Protecting the Sharing Economy: A Proposal for FLSA Dependent Contractor Status
Posted: 19 Jul 2015
Date Written: July 17, 2015
Recent cases involving high profile "sharing economy" pioneers are good reminders about how difficult it is to apply laws drafted in the mid-20th century to the new 21st century business models that have sprung from the advance of technology. As one judge wrote, many of the factors used in the Fair Labor Standards Act's (FLSA) employee/contractor test "appear outmoded" in the sharing economy context. Yet, these are the tests that we have and that courts must apply. Unsurprisingly, sharing economy employees who find job assignments via apps like the ones made by Uber, crowdsourcing marketplace CrowdFlower Inc., and cleaning service Handy fall smack in the middle of the gray area in wage and hour law. In some ways, these workers resemble contractors because, for example, they can choose their work hours and their jobs. In other ways, the workers resemble employees because of the degree of control the companies exercise over them.
Consequently, this forthcoming article will propose the creation of a new category of employee, modeled after those introduced in other countries ("economically dependent autonomous employee," "dependent contractor," or "employee-like person"), under the FLSA to prevent employers and courts from denying workers some minimum level of protections without destroying the "sharing economy" that is propelling innovative businesses in the 21st century economy.
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