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Prop 22 should influence states to provide benefits to gig-workers

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  • Californians across the political spectrum voted to pass Proposition 22, affirming the importance of flexible work and the need to include new benefits and protections for gig-workers.
  • It is time to push forward, focused on better, permanent, collaborative solutions for millions of workers across the country.
  • Tony Xu is the co-founder and CEO of DoorDash.
  • This is an opinion column. The thoughts expressed are those of the author.
  • Visit Business Insider’s homepage for more stories.

2020 has been a year of enormous upheaval. So many of the decisions we faced have been incredibly consequential, shaping the kind of future we want for this country. In one of those decisions, voters in California chose to embrace a new future for work in a decision that has taken on even greater importance in light of our nation’s present challenges.

By passing Proposition 22 with 58% of the vote, Californians affirmed the importance of flexible work and, crucially, the need to update that framework to include new benefits and protections. They rejected an approach that could have eliminated a critical source of supplemental income for millions of Californians, and instead ushered in a modern-day approach that meets the needs of today’s workforce.

This is a signal to the rest of America that change is vital and now is the time for innovative solutions across the country.

Flexible work is crucial to the future of the US economy

Flexible work opportunities with low barriers to entry are more crucial than ever, enabling people—particularly in communities that have been disproportionately impacted by the pandemic—to earn money literally at the touch of a button as unemployment rates skyrocketed throughout the crisis.

 As the CEO of DoorDash, I saw this first-hand: since the first stay-at-home orders went into effect in mid-March, 1.7 million new Dashers joined the platform and together with existing Dashers earned nearly $3.5 billion during the first six and a half months of the pandemic. Importantly, $2.1 billion of that total was earned by Dashers who live in zip codes with above average Black and/or Latinx representation, delivering meaningful income to communities throughout the US.

I believe we need to build upon what began in California to find innovative solutions elsewhere. And that’s why we’re taking the lead and partnering with workers, policymakers, and a variety of stakeholders to build a framework for today’s workforce. 

It’s a vision that reflects what Dashers have told us works best for them—not the workforce of 75 years ago.

Unlike other gig platforms where people may work more hours, 91% of Dashers work fewer than 10 hours per week, with an average of four or fewer hours. More than 4 out of 5 Dashers say that gig work is not their main source of income, and more than 3 out of 4 Dashers say they have another job or are in school. It’s clear: Dashing, and work like it, is filling a critical need for supplemental income in our country, whenever and wherever convenient for the worker.

Instead of getting caught in the no-win dichotomy of employment versus independent contracting, we need a third way that recognizes that this new approach to working is here to stay. That’s because workers want it and it provides the legal protections and benefits they deserve —it’s as simple as that. 76% of Dashers indicate that Dashing has had a positive impact on their ability to provide for themselves and their family. We need a portable, proportional, and flexible framework that is easy to access and allows app-based workers to maintain their independence, while also providing new benefits.

  • Portable: Benefits should be connected to the individual so workers can move from platform to platform, taking their benefits with them without interruption or loss of funding.
  • Proportional: Benefits such as accident coverage and on-the-job injuries should be able to scale up in proportion to the engagement a worker has with a company. And protections against discrimination and harrassment should exist for every worker in America—full stop.
  • Flexible: Allow workers to choose the benefits they want or need, accounting for the different ways people work with app-based platforms like DoorDash.

Prop 22 is one example that works for California, but each state is different, and this is a nationwide issue that requires a thoughtful and tailored approach. We are committed to working with lawmakers and other stakeholders across the country and across the political spectrum to develop solutions that reflect the multiplicity of needs of workers in the 21st century economy.

Now is the time to push forward, focused on better, permanent, collaborative solutions for millions of workers across the country, and DoorDash is committed to leading that effort.

Tony Xu is the CEO of DoorDash.

This is an opinion column. The thoughts expressed are those of the author(s).

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Workers

5 Gig Economy Tips That Will Help You Succeed

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The gig economy has been expanding at a scorching pace, with some surveys indicating that nearly one in three American workers now participate in it, whether part-time or full-time.

A Harvard Business Review study showed that participants in the gig economy do well because they avoid the distractions, pressures, and monotonous routines associated with the traditional workplace.

Here are a five tips that can help you thrive in the gig economy.

Master time management

As a freelancer operating in the gig economy, you are not bound by the fixed timings of a physical office. While this is an excellent advantage, you will not be able to maximize your opportunity if you are not managing your time efficiently.

Download a task manager app on your phone, utilize the calendar app on your laptop, and set up daily reminders for your video meets and phone calls.

Smart time management techniques will help you enjoy the work-life balance you always wanted without diluting your income.

Cultivate your brand

If you are offering your skills or services as a gig worker, the most important product you are selling is you. Focus on building a personal brand that will set you apart from the competition. Clients will find it easy to recall you each time they have a project to outsource.

Get a professional brand name and logo done online, update your LinkedIn and Facebook profiles (if you have a Facebook account), and build a solid digital portfolio to present your skills.

Request client testimonials from past clients, and showcase them effectively.

