Gig economy workers deserve protection in the current crisis

By
March 18, 2020
In Commentary, COVID-19

A ride share driver picks up passengers at O’Hare Airport in Chicago, Illinois. | Scott Olson/Getty Images

As COVID-19, the disease caused by the new coronavirus, continues to spread, employees who can are staying home and practicing social distancing in order to keep themselves and their neighbors from contracting the virus. Yet one group of workers is dangerously exposed — “gig” workers.

According to a 2018 Gallup Poll, 36% of Americans participate in the gig economy in some way. That number includes freelancers and the self-employed, people who chose gig jobs for their flexibility. But it also includes a significant number of people who are actually working for a large company, but are treated as non-employees. Those are the Uber and Lyft drivers, DoorDash delivery people and Instacart shoppers; caregivers, janitors, housekeepers and handymen working on platforms like Handy.

As social distancing causes us to rely even more heavily on those gig workers who enable us to stay home and avoid crowds, gig workers are unable to do the same. Most of the app-based gig work is low-paying; workers need as many hours as possible to make ends meet.  They can’t afford to stay home and miss the opportunity to get paid in order to protect themselves and others.

Because they aren’t employees, they don’t have paid sick days. And they won’t get paid sick days through the legislation currently being contemplated in Congress. Many of them lack health insurance and are reluctant to seek medical care because of the expense. Because they are not considered employees, they are not entitled to unemployment insurance if they get laid off because of economic downturns.

Some gig companies have already announced limited steps they are taking to protect workers and hopefully, others will follow their lead.

But it isn’t enough.

We need a long-term solution that closes the loophole that allows large gig companies like Uber to profit from these workers without being required to provide them basic employment protections — solely because of the fiction that each Uber driver is in business for himself. As policymakers seek to expand the safety net to support hourly workers who will be hurt by the current crisis, they should think creatively about including gig workers, too.

Specifically, federal and state governments should move quickly to ensure that worker protections and support systems — especially paid sick days, paid medical leave and unemployment insurance — apply to gig workers too, and not just to standard employees. As the new coronavirus continues to spread, we cannot afford to leave gig workers without access to these protections. Asking sick gig workers to work puts their colleagues and customers at risk for further spreading the deadly virus.

Now more than ever gig workers need the same protections as standard employees.

Clermont F. Ripley is a senior staff attorney with the Workers’ Rights Project of the North Carolina Justice Center.

Trump’s overtime proposal leaves behind almost 300,000 North Carolina workers

By
March 27, 2019
In Commentary, Legislature, News, The State of Working North Carolina, Trump Administration

Earlier this month, the U.S. Department of Labor (DOL) announced a proposal to change the salary threshold under which workers are entitled to overtime pay — to $35,308 a year from $23,600 a year.

Under federal law, people who work more than 40 hours per week are supposed to be paid 1.5 times their regular hourly rate for each overtime hour unless they fall into one of the many overtime exemptions.   The so-called “white collar” exemption allows employers to exempt salaried workers who make above the salary threshold from overtime pay if they are engaged in executive, administrative or professional duties.  Once the proposed rule takes effect, anyone making under $35,308 per year (or $679 per week) will not qualify for the exemption.

If you are experiencing déjà vu reading this, that’s because we have been here before.  Well, kind of.  In May of 2016, after two years of research and public input, the Obama DOL also published a new rule updating the salary threshold to $47,476 per year (or $913 per week).  That rule, however, was blocked by a federal court in Texas shortly before it was due to take effect.

The Trump Administration is taking credit for this proposed change, touting it for bringing “common sense, consistency, and higher wages to working Americans,” but they are actually leaving behind millions of Americans who can be required to work 50, 60 or 70 hours per week with no additional pay.

Because the 2016 rule included automatic increases every few years, by January 1, 2020 the salary level would be about $51,000 – $16,000 higher than the Trump proposal.   According to the Economic Policy Institute, the difference in salary levels means about 278,000 people in North Carolina who would have benefited from the 2016 rule are left out by the 2019 rule.  Nationally, that number is over 8 million.

Jumping to $35,308 from $23,600 may seem like a decent increase – and going from $23,600 all the way to $47,476 may strike you as extreme – but it is important to consider those numbers in context.

