By: Michael Mustiglione
New York State’s Governor Andrew Cuomo aims to follow California and encourage the workforce to move away from being independent contractors to employees.
Cuomo said at a news conference he prefers to see employees to part-time “gig” workers. On the other side the country, California is getting ready to create a law that says app-hailed drivers work for, rather than simply with, their companies. Legislation that would do the same in New York is reportedly being drafted.
“As a matter of policy, we are moving more and more to an economy where nobody’s an employee, where there are fewer employees, and companies favor those arrangements because then [workers] don’t have benefits,” Cuomo said at a press conference in Manhattan. “I think we have to look at how we define ’employee’ versus ‘independent contractor’ going forward, and I think, in my opinion—forget the specifics—more people should be considered employees, because what has been happening is companies have been going out of their way to hire independent contractors to get out of those obligations.”
Cuomo added, “I don’t want to lag California in anything, I don’t want to lag any other state. I have proposed in the past, and I will propose in the future for workers, and part of that is redefining a worker as an employee as opposed to an independent contractor.”
“For purposes of worker’s compensation,” reported Crain’s New York Business, “Uber and Lyft drivers in New York are considered employees of the Black Car Fund, a semi-public nonprofit that receives a 2.5% surcharge from all rides and makes payouts to drivers injured on the job. Crain’s has reported that the arrival of app-based vehicles in New York had sent the fund’s revenues and expenditures soaring—and that a limited liability company controlled by the fund has donated heavily to New York politicians, Cuomo included.
“While the fund was created as a workaround so independent contractors would be eligible for worker’s compensation, they do not receive many other benefits and protections afforded to full-time employees by labor laws, including minimum wage,” Crain’s added. “New York City recently came up with its own workaround to ensure e-hail drivers in New York City earn the minimum wage, but it does not apply to other gig-economy workers.”
It’s a timely topic. Politico reported several days ago that “The business model of companies like Uber and Lyft, with their reliance on a vast force of independent contractors, may soon be facing an existential threat in New York State. A group of labor advocates has formed a coalition seeking to impose a new standard in New York for what qualifies as an “independent contractor.” The coalition takes direct aim at Uber’s and Lyft’s contention that it does not have to provide employee benefits like unemployment insurance to its workers because they are independent contractors, not actual employees.”
“These workers are exploited every single day,” Alison Hirsh, the political director at 32BJ, one of the coalition members, told Politico. “They are treated incredibly poorly. Their income is not reliable. Their health and welfare standards are incredibly low. They’re at the whim of these companies that dictate the terms of their work.”