The last thing the government can allow is employers and employees the freedom to decide the nature of their business and contractual arrangements. From Karen Harned at realclearwire.com:
The gig economy has become a crucial part of our nation’s economic infrastructure. Beyond platforms like Uber and Lyft, independent contract workers are also vital to many other sectors of our economy, from healthcare to the arts. In fact, gig work provides at least part-time income to one in three American workers, totaling $1.2 trillion to the U.S. economy in annual earnings.
But a new rule just issued by the Biden Administration will essentially ban independent contractor status for gig workers under the Fair Labor Standards Act. It will threaten a crucial source of livelihood for millions by putting these jobs at risk. For example, a recent study projected that this sort of policy would result in more than 73,000 lost app-based jobs in Massachusetts alone.
In the wake of successful wage negotiations by the United Auto Workers and other unions, the Biden Administration thinks these workers would be better off if they are converted to full-time employees who are eligible for union membership and traditional employee benefits. But that would destroy the flexibility and independence these workers value most.
A far better solution would be to allow companies to extend benefits to gig workers without making them employees and taking away their autonomy.
Workers in the gig economy have the freedom to set their own schedules and decide when and where they work. This flexibility is not just a perk; it’s a fundamental factor that contributes to high job satisfaction in this field. The Bureau of Labor Statistics found that 79% of independent workers prefer their current arrangements over traditional employment, which can take away their flexibility.
