As a part-time Lyft driver in 2020, Nicole Moore listened intently when presidential candidate Joe Biden said that companies’ refusal to treat their drivers as employees “deprives these workers of legally mandated benefits and protections.”
Labor activists like Moore, who runs a California advocacy group called Rideshare Drivers United, had hoped that Biden, as president, would lead a flurry of activity aimed at forcing gig economy companies like Uber, Lyft and DoorDash to classify drivers as employees rather than independent contractors. Such a change would mean paying drivers a minimum wage, providing them with benefits and allowing them to join unions.
By contrast, a year and a half into Biden’s presidency, little has been done at the federal level to address independent contractors. Enforcement of existing labor laws has not been significantly strengthened. And the president’s nominee to lead the Labor Department’s enforcement division was voted down by the Senate, including several Democrats.
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Administration plans to rewrite the regulations have not materialized, in part because of court rulings, while efforts by Democrats in Congress to change the law have stalled.
“There is a strong sense that the promise of what could have been has not been fulfilled,” said Veena Dubal, a professor at the University of California Hastings College of Law who has argued that drivers deserve to be treated as workers. “Not surprising, but very disappointing.”
Administration officials counter that Biden has been strong on labor issues and unions and that they have been stymied by a recent court ruling that expanded a Trump-era rule that makes it easier for companies like Uber to argue that their workers should be classified as independent contractors under federal law .
In statements, the White House and the Department of Labor emphasized the importance of addressing worker misclassification, but did not single out companies like Uber.
“The president has taken an aggressive and comprehensive approach to addressing worker misclassification,” said Alexandra LaManna, a White House spokeswoman who was Lyft’s senior communications official. He added, “This administration’s policy is to strengthen the workforce, and a solution to worker misclassification is a key part of that agenda.”
The Labor Department said it had recovered more than $9.5 million in back wages for more than 10,000 misclassified workers in fiscal year 2022 through investigations conducted by its Wage and Hour Division.
“The Department of Labor will continue to do everything in our power to ensure that workers are protected,” said Jessica Luhmann, an employee of the Wage and Hour Division. He noted that misclassification “isn’t a problem solely for workers assigned work through an app or digital platform.”
But for those who hoped the new administration would quickly push for better pay and benefits for drivers, the explanations offer little solace.
In addition to procedural hurdles like the court’s ruling, policy experts on both sides of the issue identify a broader reason for federal inaction: There is no consensus among Democrats and traditional labor groups on how best to help drivers. for ride-hailing companies — or even if the current system exploits them.
Uber and other gig companies argue that their drivers prefer to be independent contractors, who are responsible for their own expenses, because of the flexibility to work whenever and however long they want. The companies cite surveys — often commissioned by the companies themselves — in which a large majority of drivers say they prefer to keep their flexible schedules.
“App-based workers have been clear: They want to remain independent,” said Kristin Sharp, chief executive of Flex, a trade association that lobbies on behalf of gig companies.
Max Rettig, DoorDash’s head of global public policy, said DoorDash is “committed to working with policymakers, including management,” to balance flexibility with benefits for drivers. He said Biden’s team was open to hearing from concert companies.
Their argument proved effective in Washington, especially among Republicans and more moderate Democrats on Capitol Hill, though it is less clear how well it resonated in the White House.
By the time Biden took office, Uber and other companies believed they had laid the groundwork for years launching their employment model and hoped the new administration would not be keen to target them, according to labor activists and two former Uber employees who know politics. negotiations.
Labor activists say companies are offering a false choice between flexibility and worker protection. When the administration tackles worker classification, many expect it to prioritize more straightforward cases of exploitation, such as in the construction and shop sectors, that may be easier to prove in court.
In the early days of the Biden administration, there seemed to be a push to strengthen driver protections. In March of last year, the House passed the Right to Organize Act, which included language making it harder for companies to classify drivers as independent. The following month, Labor Secretary Martin Walsh suggested to Reuters that “in many cases gig workers should be classified as employees,” sending shares of gig companies’ stocks tumbling.
Biden then nominated David Weil, a labor policy expert and professor, to serve as administrator of the Labor Department’s Wage and Hour Division, a position he held under former President Barack Obama. Many believed that once confirmed, Weil would have investigated whether concert companies were violating labor laws and sought retroactive minimum wage for drivers.
In a recent interview, Weil said gigging platforms like Uber and Lyft are eroding labor protections.
“I was concerned and concerned about the creep of this idea that if you do it through a platform, it somehow throws magic dust at work and turns people from employees to independent contractors,” he said.
But Weil was never able to act on his ideas. Amid opposition from Republicans and business groups, the Senate voted against it this year, 53-47, with three Democrats, Joe Manchin of West Virginia and Mark Kelly and Kyrsten Sinema of Arizona, voting no. Gig companies also opposed his nomination, with a defunct industry group, the App-Based Work Alliance, lobbying against him.
In July, Biden nominated Luhmann, who at the time was acting administrator of the Wage and Hour Department, to fill the position.
There have been other setbacks. The Right to Organize Act has little chance of overcoming a Republican filibuster in the Senate, and a federal court in Texas ruled in March that the Biden administration had acted illegally when it withdrew the Trump administration’s company-friendly interpretation of Fair Work. Model law, which sets out workers’ rights – such as the minimum wage – and determines who is eligible for them.
Because the Trump-era interpretation still stands, lawsuits brought against concert companies by the Department of Labor will likely face significant hurdles.
“My sense is that they’re waiting to potentially get a better, more expansive rule on the books and then enforce — but then, obviously, they might be running out of time,” said Laura Padin, director of labor structures at National Employment Law Project, a worker advocacy group.
In June, the Labor Department said it was beginning the process of creating a new rule to interpret the Fair Labor Standards Act that would override the Trump-era rule and likely be more worker-friendly. But federal rulemaking can take years, and the rule is under review by the White House.
Concert lobbyists have also advanced their own proposals. In July, three members of the House introduced the Employee Flexibility and Choice Act, which would have allowed companies to require their workers to enter into “employee flexibility agreements.” These agreements would codify workers’ status as independent contractors and exempt them from certain state and federal labor law protections while giving companies the ability to offer certain benefits.
The bill is supported by the Workforce Innovation Coalition, which advocates for labor law changes on behalf of its member companies, including Uber and Lyft.
Labor activists also worry that close ties between the Biden and Obama administrations and concert companies have made officials reluctant to make concert issues a priority, though insiders say that’s not a factor. Tony West, Uber’s top lawyer, is the brother-in-law of Vice President Kamala Harris. Anthony Foxx, Lyft’s former policy chief and now a senior adviser at the company, was Obama’s transportation secretary. Valerie Jarrett, a senior adviser to Obama, is on Lyft’s board of directors. Anita Dunn, a top Biden strategist, also advised Lyft before returning to the White House in May, though officials said she had recused herself from decisions involving the company.
Even union members, longtime allies of Biden, admit his record on gigs isn’t perfect.
Bill Samuel, director of government affairs at the AFL-CIO, said he still believes the government is “determined” to reform labor laws, but “I understand people are frustrated and impatient — we are, too.”
In California, where Moore organizes the drivers, concert companies supported a ballot measure that would have made their drivers independent contractors, which voters voted down in 2020 before a judge struck it down. Companies were also blocked in Massachusetts. But without the threat of federal enforcement, their state-by-state approach got legislation passed this year in Washington, Georgia and Alabama.
Moore said she was pessimistic that Biden would follow through on his promises.
“That was definitely the hope,” he said. “I’m old enough to know you can’t pin all your hopes on any politician.”
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