Despite my advancing years, I still like to stay on the bleeding edge of tech, at least tech gadgets (in fact I would argue that I am of an age I have a hard time taking anyone seriously who calls themselves a hard-core programmer that hasn't had to write in assembly language, as I did back in college).
So I enjoy having 20-something's regale me on new tech goodies at sites like Gizmodo and Engadget. But a running theme through all these sites is their shocking economic ignorance. A good example was yesterday at Engadget with Sean Buckley writing on a decision in California to declare Uber drivers as employees of Uber rather than independent contractors. Months ago I described a similar decision as signalling the death of Uber. Buckley writes: (my emphasis added)
If you ask Uber, none of their drivers are employees -- just independent contractors who happen to use their network to get fares. If you've been watching the news though, you know some drivers disagree: filing lawsuits both in California and the UK for the right to be recognized as employees. Those drivers just got some vindication, by way of the California unemployment office. According to the Employment Development Department, at least one former Uber driver qualifies for unemployment benefits.
According to Reuters, the EDD decided that a former Uber driver in southern California was an employee; the decision was held up twice by a administrative law judge when Uber appealed. Apparently, Uber's control over the driver was a deciding factor -- the company gets to define fares, bar drivers from picking non-Uber passengers and can even charge drivers a cancellation fee for choosing not to pick up a fare. That's "in fact an employer / employee relationship," according to the decision.
Uber says this ruling doesn't have any impact on pending litigation, but it's certainly a feather in the hat of drivers who want a more traditional relationship with the company. We'll have to wait and see how that turns out as the class-action lawsuit moves forward.
I won't repeat what I wrote here, but suffice it to say that I think Uber is a dead duck in the long run if forced to treat drivers as employees.
The amazing line to me is the highlighted one. What gives the author confidence that most Uber drivers "want a more traditional relationship with the company." Is that what you want, more timeclock-punching and 100-page employee manuals? My experience is that most Uber drivers value the fact that it is not a traditional job environment, and gives them a ton of flexibility on work hours, productivity rates, etc. And why, by the way, is it assumed that every job must offer the same kind of employment relationship? If someone doesn't like Uber, there are plenty of companies that will happily treat them like a mindless drone if that is what they like rather than being treated as an independent actor.
By the way, beyond the economic and liberty issues involved, I also think the California decision is just plain wrong in terms of the control Uber exercises. Sure Uber sets standards for its drivers, but everyone does that for their contractors. They key thing it does not do is set work hours and productivity rates. They don't care when you work and they don't care how many passengers you carry in an hour, because you just get paid when you drive a customer. Can you imagine a company that doesn't care when its employees show up for work or how hard they work when they do show up? Neither can I, which tells me that this is NOT an employer-employee relationship.
Remember the conversation a few weeks ago over the NY Times article that tried to make Amazon out to be some kind of employer ogre because it sets tough productivity standards for employees? That is what companies do when they have to pay by the hour (which is essentially how all employees, especially after Obama's most recent changes, must be paid). So if you don't like companies that set tough productivity standards for workers, then why are you trying to kill labor models that don't require those kinds of standards?