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Big labor’s attacks on the gig economy are anti-worker 

FILE – An Uber sign is displayed inside a car in Palatine, Ill., Thursday, Feb. 10, 2022. The U.S. Department of Labor is proposing a new rule on employee classifications, saying workers have incorrectly been deemed independent contractors, which hurts their rights. The department said Tuesday, Oct. 11, that misclassifying workers as independent contractors instead of employees denies employees’ protections under federal labor standards, promotes wage theft, allows certain employers to gain an unfair advantage over businesses, and hurts the economy. (AP Photo/Nam Y. Huh, File)

The early days of the pandemic were a challenging time. But as days turned to weeks and months, that period often brought out the best in people — Zoom calls with old friends, birthday car parades — and routinely inspired the ingenuity of the business community. 

Employers developed creative ways to operate. For instance, some reoriented their business to produce personal protective equipment and other critical materials. Individuals started small businesses, and many found wage-earning opportunities in the emerging gig economy, including by utilizing technologies like app-based transportation or delivery services. 

We almost take for granted now how these technologies served as a lifeline for users on both ends of the transaction. For example, people unable or hesitant to leave their homes could still get groceries delivered through Instacart or patronize their favorite restaurants using DoorDash. And individuals looking for work or supplemental income, or whose lives or schedules were not conducive to a conventional job, could earn good money as an independent contractor connecting with customers through an app-based service, setting their own schedule and often using multiple apps at the same time.   

Even as workplaces reopened, the appeal of app-based work was clear: flexibility and independence were increasingly desirable. The ranks of gig workers continued to expand even as the number of open employment positions increased dramatically. WHYY explored this trend in their December 2021 article “Number of women doing gig work in Philly region surged during COVID-19.” 

Despite the advantages app-based platforms offer to workers, customers, and communities, they are under attack in Pennsylvania and nationally. Why? Because one constituency, organized labor, is not directly benefiting.   

Big labor is pushing policies around the country and in Pennsylvania that would force all app-based workers into a traditional employment arrangement, as opposed to the current independent contractor model that allows for flexibility and the ability to use multiple apps. The Pennsylvania Chamber recently joined hundreds of organizations opposing a big labor-backed federal proposal targeting the gig economy and has led the charge responding to a similar recommendation proposed by a Pennsylvania Department of Labor & Industry Task Force dominated by big labor. 

Is big labor interested in helping independent contractors? It doesn’t seem like it. Labor forces derailed a recent proposal that would have guaranteed unemployment and other benefits to gig workers. Labor’s gripe is that they are seeing the growth of the gig economy but haven’t yet figured out how to get a cut of the action. And if they can’t benefit, no one should. 

The bigger problem for the rest of us is that big labor’s continued attempts to substantially rewrite independent contractor eligibility laws — including in Pennsylvania —would impact individuals far beyond the app-based economy. The trucking industry, for example, has long been an attractive option for independent owner-operator truck drivers who own their truck, prefer to set their own schedule, work with multiple companies, and retain a level of independence not often possible when working as an employee. Forcing an unwanted employment arrangement could push truck drivers out of the industry, further exacerbating a trucker shortage, straining supply chains, and increasing costs to consumers. 

Similarly, freelance writers, photographers, and other creative professionals have historically operated as independent contractors as the best way to combine their entrepreneurial and artistic skills. Big labor’s independent contractor proposal would disrupt the business model these individuals have chosen for their careers. 

Unfortunately, this anti-independent contractor campaign has been erroneously framed as part of a broader effort to address “worker misclassification” —a term used to describe unscrupulous, careless, or mistaken employers who classify workers as independent contractors when, by law, they should be classified as employees. 

All stakeholders — lawmakers, regulators, employers, unions, and others — should join to combat worker misclassification by working with employers to ensure compliance, educate workers, and crack down on bad apple violators in the business community. But they should also partner to protect independent work arrangements that comply with the law and benefit everyone involved. 

The Pennsylvania Chamber stands ready to partner with anyone interested in addressing real worker misclassification. At the same time, we oppose big labor’s attacks on independent contractors and the gig economy and urge lawmakers to reject their misguided campaign.  

Alex Halper is vice president of government affairs at Pennsylvania Chamber of Business and Industry. 

Tags gig economy independent contractors worker misclassification

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