Gig workers with smartphones can help set infrastructure priorities

With all the focus on whether Congress will enact a major infrastructure law to rebuild the United States’ roads, bridges, railways, etc., nobody seems to be paying attention to the elephant in the room: Even if the legislation is passed, where do we begin? You might be surprised to learn that the gig economy has an app for that.

We can and should hire professional consultants and other experts to review our infrastructure systems to see what needs the most immediate attention, but the sheer number of roads, bridges, dams and other critical infrastructure in the U.S. makes the job of prioritizing daunting.

According to the American Society of Civil Engineers’ 2021 Report Card for America’s Infrastructure, there are over 4 million miles of public roads, 617,000 bridges, 91,000 dams and 140,000 rail miles in the U.S. These are massive statistics.

So as soon as an infrastructure bill passes, the big questions will be: Where do we begin, and how do we set priorities — expeditiously and at minimum cost, at least for the first step? The next step would be to bring in professional engineers and experts to begin the rebuilding process.

There are some obvious examples of infrastructure systems needing immediate, prioritized attention (see the Sidney Sherman Bridge in Houston, which had to be shut down a few years ago for a corroded bridge bearing and was recently classified as “structurally deficient”).

Fortunately, there is another massive statistic out there that can help: 216 million. That is the approximate number of U.S. adults that own a smartphone. Pew Research Center recently found that 85% of all U.S. adults own a smartphone, which, needless to say, is the highest it’s ever been. Even enlisting just a small percentage of the 216 million smartphone users out there can help immensely with this task.

Federal, state and local governments can and should consider the awesome (and relatively inexpensive) power of our smartphones and the gig economy. Gig workers can be enlisted to use the smartphones that they already own to provide inspection data and photographs of the key identified roads, bridges, dams and rails in the 50 states. The data and photos they collect can then be instantly transmitted to a national database for review and evaluation by professional engineers and consultants.

I know this can be done because my colleagues and I have done this before. We tap into a worldwide network of gig workers (data collectors or data contributors) operating from an open source app and with full transparency.

Our projects have involved contributors photographing and documenting sewer access points, bridges, water access points and other infrastructure systems. We even partnered with a major nonprofit on behalf of USAID’s Bureau for Humanitarian Assistance to bolster its Water, Sanitation and Hygiene (WASH) Program by providing rapid WASH needs assessments wherein our contributors can be mobilized on an emergency basis to provide photographs and other data on water access, sanitation and hygiene in Colombia.

Why can’t we do the same for bridges, roads, tunnels and other infrastructure here in the U.S.? This technology needs to be scaled, and we know it can be done.

It’s simple — and the solution is in plain sight. Our smartphones and gig workers allow us to set priorities using their photos and input from what their eyes are seeing, and then professional experts can follow up to begin implementation. There are already provisions in the Senate bill that could provide funding for this type of advanced technology research. And there is an ongoing need, even after repairs are done, to monitor the condition of our highways, bridges and tunnels.

Using this gig-worker-enabled smartphone technology will not only help our federal, state and local governments set priorities quickly; it will also allow thousands of everyday Americans to be part of the rebuilding process. This has the added benefit of democratizing the job of fixing our infrastructure and creating a grassroots movement of people using their own smartphones to help rebuild and repair U.S. infrastructure for the current and future generations.

#column, #congress, #gig-economy, #infrastructure, #labor, #opinion, #smartphone, #tc, #united-states

Dutch court finds Uber drivers are employees

Uber has lost another legal challenge in Europe over the employment status of drivers: The Court of Amsterdam, in the Netherlands, has ruled that drivers for Uber are employed, rather than self employed contractors.

The court also found drivers are covered by an existing collective labor agreement in the country — which pertains to taxi drivers — meaning Uber faces increased costs to comply with the agreement which sets pay requirements and covers benefits like sick pay. (And it may be liable for paying driver back pay in some cases.)

The court also ordered Uber to pay €50,000 in costs.

The ride hailing giant has some 4,000 drivers working on its platform in the Dutch capital.

The Amsterdam court rejected Uber’s customary defence that it’s just a technology platform that connects passengers with taxi service providers — finding instead that drivers are only self employed ‘on paper’.

The judges highlighted the nature of the service being provided by drivers and the fact Uber exerts controls over how they can work and earn through its app and algorithms.

Europe’s top court already ruled back in 2017 that Uber is a transport provider and must comply with local transport laws — so you’d be forgiven for deja vu.

The Dutch lawsuit was filed by the national trade union center, FNV, last year — with the hearing kicking off at the end of June.

In a statement today, the FNV’s VP, Zakaria Boufangacha, said: “This statement shows what we have been saying for years: Uber is an employer and the drivers are employees, so Uber must adhere to the collective labor agreement for Taxi Transport. It is also a signal to The Hague that these types of constructions are illegal and that the law must therefore be enforced.”

Uber has been contacted for a response to the ruling.

At the time of writing the company had not responded — but, per Reuters, Uber said it intends to appeal and “has no plans to employ drivers in the Netherlands”.

In the UK, Uber lost a string of tribunal rulings over its employment classification over a number of years — going on to lose in front of the UK supreme court this February.

Following that Uber said it would treat drivers in the UK as workers, although disputes remain (such as over its definition of working time). In May, Uber also said it would recognize a UK trade union for the first time.

Elsewhere in Europe, however, the company continues to fight employment lawsuits — and to lobby European Union lawmakers to deregulate platform work…

The EU has said it wants to find a way to improve platform work. However it’s not yet clear what any pan-EU ‘reform’ may look like. 

The Commission has been contacted with questions on its platform work initiative.

“Digital labour platforms are clearly worried, evident through investing heavily on their lobbying power and throwing more resources on the EU level. These companies — including Uber of course — have also recently come together to create a new funding lobby group that specifically targeting to influence policies on platform work,” said Jill Toh, a PhD researcher in data rights at the University of Amsterdam, talking to TechCrunch after the Amsterdam ruling.

“We saw how Uber wielded and amended laws in their Prop 22 campaign in California, and together with other companies in Europe, they’re attempting to do so again. It’s disheartening to see that the Commission in its two consultations on platform worker regulation has only been talking to tech companies and has held no meetings with trade unions or other platform work representatives.”

“All of this is incredibly problematic and concerning especially if the EC consultations result in a directive on platform work. Overall, the wins in the courts are important for workers, but there remains the issue of corporate power and influence in Brussels, as well as the lack of public enforcement to these court decisions,” she added.

#amsterdam, #ec, #europe, #european-union, #gig-economy, #labor, #netherlands, #platform-worker-rights, #tc, #transportation, #uber

DoorDash workers protest outside CEO Tony Xu’s home demanding better pay, tip transparency and PPE

California DoorDash workers protested outside of the home of DoorDash CEO Tony Xu on Thursday, prompted by a recent California Superior Court Judge ruling calling 2020’s Proposition 22 unconstitutional. Prop 22, which was passed last November in California, would allow app-based companies like DoorDash, Uber and Lyft to continue classifying workers as independent contractors rather than employees.

A group of about 50 DoorDash workers who are affiliated with advocacy groups We Drive Progress and Gig Workers Rising traveled caravan style to the front of Xu’s house in the Pacific Heights neighborhood of San Francisco. They demanded that DoorDash provide transparency for tips and 120% of minimum wage or around $17 per hour, stop unfair deactivations and provide free personal protective equipment, as well as adequate pay for car and equipment sanitizing. 

“Dasher concerns and feedback are always important to us, and we will continue to hear their voices and engage our community directly,” a DoorDash spokesperson told TechCrunch. “However, we know that today’s participants do not speak for the 91% of California Dashers who want to remain independent contractors or the millions of California voters who overwhelmingly supported Proposition 22. The reality is, the passage of Prop 22 has addressed in law many of the concerns raised today through its historic benefits and protections: workers earn 120% of their local minimum wage per active hour in addition to 100% of their tips, receive free PPE and enjoy access to healthcare funds.”

DoorDash drivers say getting paid for the time they’re “active,” meaning actively driving to either pick up food and drop it off, rather than when they’re online and waiting for gigs to come through, leads to inadequate pay. They also say much of their living wage comes from tips, which should be an added bonus, but ends up helping make ends meet based on DoorDash’s pay structure. Prop 22 is also meant to guarantee a reimbursement of 30 cents per engaged mile, which drivers say “would be great if it were true.” DoorDash did not respond to follow ups regarding its pay structure or claims from dashers that they have not been given free PPE. 

Rondu Gantt, a gig worker who’s been working for DoorDash for two and a half years and also drives for Uber and Lyft to get by, says his base pay from DoorDash is often as low as $3 per hour, and that around 40% to 60% of his money comes from tips. Although this model sounds similar to the restaurant industry in the United States, which can be quite lucrative for servers and bartenders, for a delivery driver, it’s an unsustainable way to make a living because tipping culture isn’t nearly as strong. 

“DoorDash pays so low because they want to make it affordable for the customer, but I would say for the driver it becomes unaffordable,” Gantt told TechCrunch, citing the costs of owning, maintaining, parking and fueling a vehicle as potentially crippling. “Last week, I drove for 30 hours and I made $405. That’s $13.50 per hour, which is below minimum wage.”

Gantt said drivers also have had to deal with pressure to drive in unsafe conditions, and we can look to the images of delivery drivers in New York City during Hurricane Ida as an example of some conditions drivers feel compelled to accept. Over the past two years, DoorDash drivers have also been deemed essential workers, interacting with and providing services for many people during a pandemic at the risk of their health. 

Gig Workers Rising says DoorDash workers “have received little to no safety support” with some workers reporting “being reimbursed as little as 80 cents per day for cleaning/sanitizing equipment and PPE that they use to keep themselves and customers safe.”

“Right now gig work isn’t flexible,” a spokesperson for Gig Workers Rising told TechCrunch.  “Workers are at the mercy of when there’s demand. If they were employees the work would change as they’d work in the knowledge that they’ve healthcare and can take a sick day off.”

Because Prop 22 was ruled unconstitutional, the spokesperson said by rights it shouldn’t be in operation. 

“The gig corporations violate that law everyday by choosing not to comply with it,” he said. 

For Gantt’s part, he doesn’t necessarily want to be an employee, he just wants to make sure that he’s being paid what he deserves. 

“Which is not minimum wage,” he said. “Minimum wage would be unacceptable as well. The cost of doing this, the danger, makes minimum wage unacceptable pay. And realistically, they’re only sometimes paying you minimum wage before taxes. After taxes you’re definitely making less.”

TechCrunch was given access to DoorDash workers’ dashboards that break down their pay. For the week of July 12 to July 19, one dasher was paid a total of $574.21 for 53 deliveries, $274 of which came from customer tip. His “active time” was 14 hours and 21 minutes, and his “dash time,” or when he was logged onto the app waiting for gigs to come through and doing deliveries, was about 30 hours. 

The dasher’s “guaranteed earnings” from DoorDash for the week was $300.21. (DoorDash did not respond to clarification on how guaranteed weekly earnings are calculated or what they’re based on, but a post on the company’s site says that guaranteed earnings are incentives for dashers in specific areas.) His base pay ended up at about $257.62, but DoorDash added an additional $42.59 to adjust to guaranteed earnings. If we divide the amount DoorDash paid by the number of hours of “active time,” the worker was paid about $21 per hour. If we divide it by the “dash time,” it looks more like $10 per hour. 

Again, this is before tax. Independent contractors are usually advised to put aside around 30% of their paycheck because they have to pay self-employment tax, which is 15.3% of taxable income, federal income tax, which varies depending on tax bracket, and potentially state income tax. After taxes, this dasher’s total pay for 30 hours of work, including his $274 worth of tip, would be around $402, which comes out to $13.40 per hour. 

Tips were of concern at the protest on Thursday as drivers called for transparency. Gantt says dashers can see a cumulative amount of tip earnings per week, as well as how much tip they’re receiving from each order, but they don’t trust the amount they’re receiving is actually the amount customers are tipping them.

Gantt and other drivers aren’t just being paranoid. Last November, DoorDash agreed to pay $2.5 million to settle a lawsuit alleging the company stole drivers’ tips and allowed customers to think their tip money was actually going to the drivers. The suit, filed by Washington, D.C. attorney general Karl Racine, alleged DoorDash reduced drivers’ pay for each job by the amount of any tip. 

One of the rallying cries of the protest was for Xu to “share the wealth.” In 2020, the CEO was reportedly the highest paid CEO in the Bay Area, making a total income of $413.67 million, which includes salary and stock options. During the second quarter, DoorDash saw a $113 million profit adjusted for EBITDA, but was overall unprofitable with a net loss of $102 million. 

“We all work for money and how that money gets distributed when they go through their earnings is telling you who matters and who doesn’t matter,” said Gantt. “It’s a clear sign of who’s important, who has value. If they don’t pay you, they don’t value you.”

