Labor regulators issued a ruling on Tuesday that makes workers more likely to be considered employees rather than contractors under federal law.
Overturning a judgment handed down when the board was under Republican control, decision This has effectively reduced the number of workers, such as drivers, construction workers, and cleaners, who have federally protected rights to unionize and take collective action, such as protesting unsafe working conditions. To increase.
Voted 3 to 1 in favor of the ruling, which ensures that “workers who seek to organize or exercise their rights under the National Labor Relations Act are not unduly excluded from its protection.” A statement from Democratic Labor Committee Chairman Lauren McFerran said: A party that broadens its standards.
Determining whether a worker is an employee or a contractor has long depended on several variables, including the potential employer’s control over the work and the provision of tools and equipment.
In 2019, when the board was controlled by President Donald J. Trump’s appointees, the opportunity for workers to make more money based on their knowledge of the business (often described as “entrepreneurial opportunities”). ) took precedence over other considerations. The report concluded that when some factors indicate contractor status and others suggest employment, such opportunities should be important tie-breakers.
In its 2019 decision, the board said Obama-era rulings unfairly downplayed the issue of money-making opportunities.
The 2019 ruling looked like a win for gig companies like Uber and Lyft. Discussed Rideshare drivers should be considered contractors. One reason is the opportunity to gain potential profits. For example, deciding which region to work in.
The latest decision has returned the board to the standards set by the Obama era and clearly refused to elevate entrepreneurial opportunities above other factors.
The turnaround was criticized on Tuesday by companies that rely heavily on contractors. in the statementEvan Armstrong, chairman of the Workforce Innovation Coalition, which represents companies and industry groups such as Uber and Lyft, said the ruling “undermines clarity and creates flexibility that benefits workers, consumers, entrepreneurs, businesses and society.” It threatens the independent model,” he said. overall economy. ”
But some labor experts say gig companies like Uber and Lyft, which charge passenger-paid fares, have enough bona fide entrepreneurial opportunities to qualify as contractors even under the old standards. It said it wasn’t clear if it was being offered to drivers.
Marvin E. Kaplan, the board’s sole Republican, developed an interpretation of this argument in a dissenting opinion, stating that the workers in dispute on the board: wigs, hair and makeup stylists who work at the Atlanta Opera. And so on, he concluded, “there are few chances.” For economic profit or, conversely, for the risk of loss. ”
As a result, it agreed with a majority vote of the board that stylists should be considered employees with the right to form a union.
But Kaplan wrote that the lack of entrepreneurial opportunities means stylists should still be considered employees under Trump-era standards, and that didn’t need to change.