A Gig Economy Victory For Companies Still Leaves The Door Open For Unions

by | Mar 16, 2023 | Gig Economy, Labor Relations Ink, Legal, NLRB, SEIU, States

The labor laboratory of California continues to provide fertile ground for scouting out developments that could spread across the U.S. Unions are well aware of this state’s general friendliness towards unions, too, and California’s progressive ways often lead to unions gaining a foothold with lawmakers, as with the SEIU’s recent propulsion of the Fast Food Accountability and Standards (FAST) Recovery Act. That law still aims to grant the industry’s workers the right to bargain without a union and boost hourly wages to $22, possibly to the point of financial disaster for franchises.

FAST is currently on hold until 2024, then it will land in the hands of voters, but the bill’s progress emboldened the SEIU to push for a statewide minimum $25 wage for healthcare workers in California. As well another recently proposed bill could allow home healthcare workers to bargain with the state for higher wages. What else?

The SEIU came for gig workers, and an appeals court pumped the brakes.

The powerful union is licking its wounds after a federal appeals court reversed a decision and revived a bill, Proposition 22, which had been approved by voters but declared by a lower court to be unconstitutional. With the bill back in action, drivers for app-based companies, including Uber and Lyft, will remain classified as independent contractors and won’t receive employee-based legal protections, although these app-based companies must pay drivers a minimum wage and reimburse expenses.

A note, however: The appeals court did invalidate the Prop 22 provision that made it more difficult for gig workers to unionize and collectively bargain. So, gig worker organizing remains on the table, and the SEIU is also also vows toto the California Supreme Court. The SEIU, which is notorious for sponsoring union-friendly legislations and initiatives like Fight For $15, went on record to complain that these app-based companies “buy themselves laws.”

In other gig economy-related news, the NLRB recently joined forces with the Consumer Financial Protection Bureau (CFPB) in an effort to share information between the two agencies and put out mutual feelers for misconduct from employers who electronically monitor workers and/or require them to purchase training supplies and equipment. The expressed goal: to protect workers from becoming indebted to employers and therefore unable to realistically leave and find better employment.

Few people would argue against protecting employees from the latter plight. However, the new arrangement remains murky on how it applies to gig workers, who are currently considered owners of their own independent businesses. As such, gig workers frequently provide their own equipment.

To add another wrinkle: NLRB GC Jennifer Abruzzo’s board aims to eventually revamp worker classification, thereby making it easier for gig workers to be deemed as employees rather than independent contractors. In light of the NLRB/CFPB’s collaboration, reclassification could put the onus for supplying gig workers’ equipment on employers – creating an expensive mess for companies.

If Abruzzo’s board is successful in recategorizing gig workers as employees, this collaboration would put gig businesses in the crosshairs of an NLRB that already seems to have it out for them.

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