#doordash, #food, #gig-economy, #gig-workers-rising, #labor, #prop-22, #strike, #tc, #tony-xu, #transportation

Gig companies take worker classification fight to Massachusetts through ballot initiative

A coalition of app-based ride-hailing and on-demand delivery companies including Lyft, Uber, Doordash and Instacart have filed a petition for a ballot initiative in Massachusetts that would keep gig economy workers classified as independent contractors as the industry takes a fight it won in California on the road.

The ballot measure proposed by the Massachusetts Coalition for Independent Work comes nearly a year after California voters approved a similar measure known as Proposition 22 that pitted labor rights advocates against gig economy companies in a costly multimillion battle.

Lyft, Uber and other members of the coalition, which also includes several local chambers of commerce in the state, said Tuesday they want the ballot question included in the November 2022 election. The question has to pass a legal review and receive enough signatures from voters for it to be included on the ballot.

“While our priority is to find a legislative solution in Massachusetts, this part of our continued efforts to advocate what the vast majority of drivers want — a flexible earning opportunity that our platform provides plus new benefits,” Lyft co-founder John Zimmer said during Lyft’s earnings call Tuesday. ” While we’re pursuing the ballot option, we’re also closely engaged with the Massachusetts State Legislature and are continuing to work with them on a potential legislative solution.”

The coalition said the proposed ballot question would grant app-based ride-hail and delivery workers new benefits such as healthcare stipends while keeping them classified as independent contractors.

Among the provisions that the coalition touted would be an earnings floor equal to 120% of the Massachusetts minimum wage ($18 per hour in 2023 from app-based platforms, before customer tips) and healthcare stipends for drivers who work at least 15 hours per week. Drivers would still keep all of their tips and be guaranteed at least $0.26 per mile to cover vehicle upkeep and gas, according to the coalition.

Labor activists are already pushing back. The Coalition to Protect Workers’ Rights, a group composed of a variety of organizations including the NAACP New England Area Conference, the Union of Minority Neighborhoods and the Massachusetts Immigrant and Refugee Coalition, said Tuesday the ballot measure contains problematic language that will hurt workers.

The group argued there are extensive loopholes that create a subminimum wage for app-based workers and that few qualify for healthcare. It also noted that the measure would remove anti-discrimination protections, eliminates workers’ compensation rules and allows companies to cheat the state unemployment system of hundreds of millions.

While Uber, Lyft and the broader coalition lobbies for either a ballot measure or legislation, it also faces a lawsuit filed last year by the Massachusetts Attorney General Maura Healey who has asked the court to rule that Uber and Lyft drivers are employees under Massachusetts Wage and Hour Laws.

The AG’s Office alleges in its complaint that Uber and Lyft are unable to meet a three-part test under state law that would allow them to classify drivers as independent contractors. To qualify as an independent contractor the worker must be free from a company’s direction and control, perform services outside the usual course of the business and does similar work on their own.

Uber has been signaling since last year that it planned to push for laws similar to the Proposition 22 measure. Uber CEO Dara Khosrowshahi said in November 2020 during an earnings call with analysts that the company will “more loudly advocate for laws like Prop 22.” He later added that it will be a priority of the company “to work with governments across the U.S. and the world to make this a reality.”

#automotive, #doordash, #gig-economy, #lyft, #transportation, #uber

Catch takes hold of $12M to provide benefits that aren’t tied to employers

Catch is working to make sure that every gig worker has the health and retirement benefits they need.

The company, which is in the midst of moving its headquarters to New York, sells health insurance, retirement savings plans and tax withholding directly to freelancers, contractors or anyone uncovered.

It is now armed with a fresh round of $12 million in Series A funding, led by Crosslink, with participation from earlier investors Khosla Ventures, NYCA Partners, Kindred Ventures and Urban Innovation Fund, to support more distribution partnerships and its relocation from Boston.

Co-founders Kristen Anderson and Andrew Ambrosino started Catch in 2019 and raised $6.1 million previously, giving it a total of $18.1 million in funding.

It took the Catch team of 15 nearly two years to get approvals to sell its platform in 38 states on the federal marketplace. Anderson boasts that only eight companies have been able to do this, and three of them — Catch included — are approved to sell benefits to consumers. The other side of the business is payroll, and the company has gathered thousands of sources based on biller.

“More companies are not offering healthcare, while more people are joining the creator and gig economies, which means more people are not following an employer-led model,” Anderson told TechCrunch.

The age of an average Catch customer is 32 years old, and in addition to current offerings, were asking the company to help them set up income sources, like setting aside money for taxes, retirement, as well as medical leave without having to actively save.

When the global pandemic hit, many of Catch’s customers saw their income collapse, 40% overall across industries, as workers like hairstylists and cooks had income go down to zero in some cases.

It was then that Anderson and Ambrosino began looking at partnership distribution and developed a network of platforms, business facilitation tools, gig marketplaces and payroll companies that were interested in offering Catch. The company intends to use some of the funding to increase its headcount to service those partnerships and go after more, Anderson said.

Catch is one startup providing insurance products, and many of the competitors either do a single offering and do it well, like Starship does with health savings accounts, Anderson said. Catch is taking a different approach by offering a platform experience, but going deep on the process, she added. She likens it to Gusto, which provides cloud-based payroll, benefits and human resource management for businesses, in that Catch is an end-to-end experience, but with a focus on an individual person.

Over the past year, the company’s user base tripled, driven by people taking on second jobs and through a partnership with DoorDash. Platform users are also holding onto 5 times their usual balances, a result of setting more goals and needing to save more, Anderson said. Retirement investments and health insurance have grown similarly.

Going forward, Anderson is already thinking about a Series B, but that won’t come for another couple of years, she said. The company is looking into its own HSA product as well as disability insurance and other products to further differentiate itself from other startups, for example, Spot, Super.mx and Even that all raised venture capital this month to provide benefits.

Catch would also like to serve a broader audience than just those on the federal marketplace. The co-founders are working on how to do this — Anderson mentioned there are some “nefarious companies out there” offering medical benefits at rates that can seem too good to be true, but when the customer reads the fine print, finds out that certain medical conditions are not covered.

“We are looking at how to put the right thing in there because it does get confusing,” Anderson added. “Young people have cheaper options, which means they need to make sure they know what they are getting.”

 

#andrew-ambrosino, #crosslink, #doordash, #ecommerce, #employee-benefits, #funding, #gig-economy, #gig-workers, #health, #health-insurance, #khosla-ventures, #kindred-ventures, #kristen-anderson, #labor, #nyca-partners, #recent-funding, #startups, #tc, #urban-innovation-fund

Amazon is using algorithms with little human intervention to fire Flex workers

An Amazon Flex driver delivers an armload of packages in Cambridge, Mass., on Dec. 18, 2018.

Enlarge / An Amazon Flex driver delivers an armload of packages in Cambridge, Mass., on Dec. 18, 2018. (credit: Pat Greenhouse | The Boston Globe | Getty Images)

Locked gates, inclement weather, and bad selfies—all reasons drivers report that they were fired by the bots that apparently run human resources for Amazon’s Flex delivery program.

Millions of independent contractors are at the whim of a system that Amazon knows is problematic, according to a new report by Bloomberg. While serious early glitches have been worked out, significant issues remain, according to the article. Amazon is reportedly unconcerned about the hiccups and bad press that result so long as sufficient numbers of drivers are available to replace those whose accounts are mistakenly terminated.

“Executives knew this was gonna shit the bed,” a former engineer who designed the system told Bloomberg. “That’s actually how they put it in meetings. The only question was how much poo we wanted there to be.”

Read 11 remaining paragraphs | Comments

#amazon, #amazon-flex, #amazon-logistics, #gig-economy, #policy

Daily Crunch: Biden’s labor secretary says gig workers should be reclassified

The Biden administration hints at gig economy changes, Blue Origin will be taking passengers and we interview Jim Belushi about weed. This is your Daily Crunch for April 29, 2021.

The big story: Biden’s labor secretary says gig workers should be reclassified

The Biden administration’s labor secretary Marty Walsh recently said in an interview with Reuters that he’s “looking at” the gig economy.

“In a lot of cases gig workers should be classified as employees,” Walsh said. “In some cases they are treated respectfully and in some cases they are not and I think it has to be consistent across the board.”

For now, this is just talk, but it suggests that new regulations and gig work reclassification could be a priority for the new administration.

The tech giants

Google Pay update adds grocery offers, transit expansions and spending insights — Through partnerships with Safeway and Target, Google Pay users will now be able to browse their store’s weekly circulars showcasing the latest deals.

Zynga and Rollic acquire the hyper-casual game studio behind High Heels — The company said High Heels (or, if you insist, High Heels!) has been downloaded more than 60 million times since it launched in January.

IBM is acquiring cloud app and network management firm Turbonomic for up to $2B — Turbonomic provides tools to manage application performance, along with Kubernetes and network performance.

Startups, funding and venture capital

Blue Origin will start selling tickets for New Shepard space tourism flights on May 5 — The “when and how much” are the two burning questions that remain around the Jeff Bezos-backed space company’s first commercial passenger flights.

TravelPerk raises $160M in equity and debt after a year of derailed business trips — TravelPerk lets users compare, book and invoice trains, cars, flights, hotels and apartments from a range of providers.

MoviePass co-founder’s PreShow Interactive raises $3M to expand into gaming — The startup will give PC and console gamers a new way to earn in-game currency in exchange for watching ads.

Advice and analysis from Extra Crunch

Healthcare is the next wave of data liberation — David Jegen and Carl Byers of F-Prime Capital argue that the winners of the healthcare data transformation will look different than they did with financial data.

Fintech startups set VC records as the 2021 fundraising market continues to impress — New data indicate Q1 2021 was the biggest fintech VC quarter ever.

How to fundraise over Zoom more effectively — A year ago, many of us probably thought that virtual fundraising would be impossible.

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

Everything else

Jim Belushi is chasing the magic in cannabis — We interviewed Belushi about his new greenhouses, supplied in part by GrowGeneration.

U.S. video game spending increased 30% in Q1 — Content was up 25% for the quarter, accessories jumped 42% and hardware went up 82%, according to NPD.

Sequoia’s Shaun Maguire and Vise’s Samir Vasavada will talk success in fintech on Extra Crunch Live — Join us on May 19 to discuss what brought the pair together, key tips for fundraising and how to be successful in the fintech space.

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 3pm Pacific, you can subscribe here.

#daily-crunch, #gig-economy, #policy

Biden’s labor secretary thinks many gig workers should be reclassified as employees

Biden Labor Secretary Marty Walsh charged into the white hot issue of the gig economy Thursday, asserting that many people working without benefits in the gig economy should be classified as employees instead.

In an interview with Reuters, Walsh said that the Department of Labor is “looking at” the gig economy, hinting that worker reclassification could be a priority in the Biden administration.

“… In a lot of cases gig workers should be classified as employees,” Walsh said. “In some cases they are treated respectfully and in some cases they are not and I think it has to be consistent across the board.”

Walsh also said that the labor department would be talking to companies that benefit from gig workers to ensure that non-employees at those companies have the same benefits that an “average employee” in the U.S. would have.

“These companies are making profits and revenue and I’m not [going to] begrudge anyone for that because that’s what we are about in America… but we also want to make sure that success trickles down to the worker,” Walsh said.

Walsh’s comments aren’t backed by federal action, yet anyway, but they still made major waves among tech companies that leverage non-employee labor. Uber and Lyft stock dipped on the news Thursday, along with Doordash.

In the interview, Walsh also touched on pandemic-related concerns about gig workers who lack unemployment insurance and health care through their employers. The federal government has picked up the slack during the pandemic with two major bills granting gig workers some benefits, but otherwise they’re largely without a safety net.

Reforming labor laws has been a tenet of Biden’s platform for some time and the president has been very vocal about bolstering worker protections and supporting organized labor. One section of then President-elect Biden’s transition site was devoted to expanding worker protections, calling the misclassification of employees as contract workers an “epidemic.”

Biden echoed his previous support for labor unions during a joint address to Congress Wednesday night, touting the Protecting the Right to Organize Act — legislation that would protect workers looking to form or join unions. That bill would also expand federal whistleblower protections.

“The middle class built this country,” Biden said. “And unions build the middle class.”

#america, #biden, #biden-administration, #congress, #department-of-labor, #economy, #employment, #federal-government, #gig-economy, #gig-workers, #government, #labor, #president, #secretary, #tc, #temporary-work, #united-states

Tyltgo’s same-day delivery platform lets small businesses compete with Amazon

Tyltgo wants to make it easier for restaurants and small businesses to compete with same-day delivery services offered by the likes of Amazon and HelloFresh. The Canadian company, which recently raised CAD $2.3 million (USD $1.8 million) in a seed round, is akin to a white label Uber Eats, providing businesses an on-demand delivery platform under their own branding that connects them to gig economy couriers.

“I think about us as a post-purchase experience company,” co-founder and CEO Jaden Pereira told TechCrunch. “The recipient goes directly onto the merchant’s platform and places orders through them, so it feels like they’re interacting with the brand they purchased from throughout the entire experience. Our messages, notifications, tracking pages and delivery are all customized under the merchant’s brand name, but it’s powered by Tyltgo.”

