The city of Seattle is trying to flip the Uber debate on its head.
On Monday night, City Councilmembers unanimously approved a law to create union rights for everyone who drives a for-hire vehicle in the city. It’s a novel approach to the conflict between startups like Lyft and Uber and people unable to achieve economic security driving for those firms. Because those companies consider their drivers independent contractors rather than traditional employees, federal labor law extends them no protections or rights for collective bargaining.
But the law breaks new ground in one other way, too, less as a matter of law than one of philosophy. The bill presents Uber’s resistance to worker organizing as a threat to public safety, not merely as a form of profiteering that damages drivers’ own wellbeing. For Seattle, this is as much about riders as it is about drivers.
“Drivers working under terms that they have negotiated through a collective negotiation process are more likely to remain in their positions over time, and to devote more time to their work as for-hire drivers,” the law states. “Such drivers accumulate experience that will improve the safety and reliability of the for-hire transportation services provided by the driver coordinator and reduce the safety and reliability problems created by frequent turnover in the for-hire transportation services industry.”
This motivation runs directly counter to Uber’s primary argument in support of its present business model. Many drivers believe that model is illegal, relying on a trick called “misclassification” to reduce the company’s overhead. Those drivers say they are treated like full employees, but denied the minimum wage, reimbursement, and unemployment insurance protections that traditional employee-employer relationships incur.
Uber’s main argument that the contractor designation is appropriate for their workforce is all about flexibility. Not just the flexibility to work whenever you please, but to work as many or as few hours as any one person cares to drive. The standard counterargument from labor folks and unhappy drivers is that Uber in fact exerts far more control than that over people’s ability to work and earn, both by kicking drivers out of the app if their rating falls below 4.5 of 5 stars and by refusing to pay drivers tips or compensate them for maintenance expenses and cancelled fares.
But the Seattle council’s public-safety response effectively sidesteps that dispute. Whether drivers are employees or contractors, the law says, riders deserve a transit system where operators invest long and routine hours in learning their trade. Seattle is pitting drivers’ potential preference to work only a handful of high-volume hours against the public’s interest to have its hired-cars system run by people who treat it as a full-time profession.
Drivers are likely still some ways away from enjoying the union rights Seattle wants to extend. Because union rights for contractors is a novel idea, the measure is destined for a court challenge.
Win or lose, Seattle’s safety-versus-flexibility notions here may well have an impact far from home. The policy problems Seattle is trying to address have started to attract the attention and energy of a lot of prominent people in recent years. As services like Uber and others in the so-called “gig economy” grow, the share of the American workforce that operates as freelancers rather than traditional employees has exploded.
The shift raises tough questions about what work will look like in the future and how to update Industrial Age workplace policies for the Digital Age without destroying working-class economic security.
The White House convened a summit on those questions this fall. Coming out of it, a consensus seems to be forming that lawmakers should create a third legal category for workers who have schedules too loose to fit traditional W-2 employment but also don’t really fit the purpose that 1099 independent contractor law was designed to serve.