Martindale Center- Policy Briefs on the Future of Work

Protecting Workers’ Rights in the Gig Economy: Digital Labor Platforms and the Case for a Dependent Contractor Classification 6 Executive Summary It happens millions of times a day—the innocuous launching of an everyday application, and the commonplace phrase, “I’ll just order an Uber.” Behind this action, however, lies far more implications for labor than most consumers of the service will probably ever consider. A growing portion of the world is becoming more and more accustomed to this form of exchange of services on demand via digital intermediaries. These digital platforms, powered by the labor of millions of workers in addition to their digital interface, have been increasingly labelled as the “gig,” “on-demand,” or “sharing” economy. This nascent economic model seeks to provide an ecosystem in which workers can have the flexibility traditionally associated with self-employment with far less managerial oversight compared to traditional work via digital communication. Despite these lofty ambitions for the model, the gig economy walks a thin, and wavering, line where its backbone—the millions of its laborers—belongs. While the debate around whether gig economy workers should be considered as employees or as independent contractors rages on in legislatures across the United States, the debate misses the reality that gig workers do not neatly fit into either box. As much as the gig economy has modernized the way consumers demand labor, so too should the systems that regulate this labor evolve. Rather than putting gig workers into either of Policy Brief on the Future of Work MARTINDALE CENTER these classifications, it becomes clear that a new category of worker needs to emerge to fill the gap created by the gig economy: the dependent contractor. Issues and Challenges Broadly speaking, the gig economy consists of freelance workers who are hired for a clear-cut task, work on demand, and often are recruited over digital labor platforms (Torpey & Hogan). Gig economy workers have been traditionally categorized as independent contractors who have control of the location, time, and product of their work. Workers within the gig economy are not tied down to long-term contracts and consequently are not entitled to many of the same benefits as full-time workers. Due to this lack of benefits, an increased amount of liability is placed upon these workers. The gig economy has seen tremendous growth over the past decade and is no longer a small niche of economic activity for workers. As of 2019, there were an estimated 57 million individuals in the United States working in the gig economy (Duffin, 8). Gig economy workers often perform multiple jobs or projects; as of 2018, 56% of gig workers in the United States held two or more jobs (Duffin, 12). A breakdown of gig workers included 25% full-time freelancers, 44% part-time freelancers, and 28% who freelance in addition to a full-time job to earn additional income (Duffin, 9). As Todolí-Signes argues, the gig economy has brought about a new way of doing business and has also brought to light two important issues. The first is the meaning of what exactly an “employee” is and whether gig workers fit into this classification. The secondreflectsontheneedof protection for The changing nature of work creates new opportunities for workers, but also new types of vulnerabilities. – Katherine Stone These Martindale Center Policy Briefs on the Future of Work were prepared by teams of students and young professionals serving as Research Externs with the Lehigh University / United Nations Partnership working in affiliation with the International Labour Organization. Authors: Skyler Brown • Marley Francis • Nadin Hnida • William Peracchio • Valeria Rosales • Kevin Simons • Anthony Trujillo Series Editor: Stephen Cutcliffe, Ph.D. February 2021 Protecting Workers’ Rights in the Gig Economy: Digital Labor Platforms and the Case for a Dependent Contractor Classification