The necessity of having products delivered during the pandemic’s shelter-in-place orders combined with the massive reach of e-commerce giants like Amazon has created a society that expects same-day deliveries. Tyltgo recognized the exclusionary nature of that reality on smaller businesses with less time and fewer resources, and contrived to remedy the situation with some innovative tech and gig economy couriers.

In July 2018, Pereira, 22, co-founded the company with fellow student and developer Aaron Paul while studying at the University of Waterloo. Pereira originally did deliveries himself as a side hustle, while building up a consumer-facing service on Shopify. In October 2019, Pereira and Paul shifted focus to B2B, identifying the real problem as merchants struggling to offer quality same-day delivery at an affordable price.

From December 2019 to December 2020, Tyltgo’s revenue grew 2000%, says Pereira. The company started 2020 with two staff members and ended with nine, including former head of Uber Eats Canada’s marketplace operations, Joe Rhew, and former director of engineering at Goldman Sachs-acquired fintech company Financeit, Adnan Ali.

Aided by funding from VC firm TI Platform Management, Y Combinator and angel investor Charles Songhurst, Tyltgo projects another 1500% revenue growth for 2021. The company’s goal is to expand its team, develop an API and app-based platform, and add 100 more merchants across Ontario.

Pereira said Tyltgo originally focused on florists, and occasionally pharmacies, but demand from the restaurant industry led to the company’s new target — meal kit deliveries.

Meal kit services that provide the culinarily challenged with perfectly portioned ingredients and cooking instructions were already gaining popularity in the before times. When the pandemic hit, services like HelloFresh and Blue Apron saw even more growth. As restaurants struggled to keep their businesses open, many started to get in on the action, delivering restaurant-quality meals with instructions for heating and serving.

The global meal kit delivery services market is expected to reach almost $20 billion by 2027, with heat-and-eat options taking a large share of that market. Tyltgo is counting on the success of this industry. It has already secured partnerships with restaurants like General Assembly Pizza and Crafty Ramen, as well as with more traditional meal kit delivery services from grocery stores and organic farms.

Pereira said working in the “quasi-perishable space” of flowers and meal kits is both a challenge and a differentiator for the company. Depending on the contents of the delivery, Tyltgo will determine its perishability window and make sure to match that window with a driver. It’s also got an advanced fleet management platform that assigns a number of deliveries to suit the size of a courier’s vehicle.

“In the earlier days, the hardest part was being able to match those perishability windows without causing damage to the products,” said Pereira. “We all know that in logistics, you have to account for traffic, weather conditions, all these other things, but you have an eight hour delivery window to get out 35 deliveries.”

Another challenge is ensuring the top quality service Tyltgo advertises while working in the gig economy. Selecting for reliable couriers has slowed the company down at points, but Tyltgo aims to grow capacity only if it can simultaneously maintain a low error threshold.

“We won’t bring on a merchant if we don’t think we have the capacity to handle their deliveries and meet those expectations,” said Pereira.

Whether or not Tyltgo’s meal kit focus will end up driving scalability in the long run, the platform itself has legs. Pereira’s goal is to see Tyltgo become a part of every post-purchase customer experience for all retail trade categories, and that includes expanding into customer service, branding and transactions on top of delivery.

“The main reason why we’re doing this is because a lot of these smaller, brick-and-mortar retailers don’t have the time and resources to be able to compete with the Amazons of the world,” said Pereira. “We want to be able to put that power in their hands.”

#amazon, #blue-apron, #canada, #companies, #courier, #gig-economy, #hellofresh, #meal-kit, #mobility, #online-food-ordering, #shopify, #tc, #uber, #uber-eats, #university-of-waterloo, #y-combinator

Uber entices drivers back post-pandemic with $250 million stimulus

Despite the classification of ride-hail drivers as “essential workers” during the early days of the pandemic, last April Uber’s business dropped by 80%. Drivers decided they’d rather not risk contracting or spreading COVID-19 for the measly revenue provided by the few rides per day they were getting, so when the federal CARES Act extended the Pandemic Unemployment Assistance to gig workers, many Uber drivers decided to hang up their keys. 

With more than a quarter of the U.S. population already vaccinated, Uber is now in a sticky situation wherein there are more riders requesting trips than there are drivers available. The ride-hailing giant not only wants drivers to know that there’s business to be had once again, but they also want to sweeten the deal with incentives. 

On Wednesday, the company announced the launch of a $250 million driver stimulus to welcome drivers back into the fold and recruit new ones as the pandemic begins to ease in the U.S. Both returning drivers and new drivers will be receiving bonuses over the coming months, according to an Uber spokesperson.  

“In 2020, many drivers stopped driving because they couldn’t count on getting enough trips to make it worth their time,” reads the blog post announcing the stimulus. “In 2021, there are more riders requesting trips than there are drivers available to give them—making it a great time to be a driver.”

Due to high rider demand and low supply of drivers, the current median hourly rate for cities like Philadelphia, Austin, Chicago, Miami and Phoenix is $26.66, which is 25% to 75% higher than they were in March of last year. Uber wants drivers to take advantage of the higher earnings now because “this is likely a temporary situation.” Meaning as the country recovers and more gig workers get back behind the wheel, earnings will likely decrease from their current levels. 

The stimulus money will go on top of those hourly rates, a spokesperson told TechCrunch. The incentive structure will be based on individual activity, as well as location. For example, in Austin, drivers are guaranteed $1,100 if they complete 115 trips. In Phoenix, drivers can earn an extra $1,775 for 200 trips. 

The money will also go towards guaranteed minimum pay and on-boarding for new Uber drivers, and the full $250 million pool is coming directly from Uber’s pockets. The company’s shares declined as much as 3.6% during trading on Wednesday. 

Uber is also aiming to help streamline the process of getting drivers vaccinated with an in-app booking portal as part of its partnership with Walgreens.

#automotive, #gig-economy, #gig-workers, #on-demand, #ride-hailing, #rideshare, #transportation, #uber, #uber-drivers

Gig companies fear a worker shortage, despite a recession

Gig companies fear a worker shortage, despite a recession

Enlarge (credit: Ore Huiying/Bloomberg via Getty Images)

Unemployment in the US remains stubbornly high at 6.3 percent. Job growth has stalled, with 9.6 million fewer jobs in January than the same month a year earlier. But gig companies say they’re having trouble finding people to drive, pick up, and deliver for them.

“I’m worried about one thing going into the second half of the year: Are we going to have enough drivers to meet the demand that we’re going to have?” Uber CEO Dara Khosrowshahi told an analyst last month. DoorDash chief financial officer Prabir Adarkar called the situation “a tale of two cities,” with hordes of new customers racing to order takeoutbut fewer drivers offering to deliver it. DoorDash orders more than tripled in the last part of 2020, compared with the same period a year earlier.

The looming driver shortage confounds executives’ predictions. “With record unemployment, we expect driver supply to outstrip rider demand” for the “foreseeable future,” Lyft CEO Logan Green said in May. For a time early in the pandemic, Lyft blocked new drivers from signing up. It was understandable, because today’s tech gig companies were born during the Great Recession. They benefited from a deep pool of workers newly outfitted with smartphones and suddenly in need of supplemental income.

Read 13 remaining paragraphs | Comments

#doordash, #gig-economy, #pandemic, #policy, #postmates, #uber

Europe kicks off bid to find a route to ‘better’ gig work

The European Union has kicked off the first stage of a consultation process involving gig platforms and workers. Regional lawmakers have said they want to improve working conditions for people who provide labor via platforms which EU digital policy chief, Margrethe Vestager, accepted in a speech today can be “poor” and “precarious”.

Yet she also made it clear the Commission’s agenda vis-a-vis the issue of gig work is to find some kind of “balance” between (poor) platform work and, er, good and stable (rights protected) employment.

There’s no detail yet on how exactly regional lawmakers plan to square the circle of giving gig platforms a continued pass on not providing good/stable work — given that their sustainability as businesses (still with only theoretical profits, in many cases) is chain-linked to not shelling out for the full suite of employment rights for the thousands of people they rely upon to be engaged in the sweating toil of delivering their service off the corporate payroll.

But that, presumably, is what the Commission’s consultation process is aimed at figuring out. Baked into the first stage of the process is getting the two sides together to try to hash out what better looks like.

“The platform economy is here to stay — new technologies, new sources of knowledge, new forms of work will shape the world in the years ahead,” said Vestager, segueing into a red-line that there must be no reduction in the rights or the social safety net for platform workers (NB: The word ‘should’ is doing rather a lot of heavy lifting here): “And for all of our work on the digital economy, these new opportunities must not come with different rights. Online just as offline, all people should be protected and allowed to work safely and with dignity.”

“The key issue in our consultations is to find a balance between making the most of the opportunities of the platform economy and ensuring that the social rights of people working in it are the same as in the traditional economy,” she also said, adding: “It is also a matter of a fair competition and level playing field between platforms and traditional companies that have higher labour costs because they are subject to traditional labour laws.”

The Commission’s two-stage consultation process on gig work starts with a consultation of “social partners” on “the need and direction of possible EU action to improve the working conditions in platform work”, as it puts it.

This will be open for at least six weeks. It will involve platforms talking with workers (and/or their representatives) to try to come up with agreement on what ‘better’ looks like in the context of platform working conditions, either to steer the direction of any Commission initiative. Or — else — to kick the legislative can down the road on said initiative if they can come up with stuff they can agree to implement themselves.

The second phase — assuming the “social partners” don’t agree on and implement a way forward themselves — is planned to take place before the summer and will focus on “the content of the initiative”, per Vestager. (Aka: what exactly the EU ends up proposing to square the circle that must be squared.)

The competition component of the gig work conundrum — whereby there’s also the ’employer fairness’ dynamic to consider, given platforms aren’t playing by the same rules as traditional employers so are potentially undercutting rivals who are offering those good and stable jobs — explains why the Commission is launching a competition-focused parallel consultation alongside the social stakeholder chats.

“We will soon start a public consultation on this initiative that has another legal base since it is about competition law and not social policies. This is the reason why we consult differently on the two initiatives,” noted Vestager.

She said this will aim to ensure that EU competition rules “do not stand in the way of collective bargaining for those who need it” — suggesting the Commission is hoping that collective bargaining will form some part of the solution to achieving the sought for (precarious) balance of ‘better’ platform work.

Albeit, a cynical person might predict the end goal of all this solicitation of views will probably be some kind of fudge — that offers the perception of a plug for the platform rights gap without actually disrupting the platform economy which Vestager has sworn is here to say.

Uber for one has scented opportunity in the Commission’s talk of improving “legal clarity” for platforms.

The ride-hailing giant put out a white paper last week in which it lobbied lawmakers to deregulate platform work — pushing for a Prop-22 style outcome in Europe, having succeeded in getting a carve out from tightened employment laws in California.

Expect other platforms to follow with similarly self-serving suggestions aimed at encouraging Europe’s social contract to be retooled at the points where it intersects with their business models. (Last week Uber was accused of intentionally stalling on improving conditions for workers in favor of lobbying for deregulation, for example.)

The start of the Commission’s gig work consultation come hard on heels of a landmark ruling by the UK’s Supreme Court (also last week) — which dismissed Uber’s final appeal against a long running employment tribunal.

The judges cemented the view that the group of drivers who sued Uber had indeed been erroneously classified as ‘self employed’, making Uber liable to pay compensation for the rights it should have been funding all along.

So if the EU ends up offering a lower level of employment rights to platform workers vis-a-vis the (post-brexit) UK that would surely make for some uncomfortable faces in Brussels.

While it may be unrealistic to talk about striking a ‘balance’ in the context of business models that are inherently imbalanced, given they’re based on dodging existing employment regulations and disrupting the usual social playbook for profit, he Commission seems to think that a consultation process and a network of overlapping regulations is the way to rein in the worst excesses of the gig economy/big tech more generally.

In a press release about the consultation, it notes that platform work is “developing rapidly” across various business sectors in the region.

“It can offer increased flexibility, job opportunities and additional revenue, including for people who might find it more difficult to enter the traditional labour market,” it writes, starting with some of the positives that are, pesumably, feeding its desire for a ‘balanced’ outcome.

“However, certain types of platform work are also associated with precarious working conditions, reflected in the lack of transparency and predictability of contractual arrangements, health and safety challenges, and insufficient access to social protection. Additional challenges related to platform work include its cross-border dimension and the issue of algorithmic management.”

It also notes the role of the coronavirus pandemic in both accelerating uptake of platform work and increasing concern about the “vulnerable situation” of gig workers — who may have to choose between earning money and risking their health (and the health of other people) via working and thus potential viral exposure.

The Commission reports that around 11% of the EU workforce (some 24 million people) say they have already provided services through a platform.

Vestager said most of these people “only have platform work as a secondary or a marginal source of income” — but added that some three million people do it as a main job.

And just imagine the cost to gig platforms if those three million people had to be put on the payroll in Europe…

In the bit of her speech leading up to her conclusion that platform work is here to stay, Vestager quoted a recent study she said had indicated that 35% to 55% of consumers say they intend to continue to ask for home delivery more in the future.

