the most in number, about 90 per cent,” he said.

Metros, tier-II and -III cities have created these jobs for the festive season because the end customers have been in a buying spree, Mishra said.

“As the scare of COVID-19 has receded, we see an upswing in consumer sentiments and the pent-up demand is finding the release.

“Another important reason is the fact that many people have moved back to their home towns and the spending power is no more concentrated in the metros as they used to be pre-COVID-19 era. As a result, we see a rise of over 50 per cent in demand of gig workers in tier II and III cities,” he observed.

The earnings of gig workers will increase in the season because they will get to perform 40-50 per cent more gigs than what they did on an average month, he added.

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