The Gig Economy Is Being Sued to Death

This is a very touchy area. Firms can pay $20 an hour for cleaning services precisely because they're not paying for sick days, health insurance and the like. If they have to pay all that, then the wages go down. This is one of many reasons why a large company will pay a company like Accenture two or three times the salary compensation of it's own employees. (There are other reasons too, like having someone to blame when things go wrong.)

In my mind, as long as everyone has open eyes up front, it's all good. If Uber treats people poorly, they can go to Lyft. The key is insuring more competition for the workers. That more than anything else will drive how they get treated. If there are 100 cleaning jobs, and only 90 workers, and multiple vendors, then Handy can't mistreat the workers.

On a side note, I've used Handy in the past, and have had mixed experiences. Some are great, some show up so late that I've had to cancel appointments. Not sure if this would have changed if they were employees.

Right, that's all context around this situation. Obviously companies want whatever they can get.

But it's actually less grim than it seems:

1. there are laws,

2. the price pressures exist for the coordinating companies as well, as long as there continues to be competition, and

3. 'real' autonomy has a lot of benefits for people who are into that.

So first, there are already laws for this. (Which may or may not be sufficient regulation, but they cover a certain amount of what's discussed in the article, hence the lawsuit). Existing laws already stipulate what is/isn't a private contractor, for instance.

Ie, for work like programming, usually one can't be mandated to work in a specific office, or on specific hours, unless there's something about the job that particularly demands it. (Not that this sort of thing comes up a lot in programming, but there are definitely laws around this).

And in fact it's much easier for companies like Uber and Handy to be targeted for misclassification of workers than the more informal economies of construction workers, etc. So if there are holes in the law and they get plugged, that could be cool.

Secondly, "taking a heftier cut than it should from the business transaction" isn't a very damning indictment. But if Uber faces real competition with Lyft, for instance, the cut they can take is dictated by the market, both for drivers and passengers!

Lastly, it's not just workers taking on risk. Workers also gain freedom.

That sounds comical to some.

But I know a lot of people who are very passionate about volunteer work, and absolutely love jobs that they can do for a few hours a week and forget about -- even if it means they're living very simply. (I'm one of those people myself).

Why doesn't the "market" sort this problem out.

Essentially these companies "own" connecting supply and demand, but I fail to see how that prevents competition from forming and providing a better alternative for both?

Right now, as a demand user of Uber, I like that the company is very protective of my experience, something that is painstakingly difficult with traditional taxi services. But if Lyft offered me the same experience or better, my switching cost is nil.

Even upon rereading OP it is not clear it was referring to Federal Law, there is even mention of both State and Federal Departments of labor, so I think use of the word rule was an all encompassing term for classification law. Still it only adds to the problems with this area of the law, after all it is not only possible, but common, for an individual to be classified as an employee/independent contractor on the federal level and then classified the opposite at the state level.

Nevertheless, while the federal classification 20 factors have been around for about 30 years, since the enactment of the Revenue Act the IRS has been prohibited from issuing regulations and rulings with respect to the employment status of any individuals. As a result the IRS acknowledges the same subjectivity going so far as to admit different IRS agents may reach different conclusions, the Courts are no different and hence my calling factors tests the worst kind of law.

>As far as I understand the rules, the "most heavily weighted factor" you cite is in fact not an IRS employee classification factor at all. A contractor can still be classified as an employee...

This is likely due to the IRS being prohibited from issuing rules and regulations, and as a result in the words of the IRS, "Previously issued guidance may not reflect current case law, statutory changes, or changes in workplace situations." However, you are correct that this factor, under FL case law, though weighted more heavily is not determinative by any means.