“We… see that the platform economy is growing rapidly,” she added. “Worldwide, the online labour platform market has grown by 30% over a period of 2 years. This growth is expected to continue and the number of people working through platforms is expected to become more significant in the years ahead.”

“European values are at the heart of our work to shape Europe’s digital future,” she also went on, taking her cue to point to the smorgasbord of digital regulations in the EU’s pipeline — and perhaps illustrating the concept of an overlapping regulatory net that the Commission intends to straightjacket platform giants into more socially acceptable and fair behavior (though it hasn’t yet).

“Our proposals from December for a Digital Services Act and a Digital Markets Act are meant to protect us as consumers if technology poses a risk to fundamental rights. In April we will follow up on our white paper on Artificial Intelligence from last year and our upcoming proposal will also have the aim to protect us as citizens. The fairness aspect and the integration of European values will also be a driver for our upcoming proposal on a digital tax that we plan to present before summer.

“All these initiatives are part of our ambition to balance the great potential that the digital transformation holds for our societies and economies.”

 

#eu, #europe, #gig-economy, #gig-platforms, #labor, #platform-regulations, #policy, #uber

Uber loses gig workers rights challenge in UK Supreme Court

Uber has lost a long running employment tribunal challenge in the UK’s Supreme Court — with the court dismissing the ride-hailing giant’s appeal and reaffirming earlier rulings that drivers who brought the case are workers, not independent contractors.

The case, which dates back to 2016, has major ramifications for Uber’s business model in the UK — and likely regionally, as similar challenges are ongoing in European courts.

European Union lawmakers are also actively eyeing conditions for gig workers, so policymakers were already facing pressure to clarify the law around gig work — today’s ruling only increases that.

The UK Supreme Court judgement can be found here.

We’ve reached out to Uber for comment.

This story is developing… refresh for updates… 

In recent days — and likely in anticipation of this verdict — Uber has kicked off a lobbying effort in Europe calling for deregulation of platform work.

Uber argues that without a carve out from employment laws platforms’ hands are tied over how far they can go to offer workers a better deal.

It says it’s pushing for some of the same ‘principles’ that featured in the Prop 22 ballot initiative which ride-hailing giants Uber and Lyft spend hundreds of millions of dollars pushing in California, going on to win a carve out for delivery and transport work from employment reclassification there last year.

However, responding to Uber’s EU white paper this week, the academic research group, Fairwork, accused it of downplaying its ability to make changes to improve working conditions on its platform.

Instead, it said the tech giant is trying to legitimize a lower level of protection for platform workers than most European workers benefit from — urging lawmakers to focus on expanding and strengthening employment protections, not watering them down.

#employment-law, #europe, #gig-economy, #lawsuit, #platform-regulation, #uber, #workers-rights

Uber lobbies for ‘Prop 22’-style gig work standards in the EU

Uber is shooting its shot at EU lawmakers as they dial up scrutiny of working conditions on gig platforms to decide whether new rules are needed to improve the lot of gig workers.

The ride-hailing and on-demand food delivery giant has published a white paper today in which it lobbies European policymakers for what it couches as a ‘new standard’ for platform work.

In the paper Uber talks of the need to expand some benefits to gig workers — seeking to eschew the nightmare scenario (for Uber) of having to fund the full suite of employment rights if its drivers and riders were reclassified as workers/employees.

It’s also trying to steer policy discussion away from issue of collective bargaining — with the paper floating the notion that app workers need more “meaningful” representation which they say is needed to reflect varying (aka individualized) needs and suggest could be achieved via a variety of channels of ongoing engagement between platform and worker.

Uber’s white paper is framed with the title: ‘A Better Deal’. And the ride-hailing giant is unquestionably after the best possible deal for its business as lawmakers look at whether new laws are needed to ensure a fairer deal for app-based workers.

The question EU lawmakers will need to pay close attention to in the coming months is exactly what kind of deal platforms workers are getting and, as they dig into the detail underlying tech giants’ PR, whether and how to create a legislative framework that improves conditions for armies of ‘contractors’ without undermining the much vaunted European social contract.

Uber has said it will push for a California style ‘Prop 22’ outcome globally — after successfully defeating a law to reclassify gig workers in its own back yard last year.

But the legal and social context is very different in Europe where many platforms have faced litigation on the issue of employment classification and courts have frequently found in workers’ favor.

On Friday Uber faces perhaps its biggest regional court test yet when the UK Supreme Court is expected to hand down its verdict on a long-running challenge by a group of former Uber drivers to its classification of them as self-employed. (The UK is now outside the EU but the outcome of the case is nonetheless likely to influence courts across the region.)

Greater clarification and enforcement of existing employment laws could be a way for policymakers in Europe to clamp down on platform giants that, critics say, have used self-serving classifications of algorithmic micromanagement as a high-tech hack of the legal system to profit at the expense of society (in lost tax revenue) and off of the labor of individual workers deprived of stable employment (and its associated rights).

At the same time, increasing consolidation in the on-demand space is concentrating the power of gig giants. So how can platform workers expect ‘meaningful’ representation or ‘improved’ conditions when a handful of mega platforms are busy closing off the possibility of something better by assimilating the competition — unless there’s a legislative intervention to protect them?

In a blog post accompanying Uber’s white paper today, CEO Dara Khosrowshahi reiterates the tech giant’s preferred ‘new standard’ for gig worker rights should be “grounded in the principles drivers and couriers say are most important to them: Flexibility and control over when and where they want to work, earning a decent wage, access to relevant benefits and protections, and meaningful representation”.

“To make a real difference, reform must also be industry-wide, requiring all platform companies to offer benefits and protections that are standardised across the sector, so that workers are protected no matter which apps they use,” Khosrowshahi goes on.

A universal standard for platform benefits may sound progressive but the notion of ‘relevant’ benefits for gig workers risks fixing this labor force to a floor far below agreed standards for employment — closing off any chance of a better deal for a class of workers who are subject to persistent, algorithmic management.

Such an industry-wide standard may also kill the imperative for gig platforms to compete with each other by offering workers a better deal. So policymakers need to tread carefully to avoid cementing a bad deal for workers they claim they want to help.

Uber’s white paper is pushing for some key principles at this point, rather than delineating a detailed ‘deal’ model for workers — which the company says would need to developed in consultation with stakeholders.

It also says it recognizes that platforms are likely to remain subject to a patchwork of national rules across the EU. And even if the Commission opts to legislate it would be years before such laws take effect — so case law will remain hugely important. But Uber is evidently keen to try to steer any overarching EU guidance which might exert top-down pressure on how Member States approach and apply policy in the area of gig work.

Platform giants have long sought to frame employment classification as a question of ‘flexibility vs benefits’ — claiming workers value flexibility (which they define as meaning ‘the ability to choose when to work’) above all else, even as they apply datafication and tracking to manage individuals’ service delivery via high tech micromanagement of a non-employed labor force.

Thing is: Sure you can log on to such a platform to work ‘when you choose’ but without legal protections such as a mandatory minimum wage there’s no guarantee that gig work ‘flexibility’ will sum to a liveable income for the individual. Which in turn means platform workers may not have defacto flexibility/freedom to choose when and how they work — unless they have other income to rely on.

The platforms are therefore often pushing a paradoxical defence of a business model that critics accuse of being abusive by design — with critical unions dubbing it exploitative and extractive of human labor, accusing platforms of circumventing the social contract and stability offered by traditional employment.

In a section of Uber’s white paper that argues why “employment is not the answer for platform workers” the tech giant points on cue to ‘flexibility’ — saying its model means that “drivers can connect freely to meet that demand or choose a quieter time of day if they wish”. Yet people who need to earn a living may not be able to ‘choose’ a quieter time of day if they’re being paid by the job, since doing so would reduce their earnings, so how much flexibility (or pay decency) does Uber really offer?

(Related: The large sums of money many of these gig giants have spent on trying to accelerate the development of automation technologies; ergo, money they save on not paying employment-linked taxes is being ploughed into trying to replace human workers entirely. So where’s the dignity in that?)

Decision time for the gig economy

In her December 2019 mission letter to the job commissioner, the European Commission president Ursula Von der Leyen tasked the Nicolas Schmit with looking atways to improve the labour conditions of platform workers” — including by ensuring that enforcement of current laws is working — writing that: “Dignified, transparent and predictable working conditions are essential to our economic model.”

Soon after Schmit got his instructions, he sounded a balanced tone on the contentious issue of platform (profits) vs worker (rights), telling Euroactiv that he’s “not against platforms”, and sees them as “part of our new economy” — arguing too that it’s “important for Europe, not to lose the edge with this economy”.

But he also warned that the bloc must not allow high tech tools to be used to embed a new “underprivileged” worker underclass, saying: “We cannot have the economy of the 21st century with working conditions that are more comparable to those in the 19th century.”

Quite how the Commission will square the circle of ‘improving’ precarious platform work in policy terms remains to be seen. But the imperative for it to do good work here has only increased since Von der Leyen issued the instruction: The coronavirus pandemic has shone an excoriating spotlight on the risks — individual and societal — of the lack of a proper social safety net for platform workers, even as on-demand platform work (especially in areas like food and grocery delivery) has been fired up as a side effect of COVID-19.

Uber’s white paper riffs on the theme of the pandemic and the need for platform businesses to ‘go further’ in supporting workers — aka “to ensure independent workers have access to benefits and protections when they need them most”, as it puts it — even as it lobbies against providing all the rights and benefits of employment.

“It makes sense for them to be pushing for a minimum standard of benefits,” says Joe Aiston, senior associate in the employment group at international law firm Taylor Wessing, discussing Uber lobbying for a ‘new standard’ for gig work in the white paper. “As sort of appropriate minimums/protections. And perhaps things which are easier to give without significant disruption to the business model.

“Whereas having to reclassify everyone as employees or as workers would involve quite significant disruption to the business model — and is obviously going to result in significant extra cost for them as a business. Both from the point of view of things like minimum wage and holiday pay, but also the potential knock-on effect from a tax perspective as well.”

And whilst analysis of worker status does not automatically make those people employees for tax purposes,  Aiston says tests are “pretty similar”. Hence litigation over employment classification presents a clear risk to Uber’s tax status — and thus to its (potential) profitability.

On the issue of how to improve gig work, the European Commission has been gathering evidence as it works towards determining how best to proceed — including holding a conference on platform work last September. But big decisions are looming for EU lawmakers this year.

Later this month the Commission will launch a formal consultation of workers’ and employers’ representatives. And Uber’s white paper is clearly targeted at that process so we’re likely to see a number of self-interested attempts to influence platform working condition ‘improvements’ kick off in earnest.

Exactly what will be in play, policy wise, isn’t yet clear. But, last March, the Commission published a 285-page study in which it said the “main” challenges identified vis-a-vis the working conditions of platform workers include: Employment status; information available to the workers about their working conditions; dispute resolution; collective rights and non-discrimination. (So pretty much a full house, then.)

Dig into the actual study and it also discusses low remuneration and insecure income in plenty of detail and as ‘significant stressors’ for platform workers.

Pay certainly looks set to be a significant area of discussion/contention — not least because another of Von der Leyen’s instructions to Schmit asked him to put forward a legal instrument “to ensure that every worker in our Union has a fair minimum wage”.

It’s a common criticism of platform work that earnings may fall below the legal minimum for a worker (as pay by gig jobs typically only generate earnings during a job or on completion of a delivery, not for all the down time spent waiting to score a gig or pick up the goods). So if the EU’s fair minimum wage for ‘every worker’ ends up meaning ‘except platform workers’ that will sum to the Commission rubberstamping a tech-enabled “underprivileged” worker class — just as Schmit said it mustn’t.

Uber’s approach to the issue of pay in its white paper sidesteps the minimum wage issue by talking only of “fair and transparent earnings” (or “decent” pay) for platform workers.

The tech giant also says it’s “ready to lead the industry by advocating for changes to the way platform workers are paid” — though it makes it clear it won’t budge on remuneration without the sought for industry-wide enabling framework (“for flexible earning opportunities, with industry-wide benefits and protections that all platform companies must offer independent workers”).

“This could include universal standards, such as the Proposition 22 legislation recently introduced in California. Or it could be based on a European model of social dialogue, where platform workers, policy-makers and industry representatives work together to set earning principles for the industry,” Uber suggests.

“For example, in Italy the food delivery industry and the General Labour Union signed an agreement confirming the self employed status of couriers while requiring the industry to provide working standards for couriers, including provisions about earnings, injury, third-party insurance and training.”

“Critically, whatever the earning model, it must be based on an industry-wide level playing field to ensure all independent workers have a consistent earnings baseline, whichever platform they choose to work with,” Uber adds.

Clearly, then, the stakes are high all round on this one: For gig workers’ rights; for platform giants’ profits; and for EU lawmakers’ credibility in claiming a socially progressive agenda.

Although it’s not 100% certain the bloc will come with legislation at this point, either. A Commission spokeswoman suggested policymaking could be off the table if platforms and workers can come to a consensus agreement over what ‘better’ precarious work looks like. (But, yeah, good luck with that.)