DOL used to periodically update the salary threshold to reflect changes in the economy and inflation, but the only time it has been updated since 1975 (setting aside the 2016 rule which was blocked) was in 2004.

According to the National Employment Law Project (NELP), in the 1970s, about 65% of salaried workers earned under the threshold and were entitled to overtime pay.  The value of the salary threshold has eroded over time such that today, at the 2004 salary level, only 7% of salaried workers are under the salary threshold.

If the 1975 level was updated for inflation, it would be $55,000 today and would, likely, have the effect that the overtime requirement was originally intended to have: ensuring that overtime exempt employee are getting fairly compensated for extra  hours.

Between now and mid-May, the public can and should comment on the current salary proposal.

Clermont Ripley is a senior attorney at the N.C. Justice Center’s Workers’ Rights Project. 

Trump administration threatens overtime protections for low-wage workers; 290,000 in NC would lose out

By
September 7, 2018
In Commentary, Trump Administration
OT Listening Sessions

Image: US Department of Labor

Raise your hand if you are paid on a salary basis and that salary is more than $23,660 per year but less than $47,476 per year. If your hand is up, then you might* be one of the unlucky people who should be getting paid overtime pursuant to a rule revised by the U.S. Department of Labor (USDOL) under the Obama Administration, but because that rule was blocked by a federal court in Texas before it ever took effect, you aren’t entitled to overtime. Now USDOL under Trump and Secretary Alexander Acosta is poised to adopt its own overtime rule with a much lower salary threshold.

The rule, which was set to take effect December 1, 2016, before the court blocked it, would have raised the salary threshold for overtime eligibility from $23,660 per year (less than the poverty rate for a family of four) to $47,476 per year, effectively raising the amount you must be paid in order for your employer not to have to pay you overtime. This means that most* workers making less than $47,476 per year (or $913 per week) would have to be paid overtime for each hour over 40 in one workweek in addition to their salary.

What has happened to the overtime rules since December 2016? Nothing – yet. But USDOL has repeatedly expressed an intention to lower the salary level based on complaints from business groups.  Today USDOL started a series of “listening sessions” to ostensibly get the views and ideas of the public for how the overtime regulations should be revised. (Hint: “lower the salary level” is the only answer they are listening for.)

What does all this mean? Well, if your hand is still up but you make more than $31,000 per year, it’s time to put it down. Based on comments from Secretary Acosta and a USDOL “Request for Information” in July 2017, it is expected that the new salary threshold will be just $31,000, which is the 2004 overtime salary threshold adjusted for inflation. Two-thousand and four was the last time USDOL updated the salary threshold, but even then it was not an adequate adjustment.  As the Economic Policy Institute explains, using that number will leave out three-quarters of the people who would have benefited under the Obama overtime rule, including an estimated 290,000 in North Carolina. If they lower the salary threshold as expected, those 290,000 North Carolina workers will still be required to work more than forty hours per week without being adequately compensated for that extra time. Unfortunately, this is just another example of the Trump Administration’s ongoing attack on low-wage workers.

*…The overtime regulation in question only changes one of the exemptions from overtime and does not apply in all workplaces and to all types of jobs. It has to do with what are often referred to as white-collar jobs, or the Executive, Administrative, Professional exemption. See the 2016 rule for more information.

More bad news for immigrant workers

By
July 14, 2018
In agriculture, immigration, News

While members of Congress seek to make the H-2A program cheaper and easier for employers by rolling-back worker protections, the US Department of Labor  continues to kick bad-actor employers out of the program. This week the USDOL’s Wage and Hour office in Raleigh announced that they had debarred two farm labor contractors from the H-2A guestworker program.  This is just the latest in a series of such announcements, which underscores the flaws in the H-2A program.

The H-2A program allows employers to bring in foreign guestworkers to work in agriculture for up to 10 months.  By statute, H-2A visas are only supposed to be issued when importing foreign labor will not have an adverse effect on the wages and working conditions of the local workers doing the same kind of work.  To that end, DOL has passed regulations which govern the test of the local labor market which employers must first do before being permitted to bring in visa workers.

