The state of Washington could be on its way to adopting a law with big implications for the gig economy. State lawmakers have passed a bill that offers ride-hailing drivers some new benefits. The bill bars them from being classified as employees.
Washington is the latest state to grapple with providing rideshare driver benefits – like sick leave and minimum pay — while still giving drivers flexibility over their schedules. Lawmakers there sought some input from organized labor.
“I feel good about it. It’s a good deal,” said Peter Kuel, president of the Washington-based Drivers Union, a group run by the Teamsters Local 117. Kuel, a former rideshare driver, wants benefits and security for gig workers. He also wants them to remain independent contractors.
“I love it to be that independent,” he said.
There have been moves in other parts of the country – most notably in California – to make companies like Lyft and Uber classify workers as employees instead of independent contractors. In California, the gig companies spent millions to help pass a ballot measure that, like the Washington bill, gives drivers some benefits without employee status.
Laura Padin with the National Employment Law Project said the Washington bill could set a dangerous precedent.
“This industry isn’t special. And it shouldn’t be treated as if it’s entitled to this special carve-out from labor and employment rights,” she said.
While the bill provides some benefits, they fall short of those afforded to employees under federal law.
Benjamin Sachs at Harvard Law School said under that law, employees can still have control over their hours. “There is nothing inconsistent between being an employee and having a flexible work arrangement,” he said, adding that remote workers often set their own schedules and are still considered employees.
The pandemic and its disruptions to traditional work arrangements have called into question our system for providing benefits, said NYU business professor Arun Sundararajan.
“Today, more and more people are not employees or don’t fit the definition well. But the benefits are tied to that status,” he said, adding that the Washington bill could be a model for providing benefits to workers who aren’t traditional employees.