The formal consultation of “social partners” that’s set to kick off later this month will consist of two stages, per the Commission spokeswoman.

“The first stage seeks their views on the need of a possible EU initiative to improve the working conditions of people working through platforms. In the second stage, they will be consulted on the possible content of such an initiative,” she said, noting that the Commission will “carefully assess social partners’ replies”.

“Provided social partners do not decide to negotiate an agreement among themselves, the Commission intends to put forward a legislative initiative by the end of 2021,” she added.

The spokeswoman confirmed that the policy areas where challenges had been identified — and where “improvements may be needed” — include “precarious working conditions, transparency and predictability of contractual arrangements, health and safety challenges and adequate access to social protection”.

Asked to confirm whether ‘precarious working conditions’ includes low and unstable renumeration she declined to specify, saying: “I’m afraid the [aforementioned list] is as far as we can go regarding the initiative at this stage.”

Employment status

Among a number of policy considerations summarized at the end of the Commission-instigated study into gig worker conditions is the statement that employment status remains a core challenge.

“Some platforms seem to operate at the margins between self-employed and employee, adjusting practices to maximise control over platform workers without unequivocally assuming the role of employers,” the report observes, noting the discrepancy between the (plodding) pace of case law clarifying where the employment classification line lies and the “fast-changing business practices characterising platform work”.

“Unless Member States widen the concept of employee or introduce a rebuttable presumption on the employment status of platform workers [through legislation or case law], platforms are likely to continue or expand their reliance on labour from self-employed individuals,” it continues.

“Reclassification of individual cases may happen on the basis of EU law or on national legislation, but it is unlikely that this will drastically reverse the main trend.”

“Actions aimed at protecting self-employed platform workers who are economically dependent on the platforms to ensure some minimum standards as to their ‘working conditions’ seem advisable,” the report also adds — while an associated ‘policy implication’ suggests that the EU and Member States “should consider clarifying which platform practices are incompatible with self-employment for platform workers”.

Clarification of self-employment tests — or of practices that should fail the test — is one way for pan-EU policymakers to move. Though, again, it remains to be seen which ideas the Commission will choose to champion as it takes more feedback on the gig economy.

On the employment classification case law front, a major decision is looming in the UK in relation to Uber’s ride-hailing business. A 2016 employment tribunal challenge to Uber’s classification drivers as self employed is headed for a final judgement on Friday — when the UK Supreme Court is expected to deliver its verdict on a case that has seen Uber lose a number of appeals over the last five years.

The Supreme Court ruling will likely have ramifications for the ~45,000 drivers who Uber says operate on its platform in London — and likely more widely across the UK.

It could also ripple out beyond that, given the active attention now being paid to improving the lot of gig workers by EU policymakers.

Last year a French court of last resort ruled that a former Uber driver should have been considered an employee instead of a self-employed partner.  It found there was a relationship of subordination between the company and the driver — flagging issues such as the inability of drivers to set prices; build their own customer base; or choose how to execute a task. “The driver participates in a managed transportation service and Uber unilaterally defines the operating terms,” it wrote.

However Uber denied the case set a precedent while also claiming to have made a number of changes to how its platform operates since the challenge was lodged in 2017 — suggesting drivers have been given more control over how they use Uber and now have greater “stronger social protections” (such as free accident insurance).

The case underlines the difficulties of relying on complaint-based case law to shape coherent outcomes for platform workers, plural.

The length of time such challenges take to reach a final outcome also give the platforms plenty of time to reconfigure their operations so they can at least try to claim specific findings no longer apply.

So legislation may indeed be required to lock in improvements for the conditions of gig workers.

“It’s true to say that things can change — so if Uber, following [the Supreme Court] decision materially change how the business model works then it’s possible they could then bring the drivers outside of the definition again,” says Aiston, although he points out the required changes in that context may, as it turns out, not be “acceptable” to Uber.

“We’ll have to wait to see what the variables the Supreme Court decides push it one way or the other but they would have to make a determination as to whether it works in the context of their business model to make such potentially significant changes to how things work,” he goes on, adding: “I suspect that they may already have been putting in place changes to how the business model works — perhaps to prepare for the judgement.

“So I guess the point there is the case law is so context-specific that that’s an argument to say that actually legislation and specific definitions are key rather than perhaps relying on very specific case law.”

The Commission’s study does also notes a number of challenges holding back policymaking in this area — even things as basic as clearly defining platform work; or gathering sufficiently comprehensive data to inform evidence-based policymaking.

“Once someone is classified as a worker, rather than an independent contractor, then that does potentially increased their ability and right to collectively bargain — so it’s another potential knock on effect should the Supreme Court decision go against Uber,” adds Aiston. “It might lead to the potential for a greater ability for their drivers/riders to collectively bargain so that will be something the relevant unions are looking out for keenly as well.”

Attempts to regulate and legislate are, meanwhile, in train in Europe at a national level. Such as in Spain where the government has sought for several years to crack down on platforms using so called ‘falsos autonomos‘ (aka falsely self-employed workers), and is in the process of reforming labor laws to reflect and capture platform work.

That national labor reform process could result in platforms being required to hire delivery workers, per recent reports — and such moves give platform giants added incentive to lobby the Commission for ‘more flexible’ pan-EU rules which may at least limit how far national law can travel to influence rules on the grounds elsewhere in the bloc (so limit potential damage to their business model).

The UK government has also suggested legislation is coming. It conducted a major review of modern working practices back in 2017 — which included looking at gig work. And among the Taylor Review’s recommendations was that the current (UK) legal classification of ‘worker’ should be updated to better reflect gig work — with the report suggesting ‘dependent contractor’ would be a more appropriate framing now — and also that greater focus should be paid to the control exercised over workers by platforms.

The review led to a government plan to bolster worker rights, as it was billed with much fanfare. However the ‘Good Work Plan’ reform package unveiled at the end of 2018 was instantly dismissed as weak and lacking substance by labor unions (vs the government trumpeting it as a massive expansion of workers rights). Not does it seem to have done much to address gig work specifically, as yet.

A commitment by the UK government as part of that plan in 2018 by the UK government to legislate to improve the clarity of employment status tests — in order to “reflect the reality of the modern working relationships” — has not amounted to anything yet.

The planned legislation may have been delayed as result of the pandemic. Aiston suggests it’s also possible the government is waiting for the Supreme Court judgement in the Uber tribunal case to inform its policy thinking. So for all Uber’s slick regional PR push to influence policymaking, it may have relatively little say in the matter vs European case law and the court of public opinion.

“If the Supreme Court judgement does against [Uber] in the sense that the drivers were workers I think that’s probably going to make things at least a bit more difficult for them. Because in the UK at least they’re going to have decide that well either we accept that all drivers are workers or — depending on reasons given for the judgement — can we adjust our business model to bring it away from that analysis,” says Aiston.

“They may be keen to do the latter, on the basis that they are obviously keen to keep people being self-employed rather than workers but I guess from a PR perspective that might not look great for them to do that. Once a judgement has been made that they are workers, one view is that you just need to accept that now and move on and acknowledge that they have those rights.”

He points to examples of gig economy companies trying to ‘pre-empt or negate’ the risk of reclassification of ‘self-employed’ contractors as workers by putting in place benefits packages — such as Uber offering free or low cost insurances to drivers and riders in Europe — “to show that they are a ‘good’ company and they want to look after people”.

Such efforts fall short of the suite of rights reclassified platform workers could get so there’s more movement that could happen here — and may have to in order to keep the travelling public on side.

“They tend not to go to the extreme and say well we’ll acknowledge that they’re workers and therefore they’re entitled to minimum wage and their rest breaks and that kind of thing. So it’s something to look out for as well with these gig economy businesses,” Aiston suggests. “I think it will become more competitive from that perspective.

“Whether or not they acknowledge that people are workers is one thing but I think you can see a definite move towards gig economy businesses realizing that they have a duty to look after people… Obviously that serves a dual purpose of people getting some benefits but also it being a positive thing from a PR perspective and the point of view of the public view of these companies.”

It’s also worth noting that UK employment law is more nuanced than some national employment law — as it does already recognize the concept of a ‘worker’ (i.e, not an employee and not self-employed) — while Aiston notes some other European countries (and also the US) have a more limited set of classifications (i.e. employed vs self employed).

“European courts will look to things like the Supreme Court decision in the UK. And whilst they’re not bound by that decision you can imagine that the way that this swings will have at least some kind of knock-on effect to how any similar judgements are taken across Europe,” he suggests. “The interesting thing to bear in mind is that in the UK we have this middle classification of a worker. Whereas in most European countries you’re either self employed, a contractor or an employee. So there’s a bigger dichotomy elsewhere in Europe.”

“In a way the UK’s in a better position because we have this middle ground. And some people might say that has made the UK courts be in a position more easily to reclassify — assuming that the Supreme Court goes the same was as the court of appeal did [in the Uber employment tribunal case], which was to state that these drivers were in fact workers. So it’s important to note there’s a difference there,” he adds.

“In the UK you can understand why it has perhaps been a bit more easy for a court to make a decision that the driver should fit within this middle category where they attract some protections but not all of them.”

If EU policymakers were to decide to create a pan-EU standard akin to ‘worker’ that would present a huge opportunity/risk for Uber et al — with the chance to influence key parameters in their interests as a means of reducing the threat employment litigation poses to their core business model (and staving off a larger tax bill).

Though there will clearly be costs involved in an expansion of the level of protection offered to gig workers. The question for tech giants would be how much they can shrink those costs — aka what’s the bare minimum in ‘relevant’ standards they can sell across Europe?

Alternatively, EU lawmakers could seek to stipulate and enforce a list of ‘dos and don’ts’ for platforms vis-a-vis workers — as a way to establish appropriately ‘fair’ operational employment limits — which in turn might have the potential to be disruptive to the business model of on-demand giants whose profits (often still theoretical at this point) depend on access to plentiful, low cost labor supplied by lots of people they claim not to employ.

Setting a list of specific operational requirements for platforms is exactly what the Commission has proposed in an overarching platform regulation that EU lawmakers set out in December (the Digital Markets Act) — in that case aimed at intermediating platforms which have the most market power to push for fair dealing with other businesses (and foster digital competition).

Something similar for gig platforms that aims to ensure a fair deal for workers is at least conceivable.

It would surely be preferable to Uber et al vs being legally required to put hundreds of thousands of on-demand workers on the payroll. But it would also put an end to the free ride these giants used to scale in the first place.

So it may not be the end of the road for the platform economy in Europe but a period of considerable adjustable looks inevitable — and business models will need to adapt to changing (and/or better enforced) employment laws.

Aiston says organisations will have to weigh up the pros and cons of adjusting their business models — with a view to either seeking to keep arrangements away from employee or worker status (but potentially reducing how much control they can apply, e.g. over price); or to accept people are workers and adapt the business model and pricing structure accordingly (such as by, say, restricting the ability to work for rival platforms).

#eu, #europe, #gig-economy, #platform-regulation, #policy, #tc, #uber

Carjackings are up—and gig workers are getting victimized

A DoorDash Inc. delivery person arranges an order in the back of a vehicle outside of a DoorDash Kitchens location in Redwood City, California.

Enlarge / A DoorDash Inc. delivery person arranges an order in the back of a vehicle outside of a DoorDash Kitchens location in Redwood City, California. (credit: Bloomberg | Getty Images)

A DoorDash driver named Jeffrey Fang was returning to his minivan in San Francisco after completing a delivery last week when he noticed a stranger in his car. After a struggle, he told a local news outlet, another person, an accomplice, got behind the wheel and drove away. Fang’s children, 4 and 1, were still buckled inside.

Four hours later, after a frantic search by neighbors and law enforcement, the minivan was found in another San Francisco neighborhood, with the children safe and unhurt inside.

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#carjacking, #door-dash, #food-delivery, #gig-economy, #policy, #uber-eats

The future of SaaS is on-demand: Use experts to drive growth and engagement

For SaaS companies, not having a gig economy strategy as we start 2021 is like missing the internet trend in 1990 or failing to get ahead of the mobile revolution in 2010.

Leading SaaS are now using on-demand experts to revolutionize the customer experience. They’re growing revenue and post-sales retention and even using the insights to build better products. According to Staffing Industry Analysts (SIA), the global gig economy is approaching $5 trillion as project-based staffing continues this digital transformation.

SaaS superstars like Amazon AWS and Qualtrics have been investing in on-demand expertise for years, and in 2019, market research firm Million Insights published a market report that predicted tech services will be a trillion dollar market by 2025. Much of this growth boils down to some simple facts about the increasingly emotional act of consumption.

A 2013 Gallup report found that customers who had a strong attachment to a brand spend a full 23% more than an average customer of the same brand.

By bringing human experts into their software solutions, companies can engage with their customers to solve problems more efficiently and in a more personalized manner.

Conversely, more than eight in 10 executives interviewed in a 2015 report from The Economist Intelligence Unit believed their companies lose sales each year because of a failure to engage properly with the customer.