Additional regulations govern how workers – both H-2A visa workers and U.S. workers – are treated on the job, including setting a minimum wage, a minimum hours guarantee, the requirement that employers provide free housing which meets minimum standards and that employers reimburse the foreign visa workers for their inbound transportation costs and the expense of obtaining their visa.   The reimbursement requirement is important because visa workers usually arrive in the U.S. to begin working with significant debt, making it difficult for them to afford basic necessities, unlikely to complain about dangerous or illegal working conditions, and vulnerable to human trafficking as discussed in several publications (Close to Slavery, No Way to Treat a Guest) and articles (The New American Slavery: Invited to the U.S., Foreign Workers Find a Nightmare; “All You Americans Are Fired”).

This week’s announcement from the Raleigh USDOL office comes on the heels of similar announcements in April and May.  Worldwide Staffing, LLC, another H-2A Labor Contractor, was debarred by USDOL in April for  failing to reimburse employees for inbound expenses, owing wages,  failing  to provide adequate cooking facilities and overcharging for meals.  In May, USDOL announced they had debarred Marisa Garcia-Pineda, an H-2A labor contractor, who owed $195,735 in backwages, had charged illegal recruitment fees, and failed to reimburse the workers, among other violations.  That is all just from the last few months and there will be more this year.  Kudos to USDOL, but these actions represent a very small fraction of the problem because they can only debar employers from the H-2A program in the most extreme cases.

Despite the well-documented history of abuse of workers in the H-2A program, efforts in Congress to roll-back worker protections are ongoing.  Representative Goodlatte’s terrible Agricultural Guestworker Act was part of more comprehensive immigration legislation that was recently voted down in the House, but apparently Speaker Ryan has promised to address farm-labor legislation this summer.  In addition, the Trump Administration is expected to introduce new proposed rules for the H-2A program which would make it cheaper and more appealing to agricultural employers while undermining the basic protections for workers.

High Court ruling deals a blow to workers’ rights, class actions claims

By
June 23, 2018
In Courts & the Law

Last month, in the Epic Systems, Corp. v. Lewis decision, the U.S. Supreme Court all but obliterated the ability of workers who are victims of the same workplace abuse to join together to bring class or collective actions, or to pursue their claims in court. The right of workers to join together to enforce workplace laws is the cornerstone of national labor policy. Federal law gives employees the right to engage in “concerted” – or group – activities for their “mutual aid or protection” and prohibits employers from interfering with this right. Unfortunately, Justice Gorsuch’s opinion held that despite that right, it is acceptable for employers to force their employees, as a condition of employment, to sign mandatory arbitration clauses which include class or collective action waivers.

These mandatory arbitration clauses bar employees from bringing their wage and hour, discrimination, and other employment claims as class or collective actions or from obtaining relief on behalf of a group of workers. Instead, employees must pursue their claims in closed-door individual arbitrations—an expensive process that has been shown to favor corporations over individuals.

Large employers have been requiring their employees to sign away their right to bring class and collective actions or to go to court with increasing frequency. Last year, a report by the Economic Policy Institute found that more than half of private sector nonunion employees were already subject to forced arbitration clauses and 30% of those employees had also signed class action waivers. In the wake of Justice Gorsuch’s Epic Systems opinion, those numbers are sure to increase. These agreements are good for employer because they know that if an individual employee has to pursue their claim alone, chances are slim they will actually pursue it. Not only do the workers risk termination or other forms of retaliation, but in the case of unpaid wage claims, the expense of litigating a case can easily dwarf the amount of unpaid wages for an individual employee. It is far more economical to pursue those claims as a group.

This type of systemic wage theft is no small problem. Earlier this month, a new report by Jobs with Justice and Good Jobs First, found that since 2000, employers have paid out $8.8 billion to employees in wage theft litigation. Not only that, the giant companies in the Fortune 500, Fortune Global 500 and Forbes list of largest privately held firms are some of the worst offenders, with Walmart leading the pack.

Because arbitration takes place in a private forum the decisions are usually secret and do not have the effect of curbing bad behavior by these employers by bringing it to light or by allowing victims to band together. The #MeToo movement has shown that when sexual harassment and sex discrimination violations are dealt with individually and in secret, the perpetrators- be they elected officials or large corporations – will continue to break the law.

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