New York Governor “Absolutely Looking” Into Reclassifying App-Based Gig Economy Workers As Employees


As previously outlined here, the New York City Council recently passed a package of legislation to improve the working conditions for approximately 65,000 to 80,000 app-based food delivery workers.  The six-bill package will: (i) set a minimum wage for app-based delivery workers; (ii) prevent companies like Uber Eats, DoorDash, and GrubHub from charging workers fees to receive their pay; (iii) allow workers to set a maximum travel distance for deliveries; (iv) require app-based delivery services to pay workers weekly; (v) require app-based delivery services to disclose their tipping policies; (vi) prohibit them from charging workers for insulated food bags; (vii) ensure that workers have access to bathrooms. 

This legislation comes on the heels of a decision from a California Superior Court Judge ruling that the “App-Based Drivers as Contractors and Labor Policies Initiative”—more commonly known as Proposition 22—violates the California State Constitution.  By way of background, Proposition 22 reclassified California gig economy workers as “independent contractors” following a targeted and historically expensive campaign by companies like Uber, Lyft, DoorDash, and Instacart.  This campaign was initiated in direct response to a California Supreme Court decision, which was followed by analogous legislation, that made it far more difficult for employers to classify their employees as independent contractors, and thus deny them payment for all hours worked and overtime, as well as various other terms and conditions of employment available only to those considered “employees” under the law.  As discussed here, before being ruled unconstitutional, the devastating effects of Proposition 22 on California gig workers had already begun to unfold.

While Proposition 22 impacts California workers only, the passing of and legal challenges to the ballot initiative have become national stories, given inevitable (and, in some cases, already ongoing) efforts to pass similar legislation in other states.  This undoubtedly played a role in the New York City Council’s decision to fast-track the above-summarized legislation package.  

The national prominence of Proposition 22 has seemingly sparked the political imagination of New York State’s Chief Executive, too.  Indeed, New York State Governor Kathy Hochul recently mentioned during a news conference that her administration is “absolutely looking” at reclassifying app-based delivery workers as employees.  Presumably, this would involve reviving the nine-member “Digital Marketplace Worker Classification Task Force” (“Task Force”) contemplated by former Governor Andrew Cuomo’s January 2020 executive budget proposal.  Per the proposal, the Task Force was to recommend changes to applicable laws and regulations concerning, among other things, the “wages, classification, [and] employment criteria” applicable to app-based workers.  Unfortunately, the Task Force never gained traction, as Governor Cuomo’s executive priorities shifted following the COVID-19 pandemic, his book tour in the midst of the same, and a series of credible sexual harassment allegations that ultimately caused him to resign from his office.  Hopefully, Governor Hochul can bring the Task Force back to life and, in turn, provide iron clad legal protections to gig economy workers who—perhaps more than any other class of worker over the last two years—have constantly had their right to fair wages placed in jeopardy.  
 

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