By bringing human experts into their software solutions, companies can engage with their customers to solve problems more efficiently and in a more personalized manner while simultaneously gathering important insights about how to make their products more intuitive.

It’s a win-win for both sides, but it involves putting aside the notion that new product features will solve your customers’ every need. They won’t. In fact, more than 80% of new product features are never used.

The world’s SaaS leaders are well onboard the gig economy train. Need some help drafting that big companywide memo? Hire a Grammarly Expert to help you mind your p’s and q’s. Does filing your tax return give you anxiety? TurboTax Live is here to the rescue with actual on-demand CPAs to review your return before you turn it in.

Don’t have the time to Google “How to build a website” 100 times as you patch together something subpar? Simplify the entire process by joining GoDaddy Pro and be connected with the perfect WordPress designer or developer to craft the site of your dreams.

Software companies race to release new products and features because they want to provide the very best technologies to their customers and edge out the competition. Yet no matter how well-intended their decisions, too many SaaS features fail to drive real customer engagement. Why? Because no matter how advanced the software is, it can only do so much.

And when it comes to understanding and solving the customer’s problem, too often the new features simply aren’t enough.

There are four core drivers for why on-demand experts are a critical requirement for any business:

Need for increased customer retention

In today’s time-starved world, most of your customers are not able to learn and understand the full capabilities of your offering on their own. In fact, most of your customers are using less than 20%, and possibly as little as 5% of your feature set. Their underutilization directly impacts the retention and growth of your service, because customers don’t value capabilities they don’t use or even know about. From a financial perspective, the ROI of retention cannot be overstated. The Harvard Business Review reported that a mere 5% increase in retention can increase profits between 25% and 95%.

#ai, #cloud, #column, #ec-cloud-and-enterprise-infrastructure, #ec-column, #gig-economy, #machine-learning, #on-demand, #saas

Joe Biden’s new gig

After serving as Obama-Biden campaign manager and White House Deputy Chief of Staff and now living in San Francisco and working with the tech sector, I am hopeful about the Biden-Harris administration’s ability to put in place smart policies and regulatory stability to further unleash the industry’s vast potential — not to mention the effect their calm and measured leadership could have on our greater economy.

However, with new leadership comes new perspectives on many of the most critical issues facing Silicon Valley. While the bonds between the innovation economy and the Obama-Biden Administration resulted in national prosperity, the tech sector is now intertwined in nearly every facet of American life.

The resulting tension means the new Administration will take its role as regulator seriously and investors and businesses alike should not overlook how quickly President Biden will move on policy – especially as it relates to the future of work and getting the U.S. economy back on track.

There’s no question the gig companies had a banner year in 2020. Even with ride-hailing usage down dramatically, the strength of meal, grocery and just about everything else delivered combined with the victory in California of Proposition 22 has driven up market caps and positioned many startups for going public. Yet, while the West Coast may be feeling emboldened, the Beltway has another trajectory in mind.

Congress has been working on gig worker classification legislation named the PRO Act for months. The bill closely mirrors the maligned California Assembly Bill 5 that Proposition 22 mostly reversed. It’s broadly supported by labor and could see some traction this year. Labor is already working hard to line up support from the various Congressional coalitions, and at the same time gig economy companies are gearing up to fight it with their unlimited resources.

The question is – what will President Biden do? Long ago he voiced his support for AB 5 and laid out plans to solve worker misclassification during the campaign, but he’s also hiring and appointing staff to the Administration deeply experienced in tech. President Biden has been governing longer than most startup founders have been alive, he’s a master at understanding forces in Washington and how to reach a compromise. He knows that what’s rarely discussed during legislative debate is how the law will actually be implemented.

We shouldn’t be surprised if the Biden Administration convenes the Department of Labor and the industry to determine how companies actually enact worker protections.

Despite most bills being thousands of pages, they’re rarely prescriptive. Those details are left up to agencies. President Biden has oversight of the Department of Labor, which, if the PRO Act is passed, will be responsible for its implementation.

We shouldn’t be surprised if the Biden Administration convenes the Department of Labor and the industry to determine how companies actually enact worker protections. President Biden’s nominee for Labor Secretary, Boston Mayor Marty Walsh, while a staunch supporter of labor, is also well regarded by the business sector as someone they can work with and reach a compromise.

We just have to look to the states to understand why this outcome is so plausible. The gig companies already have Proposition 22 type campaigns underway in six states and are running legislation in a half dozen more. By the end of 2021 there will be law on the books codifying worker protections in nearly a third of the country, modeled on Proposition 22.

This kind of momentum is hard to ignore and labor knows it. Although labor is aligned in its support of the PRO Act, the alignment becomes blurry when considering state action. For example, many northeastern states have had a thriving black car and taxi industry for decades.

This means Labor’s position on gig laws in New York and New Jersey are quite different than places like Washington State or Illinois where gig workers are still relatively new and the ink is drying on regulations supported by Uber and Lyft just a few years ago. Labor is aligned as much as they can be and enough to support the PRO Act, but there isn’t a national movement and that leaves room for compromise.

This is all good news for the tech sector. It’s a fantasy to think that regulation wouldn’t eventually come to protect the very workers who power the gig economy. And that’s a good thing – tech has a moral responsibility to do right by its workers. However, those regulations shouldn’t and won’t be imposed on tech. Rather it will take weeks and months of campaigns and bills winding their way through the states and Congress, culminating with negotiations and compromises.

Or maybe even years of renewed regulatory processes. All of which will be overseen by a new President who has witnessed first-hand over his career how innovation can help the nation grow and recover.

After four years of Trump’s stubborn denialism, magic thinking and economic harm, Biden will promote policy rigor, public spiritedness and private sector ingenuity to work together for innovative solutions. It will be hard work and I promise you it won’t be pretty, but we should expect the dawn of a new era of U.S. tech-driven dynamism.

#column, #gig-economy, #labor, #opinion, #policy, #pro-act, #prop-22, #ride-hailing, #transportation

Grubhub gig workers react angrily to change in tipping policy

Grubhub gig workers react angrily to change in tipping policy

Enlarge (credit: Brett_Hondow | Getty Images)

California-based workers for food delivery app Grubhub have reacted angrily to changes to the platform which they say discourage tipping, saying they would wipe out the supposed benefits of new gig worker rules in the state.

Last month, California passed Proposition 22, which though falling far short of the benefits received by full-time employees, gave gig workers a limited number.

Weeks after the ruling, Grubhub reduced its default tip amount from about 20 percent to zero, adding a suggestion to “leave an optional tip on top of driver benefits.”

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#gig-economy, #grubhub, #policy, #workers-rights

An even bigger battle for gig worker rights is on the horizon

When California voters passed Proposition 22 with 58.6% of the vote, they agreed with Uber, Lyft, DoorDash, Instacart and Postmates that gig workers should not be employees who are entitled to myriad labor rights. The proposition they passed stated that gig workers should be independent contractors who receive the limited benefits proposed by those companies.

“The first feeling I had was shock, disbelief and hurt,” Vanessa Bain, a worker-organizer with Gig Workers Collective, told TechCrunch. “It didn’t feel good to think that my fellow Californians voted to strip people like myself and my co-workers of our labor rights.”

But Prop 22 does not mark the end of the battle of the status of gig workers. Gig workers, lawyers and activists affiliated with Gig Workers Rising, Gig Workers Collective, the National Employment Law Project and the Working Partnerships for Families are all gearing up to redouble their efforts in the New Year. But the same goes for gig companies. Uber and Lyft are ready to take legislation similar to Prop 22 into other parts of the country and the world.

In the year ahead, we will likely see lobbying efforts from both gig companies and gig worker organizations alike, as well as more lawsuits.

“We didn’t have time for more grieving because as soon as it passed, every company signaled they’re looking to expand this model to the national level, which means our organizing needs to adjust accordingly,” Bain said.

So, really, the fight has just begun. In the year ahead, we will likely see lobbying efforts from both gig companies and gig worker organizations alike, as well as more lawsuits.


In 2019, the California state legislature passed Assembly Bill 5, which became law in January 2020.

AB 5 mandated that companies apply the ABC test to determine how to classify their workers. According to the ABC test, in order for a hiring entity to legally classify a worker as an independent contractor, it must prove the worker:

  • A — is free from the control and direction of the hiring entity.
  • B — performs work outside the scope of the entity’s business, and
  • C — is regularly engaged in an “independently established trade, occupation or business of the same nature as the work performed.”

Many have argued that gig economy companies do not pass the ABC test, while the companies themselves have, of course, argued that they do. As AB 5 made its way through the state legislature, gig companies banded together with their competitors to fight a collective enemy: labor rights for their respective workforces.

In August 2019, Uber and Lyft kicked off that fight with an initial $60 million put toward the ballot measure now known as Prop 22. Between August 2019 and November 2020, that number skyrocketed to around $205 million and brought in contributions from other companies like Postmates (now owned by Uber), Instacart and DoorDash. All that funding makes Proposition 22 the most expensive ballot measure in California since 1999.

Uber driver Sergei Fyodorov discusses why he supports a yes vote on Proposition 22 in Oakland, California on October 9, 2020. Image Credits: JOSH EDELSON/AFP via Getty Images

On the other side, major donors in opposition of Prop 22 included Service Employees International Union, United Food & Commercial Workers and International Brotherhood of Teamsters. They collectively contributed $15.9 million.

The ballot measure, which goes into effect this month, implements a few key benefits:

  • An earnings guarantee of at least 120% of minimum wage while on the job.
  • 30 cents per engaged mile for expenses.
  • A healthcare stipend.
  • Occupational accident insurance for on-the-job injuries.
  • Automobile accident and liability insurance.

Ahead of the Prop 22 vote, Cherri Murphy, a ride-share driver for Uber and Lyft and lead organizer at Gig Workers Rising, was heavily involved in Gig Workers Rising’s efforts to combat the millions of dollars tech companies put into ensuring gig workers would be classified as independent contractors.

“We had a hell of a fight,” Murphy told TechCrunch. “We were up against a $205 million campaign but I still had to believe that we could win.”

#gig-economy, #gig-workers, #labor, #prop-22, #ride-hailing, #tc

Why are telehealth companies treating healthcare like the gig economy?

Telehealth has taken off.

Spurred by the pandemic, many doctors in the U.S. now offer online appointments, and many patients are familiar with getting live medical advice over the internet. Given the obvious benefits, many experts have concluded that telehealth is here to stay. “It’s taken this crisis to push us to a new frontier,” said Seema Verma, administrator of the Center for Medicare and Medicaid Services. “But there’s absolutely no going back.”

Now the question is, where are we going? Telehealth has played an essential role during the pandemic, and it could do even more good in the years to come. But we are still in the very early days of its development. And if we are to realize telehealth’s full potential, then we must first reckon with the fact that there are serious flaws in the predominant way it is delivered today — flaws that endanger patients themselves.

Legacy telehealth services like Teladoc and others were built for a time when telehealth was a fringe phenomenon, mostly used to support acute needs like a bad cold or a troubling rash. They largely offer, in effect, randomized triage care. Patients go online, wait in a queue and see the first doctor who happens to be available. These companies market this as a virtual house call, but for patients, the experience may feel more like being stuck on a conveyor belt. Too often, they get funneled through the system with little to no choice along the way.

Insurance companies love this model because it is cheap to operate. But patients bear the cost. Doctors, in this arrangement, get paid to work the assembly line. Every minute they spend listening to patients — learning about their lives, building a personal relationship — is a minute they’re not moving them down the line, seeing the next patient and earning their next fee. The system doesn’t reward doctors for providing care; it rewards them for churning through patients.

As we build telehealth’s future, doubling down on this model would be a worrisome mistake since it is antithetical to how our healthcare system should operate. Healthcare has long been premised on the idea that you should have an ongoing relationship with a local care provider — someone with a holistic, longitudinal view of your health, who you trust to help navigate difficult or sensitive medical issues.

The randomized triage model breaks this bond and replaces it with a series of impersonal interactions that feel more like ones you have with an Uber driver — polite but transactional, brief and ephemeral. Healthcare, however, should not be treated in the same way as the gig economy.

As a physician, I am troubled by the prospect of what happens when you scale this model up. Every time a patient gets passed from one doctor to the next, there is a chance that critical information is lost. They won’t understand your baseline mood, your family context or living situation — all critical “intangibles” for informed treatment. That lack of longitudinal data leads to worse outcomes. This is why the healthcare system has long been designed to minimize patient handoffs — and why it would be a mistake for us to choose a telehealth infrastructure that increases them.

What, then, does a better approach look like?

We are at the very dawn of telehealth’s integration into our country’s healthcare system, and I won’t claim to know the full answer. But I do know that patients are far better stewards of their own health than a random doctor generator. A more effective approach to telehealth puts the power in patients’ hands. Because when we give them choices and then listen to them, patients tell us what they prefer.

Data gathered by my company makes clear that by a substantial margin, people want to make this decision themselves: Nine out of 10 telehealth patients prefer to schedule an appointment with a provider of their choosing rather than see a randomly assigned doctor after waiting in a digital queue.

