Independent contractor or employee?

By: Emily Makings
12:00 am
September 1, 2015

I wrote yesterday about the NLRB’s changing definition of who is an employer. Related to that: Who is an employee? In many cases, the changing nature of work has led to situations where the traditional employer-employee relationship no longer applies.

One such case is Uber. Uber considers the drivers who provide rides through its app to be independent contractors. In June, the California Labor Commission ruled that a particular Uber driver in California is actually an employee of Uber. (Megan McArdle writes about the implications, if the ruling is followed more widely: “But for the drivers, investors and customers of Uber, this ’employee’ label looks like a bad fit and a losing proposition all around.”)

And today a judge granted class action status to Uber drivers in a suit about whether they are employees or independent contractors.

But even if the courts determine that these drivers are not employees, there’s another potential way to fit them into a more traditional employment box. Seattle City Councilmember Mike O’Brien plans to introduce legislation that would

grant all for-hire drivers in the city the right to collectively bargain with the companies they contract with to provide services, which they currently can’t do under federal law, setting up an entirely new system. . . .

Here’s how the new system , which will be formally introduced in the Council next week, would work: Drivers would vote on a non-profit organization to serve as their “exclusive driver representative,” which would then negotiate a contract with the company. If the two parties fail to come to an agreement, they have to submit to arbitration. The resulting contract would be enforced through the courts, rather than the National Labor Relations Board, which unions have found to be slow and sometimes ineffective in deterring employers from violating contract terms.

Crosscut notes, “In addition to an uncertain fate in court, it’s unclear how O’Brien’s legislation would relate to other companies that use contractors — take the Port of Seattle, for example, which employs contract truckers.” Indeed, it seems likely that if this legislation makes it through the Council and the court system, it would be used to organize all types of independent contractors.

Categories: Categories , Employment Policy.