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As the Gig Economy Changes Work, So Should Rules

Wall Street Journal (12/09/15) Greg Ip

As the sharing economy expands, experts say that U.S. labor law needs to be modified to ensure that workers are protected. One sharing economy company, Uber Technologies, hired 400,000 drivers in four years—and Uber drivers are seeking benefits and protections in their class-action lawsuit in San Francisco. Drivers are considered independent contractors, not employees, but regulators and others believe that these workers are being deprived of benefits and rights they would have as employees, such as vacation pay, health benefits, and the right to form unions.

About 33% of U.S. workers do temporary, part-time, or day-labor work. A new paper from the Hamilton Project says that these workers do not need to be covered by the National Labor Relations Act but should jointly negotiate work conditions through an exemption to antitrust laws. The workers would have to deduct Social Security and Medicare contributions and withhold income tax; would not be covered by federal overtime or minimum wage laws, workers’ compensation, and unemployment insurance; and would be protected by federal antidiscrimination laws.