Not only that: When given this choice, most patients — about seven in 10 — make an appointment with a nearby doctor when booking a virtual visit. Patients instinctively know that at some point, they’ll want or need to physically be in the same room with their doctor. And they know that choosing a local provider makes it possible to pick up the conversation in-person right where it left off online. They don’t want to be forced to choose between telehealth and an ongoing relationship with a trusted provider. And they’re right — they shouldn’t have to.

None of the legacy telehealth companies focus on this imperative. Instead, while the pandemic rages on, they are rushing to scale while their randomized triage model is still viable. And the markets may reward them in the near term for being in the right place at the right time. But long-term value will be derived from listening to, responding to and iterating on what patients want.

Experience suggests patients will reward whoever can give them the most control over their healthcare. That’s where I’m placing my bet, too.

#column, #gig-economy, #health, #healthcare, #opinion, #physician, #startups, #telecommunications, #telehealth, #telemedicine

Uber and Lyft in driving seat to remake US labor laws

Uber signs are seen August 20, 2020 at Los Angeles International Airport in Los Angeles, California. - Rideshare service rivals Uber and Lyft were given a temporary reprieve on August 20 from having to reclassify drivers as employees in their home state of California by August 21. (Photo by Robyn Beck / AFP) (Photo by ROBYN BECK/AFP via Getty Images)

Enlarge / Uber signs are seen August 20, 2020 at Los Angeles International Airport in Los Angeles, California. – Rideshare service rivals Uber and Lyft were given a temporary reprieve on August 20 from having to reclassify drivers as employees in their home state of California by August 21. (Photo by Robyn Beck / AFP) (Photo by ROBYN BECK/AFP via Getty Images) (credit: Robyn Beck | Getty Images)

California voters’ decision to let Uber and other gig-economy companies continue to treat their workers as independent contractors has dealt a crushing blow to campaigners and legislators and paved the way for the companies to remake labor laws across the US.

Voters in the state overwhelmingly approved Proposition 22 on Tuesday, exempting the companies from a new employment law passed last year. As a result, drivers in the state will not be classed as employees but can draw upon limited healthcare provisions and will earn a minimum rate of pay.

The victory paves the way for similar legislation to be put in place across the US where, according to research from the investment bank Cowen, as many as 17 states are considering how to regulate the gig economy.

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#gig-economy, #lyft, #policy, #rideshare, #uber

Teachers are leaving schools. Will they come to startups next?

It wasn’t the lingering exhaustion that made Christine Huang, a New York public school teacher, leave the profession. Or the low pay. Or the fact that she rarely had time to spend with her kids after the school day due to workload demands.

Instead, Huang left teaching after seven years because of how New York City handled the coronavirus pandemic in schools.

“Honestly, I have no confidence in the city,” she says. Tensions between educators and NYC officials grew over the past few weeks, as school openings were delayed twice and staffing shortages continue. In late September, the union representing NYC’s principals called on the state to take control of the situation, slamming Mayor de Blasio for his inability to offer clear guidance.

Now, schools are open and the number of positive coronavirus cases are surprisingly low. Still, Huang says there’s a lack of grace given to teachers in this time.

Huang wanted the flexibility to work from home to take care of her kids who could no longer get daycare. But her school said that, while kids have the choice on whether or not to come into class, teachers do not. She gave her notice days later.

There are more than 3 million public school teachers in the United States. Over the years, thousands have left the system due to low pay and rigid hours. But the coronavirus is a different kind of stress test. As schools seesaw between open and closed, some teachers are left without direction, feeling undervalued and underutilized. The confusion could usher numbers of other teachers out of the field, and massively change the teacher economy as we know it.

Teacher departures are a loss for public schools, but an opportunity for startups racing to win a share of the changing teacher economy. Companies don’t have the same pressures as entire school districts, and thus are able to give teachers a way to teach on more flexible hours. As for salaries, edtech benefits from going directly to consumers, making money less of a budget challenge and more of a sell to parents’ wallets.

There’s Outschool, which allows teachers to lead small-group classes on subjects such as algebra, beginner reading or even mindfulness for kids; Varsity Tutor, which connects educators to K-12 students in need of extra help; and companies such as Swing and Prisma that focus on pod-based learning taught by teachers.

The startups all have different versions of the same pitch: they can offer teachers more money, and flexibility, than the status quo.

Underpaid and overworked teachers

There’s a large geographic discrepancy in pay among teachers. Salaries are decided on a state-by-state and district-by-district level. According to the National Center for Education Statistics, a teacher who works in Mississippi makes an average of $45,574 annually, while a teacher in New York makes an average of $82,282 annually.

Although cost of living factors impacts teacher salaries like any other profession, data shows that teachers are underpaid as a profession. According to a study from the Economic Policy Institute, teachers earn 19% less than similarly skilled and educated professionals. A 2018 study by the Department of Education shows that full-time public school teachers are earning less on average, in inflation-adjusted dollars, than they earned in 1990.

The variance of salaries among teachers means that there’s room, and a need, for rebalancing. Startups, looking to get a slice of the teacher economy, suddenly can form an entire pitch around these discrepancies. What if a company can help a Mississippi teacher make a wage similar to a New York teacher?

light bulb flickering on and off

Image: Bryce Durbin / TechCrunch

Reach Capital is a venture capital firm whose partners invest in education technology companies. Jennifer Carolan, co-founder of the firm, who also worked in the Chicago Public School system for years, sees coronavirus as an accelerator, not a trigger, for the departure of teachers.

“We have a system and education system where teachers are underpaid, overworked, and you don’t have the flexibility that has become so important for workers now,” she said. “All these things have caused teachers to seek opportunity outside of the traditional schooling system.”

Carolan, who penned an op-ed about teachers leaving the public school system, says that new pathways for teachers are emerging out of the homeschooling tech sector. One of her investments, Outschool, has helped teachers earn tens of millions this year alone, as the total addressable market for what it means to be “homeschooled” changed overnight.

Gig economy powered by startups

Education technology services have created a teacher gig economy over the past few years. Learning platforms, with unprecedented demand, must attract teachers to their service with one of two deal sweeteners: higher wages or more flexible hours.

Outschool is a platform that sells small-group classes led by teachers on a large expanse of topics, from Taylor Swift Spanish class to engineering lessons through Lego challenges. In the past year, teachers on Outschool have made more than $40 million in aggregate, up from $4 million in total earnings the year prior.

CEO Amir Nathoo estimates that teachers are able to make between $40 to $60 per hour, up from an average of $30 per hour in earnings in traditional public schools. Outschool itself has surged over 2,000% in new bookings, and recently turned its first profit.

Outschool makes more money if teachers join the platform full-time: teachers pocket 70% of the price they set for classes, while Outschool gets the other 30% of income. But, Nathoo views the platform as more of a supplement to traditional education. Instead of scaling revenue by convincing teachers to come on full-time, the CEO is growing by adding more part-time teachers to the platform.

The company has added 10,000 vetted teachers to its platform, up from 1,000 in March.

Outschool competitor Varsity Tutors is taking a different approach entirely, focusing less on hyperscaling its teacher base and more on slow, gradual growth. In August, Varsity Tutors launched a homeschooling offering meant to replace traditional school. It onboarded 120 full-time educators, who came from public schools and charter schools, with competitive salaries. It has no specific plans to hire more full-time teachers.

Brian Galvin, chief academic officer at Varsity Tutors, said that teachers came seeking more flexibility in hours. On the platform, teachers instruct for five to six hours per day, in blocks that they choose, and can build schedules around caregiver obligations or other jobs.

Varsity Tutors’ strategy is one version of pod-based learning, which gained traction a few months ago as an alternative to traditional schooling. Swing Education, a startup that used to help schools hire substitute teachers, pivoted to help connect those same teachers to full-time pod gigs. Prisma is another alternative school that trains former educators, from public and private schools, to become learning coaches.

Pod-based learning, which can in some cases cost thousands a week, was popular among wealthy families and even led to bidding wars for best teacher talent. It also was met with criticism, suggesting the product wasn’t built with most students in mind.

The reality of next job

A tech-savvy future where students can learn through the touch of a button, and where teachers can rack in higher earnings, is edtech’s goal. But that path is not accessible for all.

Some tutoring startups could create a digital divide among students who can pay for software and those who can’t. If teachers leave public schools, low-income students are left behind and high-income students are able to pay their way into supplemental learning.

Still, some don’t think it’s the job of public school teachers, the vast majority of which are female, to work for a broken system. In fact, some say that the whole concept of villainizing public school teachers for leaving the system comes with ingrained sexism that women have to settle for less. In this framework, startups are both a bridge to a better future for teachers and a symptom of failures from the public educational systems.

Huang, now on the job hunt, says that the opportunities that edtech companies are creating aren’t built for traditional teachers, even though they’re billed as such. So far, she has applied to curriculum design jobs at educational content website BrainPop, digital learning platform Newsela, math program company Zearn and Q&A content host Mystery.org.

“What I’m finding is that a lot of edtech companies don’t seem to value our skills as teachers,” she said. “They’re not looking for teachers, they’re looking for coders.”

Edtech has been forced to meet increasing demand for services in a relatively short time. But the scalability could inherently clash with what teachers came to the profession to do. Suddenly, their work becomes optimized for venture-scale returns, not general education. Huang feels the tension in her job interviews, where she feels like recruiters don’t pay attention to creativity, knowledge and human skills needed for managing students. She has created 30 different versions of her resume.

The lack of suitable jobs made Huang decide to go on childcare leave instead of quitting the education system entirely, in case she needs to return to the traditional field. She hopes that is not the case, but isn’t optimistic just yet.

“I haven’t gotten a whole lot of interviews, because people see my resume; they see that I’m a teacher, and they automatically write me off,” she said.

Image Credits: Bryce Durbin (opens in a new window)

#amir-nathoo, #coronavirus, #covid-19, #education, #gig-economy, #learning-pods, #outschool, #startups, #tc, #teacher-economy, #teachers

Tech must radically rethink how it treats independent contractors

Despite a surging stock market and many major tech players having record quarters, we’re still seeing layoffs throughout tech and the rest of corporate America. Salesforce recorded a huge quarter, passing $5 billion in revenue, only to lay off around 1000 people. LinkedIn is laying off 960 people one day after reporting a 10% increase in revenue.

These layoffs may seem like a contraction in size for these huge enterprises, but it’s actually the beginning of something I call The Great Unbundling of Corporate America. They still need to grow, they still need to innovate, they still need to get work done and they’re not simply canceling projects and giving up on contracts.

Just as COVID-19 has accelerated the move to remote work, our current crisis has accelerated the trend toward hiring independent contractors. Back in 2019 a New York Times report found that Google had a shadow workforce of 121,000 temporary workers and contractors, overshadowing their 102,000 full-timers. ZipRecruiter reported in 2018 that tech, along with its record employment growth, was showing an increasing share of listings for independent contractors.

A study from the Bureau of Labor Statistics found that between 6.9% and 9.6% of all workers are now independent contractors, and according to Upwork, that may be as high as 35%. Mark my words — companies are using this time as an opportunity to swing the pendulum toward independent contractors and trimming the fat, justifying it with a vague gesture toward “an unprecedented time.”

That’s why, in my opinion, you’re seeing the NASDAQ hitting record highs despite everyone’s turmoil — depressingly, investors can see that large companies are tightening up and cleaning up waste, while finding an affordable workforce at will. As they have unbundled themselves from our physical offices, large enterprises are going to unbundle themselves from having to have a set number of employees.

When Square allowed its entire workforce to work remotely permanently. It wasn’t just because they wanted them to feel more creative and productive, but was likely a move away from having quite as much expensive, needless office space.

Similarly, if there is work that a full-time employee does that could be done by a flexible, independent contractor, why not make that change too? And it’ll be a lot easier to make without as many people at the office.

The argument I’m making is not anti-contractor, though.

I can’t think of any point in history where it’s been better to create a freelance business — the startup costs are significantly lower, and as companies move toward remote work, you can theoretically take business nationally (or internationally) like never before. Companies’ moves toward replacing W-2 workers with contractors is an opportunity for people to create their own miniature freelance empires, unbundling themselves from corporate America’s required hours, and potentially creating a way to weather future storms by taking away any single company’s leverage on their income.

The rush to remote work is also likely to push more workers into the freelance economy too. By having to create a remote office, with a remote presence in meetings and having to manage and organize our days, the average worker has all but adjusted to the life of a freelancer.

Where some might have gone to an office and had things simply happen to them, the remote world requires an attention to your calendar and active outreach to colleagues that, well, models how one might run a freelance business. Those with core skillsets that can be marketed and sold to multiple clients should be thinking about whether being a wage slave is necessary anymore, and with good reason.

That said — corporate America, and especially tech, has to treat this essential workforce with a great deal more empathy and respect than they have thus far.