Create passive income

When you are operating alone as a gig worker, you only have 24 hours in a day. You can only complete a limited number of client projects at a given time. But that does not mean that your income has to be limited. You can find ways to earn additional money without excessively stretching out your time.

Consider getting a roommate if you have a spare room, or become an Airbnb host. If you are working from home, you may even rent out your car using the Turo app. These gigs can create a stable passive income stream.

Control your finances

When you work as an independent contractor, an online entrepreneur or a freelancer, managing your money will require some careful planning.

Unlike permanent employees working for a company, the gig economy does not provide you access to 401(k) or some other employer sponsored retirement plans and health insurance.

It is vital to focus on securing your own financial future when you are a gig worker. Consider automating your bill payments, participate in a systematic investment plan (SIP), and get adequate health and life insurance coverage. Talk to a certified financial planner if necessary.

Keep skills sharp

In a full-time job, complacency can often set in and learning becomes static. As a gig worker, you have the freedom and flexibility to constantly update your knowledge and skills and stay on top of your niche.

Take some free or paid online courses and training that can help you deliver more value to your clients. Learning will also widen your horizons and propel you to do bigger things.

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Entrepreneurs-by-chance who set up a thriving marketplace for gig workers – Business Standard

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View: Gig workers are employees. Start treating them that way

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One of the nation’s largest grocery chains, Albertsons, announced this month that it would replace many of its staff delivery drivers with independent contractors working for the delivery service DoorDash. Those contractors will not receive important labor protections that have been provided to the full-time employees they will be replacing.

For years, companies and legislators have debated whether so-called gig workers like those who drive cars for Uber or deliver groceries for DoorDash should be entitled to benefits like minimum wage and unemployment insurance. But in the wake of a California ballot proposition passed in November and a rule just released by the Trump administration, it appears that the erosion of labor protections is advancing aggressively.

When the gig economy sprang up during the Obama years, it seemed novel. Companies like Uber used software to offer assignments to people on call who set their own hours. One major caveat: As independent contractors, these workers wouldn’t get traditional wage protections, workers’ compensation, health insurance or unemployment benefits. But that didn’t stop the quick expansion of the gig economy.

In 2019, California legislators sought to improve life for gig-company workers, passing a law that required companies to treat app-deployed workers as employees. In response, the companies spent $200 million promoting Proposition 22, a state ballot initiative that affirmed gig companies’ classification of their workers as contractors while enshrining limited protections.

This hybrid labor category came from an unexpected source. In 2015, Seth Harris and Alan Krueger, labor economists from the Obama administration, argued against giving gig workers employment status. Instead, they proposed a compromise: App-deployed workers could receive some rights, like tax withholding and a right to organize, but not others, such as a minimum wage and unemployment insurance.

But researchers like us who have documented the exploitive conditions of gig work worried that this approach would hurt a much larger group of service workers — just as the Albertsons decision will.

App workers need the same benefits afforded to traditional workers, including payment for time between assignments, unemployment benefits and the right to organize. The pandemic, which greatly worsened conditions for delivery workers and “shoppers” (the people assembling grocery orders), has exposed just how vital basic protections are for vulnerable workers.

In ongoing research with colleagues at Northeastern University, one of us, Dr. Schor, analyzed a delivery platform that converted its California workers to employees before the passage of the 2019 law. Both top and middle management said they felt positively about the switch, citing improved performances and increased productivity that partly offset the costs of employment protections.

In ethnographic research on Uber and Lyft ride-hail drivers, Dr. Dubal found that, contrary to the companies’ promises of freedom and flexibility, longtime drivers feel trapped in grueling work schedules and controlled by their algorithmic bosses. Notably, these findings undermine Uber and Lyft’s arguments against employment status.

In a bad omen for workers outside California, Dara Khosrowshahi, the chief executive of Uber, has vowed to support efforts similar to Proposition 22 elsewhere. Lyft, a competitor, is behind political action committees that will support candidates who will protect its business model. Shawn Carolan, a venture capitalist whose firm has invested in Uber, has written that the Proposition 22 model should be extended to other industries, such as education, health care and computer programming — which would increase the number of Americans who toil without a safety net or predictable earnings.

In some sense, gig-economy companies have been moving in parallel with Washington. The Trump Labor Department this month released a rule, set to go into effect in March, that will make it easier for companies to designate their workers as independent contractors.

But the incoming Biden administration can undo the rule. And working with Congress, it can move to dignify app-deployed work by calling it what it is: employment.

The Biden administration can end the state-by-state, sector-by-sector battle over basic workers’ rights. It can clarify that exemptions from employment and labor laws violate the Fair Labor Standards Act, therefore invalidating Proposition 22.

Marty Walsh, Joe Biden’s nominee for labor secretary, can also move to revoke a Trump administration letter from 2019 that classifies gig workers as contractors. Perhaps most important, the Biden administration could work on winning passage of the Protecting the Right to Organize Act, which would untie the hands of workers who seek to organize their workplaces.

As inequality reaches record highs, the hybrid-worker category threatens the future of all service workers. With the building of progressive momentum to address racial and economic inequality, the Biden administration should expand protections for all workers, not allow them to erode for millions more.



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