Uber and Lyft were ordered to treat drivers as employees in part due to the fact that they never treated their contractors like parts of the company. Other than the obvious lack of benefits (paid time off, health insurance, etc.), Uber, like many large enterprises, treats contractors as disposable rather than flexible, despite them being the literal driving force of the company. When Uber went public, they gave a nominal bonus for drivers that had completed 2500 to 40,000 trips, with a chance to buy up to $10,000 of stock — at the IPO price. These drivers, that had been the very reason that many people became millionaires and billionaires when Uber went public, were given the chance to maybe make money, if they sold the stock quickly enough.

It’s an abject lesson on how to not build loyalty with independent contractors. It’s also a lesson on what the next big company that wants to build themselves off the back of the 1099’er should do.

What I’m suggesting is a radical rethinking of freelance contracting. I want you to see independent contractors as a different kind of worker, not as a way of skirting getting a full-time employee. A freelancer, by definition, is someone that you don’t monopolize, and someone that you should actively give agency and, indeed, part of the network you’re building. One of the issues of corporate America’s approach to freelance work is an us-versus-them approach to employment — you’re either part of us or you’re simply a thing we pick up and put down. What I’m suggesting is treating your freelancers as an essential part of your strategy, and compensating them as such. Freelancers should own equity and should have skin in the game — they may be working with you on a number of projects and take literal ownership of vast successes throughout your history.

Contracted work has only become mercenary through the treatment of the freelance worker. Where tech has succeeded in creating hundreds of thousands of independent contractor positions, it also has to lead the way in reimagining how we may treat them and reward them for their work. And corporate America needs to take a step beyond simply seeing them as a cheaper, easier way to do business. They’re so much more.

#column, #covid-19, #employment, #freelancer, #gig-economy, #government, #labor, #opinion, #policy, #remote-work, #startups, #tc

Lyft plans to suspend rideshare operations in California tonight

Lyft is planning to suspend its ridesharing operations in California beginning tonight at 11:59 pm PT, unless it receives a stay from the Court of Appeals today.

“We don’t want to suspend operations,” Lyft wrote in a blog post. “We are going to keep up the fight for a benefits model that works for all drivers and our riders. We’ve spent hundreds of hours meeting with policymakers and labor leaders to craft an alternative proposal for drivers that includes a minimum earnings guarantee, mileage reimbursement, a health care subsidy, and occupational accident insurance, without the negative consequences.”

This month, both Uber and Lyft argued in court that they should be able to continue classifying their drivers as independent contractors. A judge disagreed, and granted a preliminary injunction to force both companies to reclassify their drivers as employees beginning Friday. In response, both Uber and Lyft said they would be forced to temporarily pause operations in California.

Yesterday, Uber CEO Dara Khosrowshahi said on a podcast that the company can’t simply hire all 50,000 of its drivers overnight.

“All of our model, everything that we have built is based on this platform that brings earners and brings people who want transportation or delivery together,” he said on a Vox Media podcast yesterday. “You can’t flip that stuff overnight. It’ll take time, and we will figure out a way to be in California. We want to be in California. But if the court case comes in, then we’ll have to shut down, and we’ve got the best engineers in the world figuring out how we can rebuild this thing. If we do have to go to employment model, what’s going to happen is that we will then have to underwrite driver productivity. There will be far fewer drivers employed, so my guess is 70-80% of users who use Uber for flexibility, they drove 5 to 10 hours, etc., they will not be able to earn. The prices are going to go up. They’re going to go up less in city centers. So I think SF prices will go up by 20%. Smaller cities prices will go way up.”

What Uber is proposing with Prop 22 is essentially a third way of classifying gig workers, but co-founder of Gig Workers Collective Vanessa Bain says a third way “is bullshit,” she said on the same Vox Media podcast yesterday.

“It’s categorically less than what we’re entitled to under current law,” she said.

TechCrunch has reached out to Uber to see if the company has made a decision yet regarding California. We’ll update this story when we hear back.

Below is a timeline of what’s led to this moment.

January 1, 2020: Assembly Bill 5 becomes law. The bill, first introduced in December 2018, codified the ruling established in Dynamex Operations West, Inc. v Superior Court of Los Angeles. In that case, the court applied the ABC test and decided Dynamex wrongfully classified its workers as independent contractors. According to the ABC test, in order for a hiring entity to legally classify a worker as an independent contractor, it must prove (A) the worker is free from the control and direction of the hiring entity, (B) performs work outside the scope of the entity’s business and (C) is regularly engaged in an “independently established trade, occupation, or business of the same nature as the work performed.”

May 2020California Attorney General Xavier Becerra, along with city attorneys from Los Angeles, San Diego and San Francisco, filed a lawsuit asserting Uber and Lyft gain an unfair and unlawful competitive advantage by misclassifying workers as independent contractors.

The suit argues Uber and Lyft are depriving workers the right to minimum wage, overtime, access to paid sick leave, disability insurance and unemployment insurance. The lawsuit, filed in the Superior Court of San Francisco, seeks $2,500 in penalties for each violation, possibly per driver, under the California Unfair Competition Law, and another $2,500 for violations against senior citizens or people with disabilities.

June 2020: Becerra and others file a motion for a preliminary injunction seeking to force Uber and Lyft to immediately classify their drivers as employees.

August 6, 2020: California Superior Court Judge Ethan P. Schulman hears arguments pertaining to the preliminary injunction. At the hearing, Uber and Lyft maintained that an injunction would require them to restructure their businesses in such a material way that it would prevent them from being able to employ many drivers on either a full-time or part-time basis. Uber and Lyft’s argument, effectively, is that classifying drivers as employees would result in job loss.

“The proposed injunction would cause irreparable injury to Lyft and Uber, and would actually cause massive harm to drivers and harm to riders,” Rohit Singla, counsel for Lyft, said at the hearing.

For example, Lyft estimates it would cost hundreds of millions of dollars simply to process the I-9 forms, which verify employment eligibility. It doesn’t cost anything to file that form, but it would require Uber and Lyft to further invest in their human resources and payroll processes.

August 9, 2020: Judge Schulman grants the preliminary injunction, which goes into effect on August 20, 2020.

“The Court is under no illusion that implementation of its injunction will be costly,” Judge Schulman wrote in the order. “There can be no question that in order for Defendants to comply with A.B. 5, they will have to change the nature of their business practices in significant ways, such as by hiring human resources staff to hire and manage their driver workforces.”

Meanwhile, Uber and Lyft made clear their respective plans to file emergency appeals.

August 12, 2020: Uber CEO Dara Khosrowshahi says Uber will have to temporarily shut down in California if the court doesn’t overturn the preliminary injunction. Lyft says it, too, will be forced to temporarily cease operations in California.

August 13, 2020: Judge Schulman denies Uber and Lyft’s appeal. Uber says it plans to file another appeal, while Lyft says it will seek a further stay from the state’s appellate court.

August 14, 2020: Lyft files a request for an immediate stay in California’s appeals court.

August 17, 2020: Uber files an emergency stay request in California’s appeals court.

August 19, 2020: San Diego and San Jose mayors call for the Court of Appeal to grant Uber and Lyft’s motions and stay the injunction.

Looking ahead

November 2020: Californians will vote on Prop 22, a ballot measure majorly funded by Uber, Lyft and DoorDash. Prop 22 aims to keep gig workers classified as independent contractors. The measure, if passed, would make drivers and delivery workers for said companies exempt from a new state law that classifies them as W-2 employees.

The ballot measure looks to implement an earnings guarantee of at least 120% of minimum wage while on the job, 30 cents per mile for expenses, a healthcare stipend, occupational accident insurance for on-the-job injuries, protection against discrimination and sexual harassment and automobile accident and liability insurance.

Developing…

#ab-5, #automotive, #gig-economy, #lyft, #tc, #transportation, #uber

Dumpling launches to make anyone become their own Instacart

Gig economy companies like to tout the flexibility and freedom they offer workers, but for the people finding work through companies like Instacart, Uber, DoorDash and Lyft, the economic and physical risks can outweigh the rewards.

Contractors who are now considered front-line providers of essential services for their wealthier customers in the age of social distancing brought on by the COVID-19 epidemic have struggled with lack of benefits, lost tips and wages, and a dearth of back-end support.

Dumpling, a startup in the food delivery space, was born to challenge the status quo in the gig economy by giving more ownership to the workers that power it. Dumpling connects shoppers to all the resources they need to migrate off the Instacart platform and start their own personal-shopping business.

Dumpling is launching with a focus on food delivery, as the pandemic has transformed the perk into an essential service for home-bound citizens. So far, it has enabled more than 2,000 shoppers in all 50 states to become their own personal Instacarts.

Dumpling co-founders Joel Shapiro and Nate D’Anna met in college and were looking for a way to work together. Shapiro and D’Anna ditched their corporate jobs at National Instruments and Cisco, respectively, to create Dumpling.

“[We thought] what if we actually create a company to solve their problems and not just the one percenters hanging out on the coast?” D’Anna said

Before we get into how Dumpling works, let’s discuss the obvious: Not every gig worker wants to be a business owner, which is exactly the opposite of what the startup needs to succeed. Despite the gig economy’s proliferation over the last decade, only 3% of adults said they performed gig work as a primary source of income; fewer than 1 in 10 adults were full-time gig workers, according to the Federal Reserve’s latest report.

Instead, a larger issue within the gig economy is classification of workers, leading to the rise of unions and co-ops for more shopper support. 

Dumpling is another example of what the future would look like. 

Shapiro admits that not every gig worker will need Dumpling. But instead of pitching Dumpling solely as a place for gig workers to start their own businesses, he thinks the startup can bring more money into workers’ hands.

“With multiple years of all these multi-demand apps, we know that workers are going to be exploited and screwed at some point and their pay is going to be drastically reduced,” he said. “We’re trying to make them ultimately have control so the rug can’t be pulled out underneath them.”

How it works

To start, Dumpling helps users create their own LLCs. Then it offers a slew of different products, including a Dumpling credit card to help shoppers buy groceries before customer payment, an app to help centralize deliveries and customer communication, and a forum for mentorship and worker support.

Image Credits: Joel Shapiro / Dumpling

Shoppers primarily acquire customers through marketing and self-promotion when dropping off orders for other delivery apps, according to Dumpling. Some customers have recently started going directly to Dumpling to look for shoppers to order from in the area.

Dumpling gives 100% of tips to business owners. Unlike Instacart, Dumpling allows business owners to pick what tip options show up for their customers and set a personal default tip minimum. There is also space for customers to leave reviews.

The company makes money in a few different ways. It charges shoppers a one-time $10 fee to set up, which includes a Dumpling credit card, a listing on the website and a shopper search tool. The platform then charges shoppers either a $39 monthly fee or a $5 per-transaction fee for each time they book a job. On the other end, customers pay 5% on top of orders for payment processing.

Dumpling claims it can help shoppers make three times as much money as Instacart shoppers. But let’s do the math.

While the monthly fee or $5 per-transaction fee could eat into tips, Dumpling claims that users make $33 in average earnings per order, which is three times as much as Instacart users. Instacart estimates that full-service shopper pay ranges from $7 to $10 per order, according to a NerdWallet article.

Because shoppers can set their own rates, customers could simply flock to the cheapest option of the day, thus driving competition between shoppers to keep rates low (and make less money).

There are a few reasons why Dumpling doesn’t think it’s going to be a race between shoppers.

First, Dumpling customers are largely repeat clients who crave a personalized shopper to help them out. This repeatability gives shoppers some flexibility and stability, income-wise. Shoppers can schedule weekly grocery delivery times so they can manage the orders, instead of trying to drive an Uber and maximize their time on the road.

Second, Shapiro hopes that pricing isn’t the only reason a customer goes to a shopper. He noted that reviews and ratings are big sells, as well as areas of focus like vegan, local farmers’ markets, dietary restrictions and special diets. Imagine if you’re newly joining Keto and you can get a Keto-savvy shopper to pick up ingredients for you, in other words.

In the past three months, the platform has brought in tens of thousands of reviews on shoppers. The average rating of a Dumpling shopper is 4.9 to 5 stars.

It can’t fix what is broken

Even though Dumpling wants to bring ownership to the gig economy, it is experimenting with ways to support its growing network. One way would be getting bulk discounts on health insurance and benefits. Soon, Dumpling is starting a fraud protection benefit for any shopper on its platform.

While Dumpling can’t fix the gig economy, it can drastically change the way that the people within it work and own their career. Especially those few who rely on the gig economy as their sole job.

Matthew Telles, one of Instacart’s first shoppers in Chicago, fondly remembers the grocery delivery platform’s early days. He would average 20% tips on all orders, rarely drove more than five miles for a delivery and was even invited to staff engineering calls to give feedback on the platform.

Then Amazon bought Whole Foods, a deal which Telles thinks pressured Instacart to get the biggest market reach as quickly as possible (which included saving money). He received orders from all over the state. Instacart threatened to take away tips. The engineering call invites stopped.

Five years later, Telles remains on the app to advocate for shoppers. His efforts have contributed to millions in settlement payments from Instacart. The company, which has risen to a level of prominence during the pandemic, recently turned its first profit. Its shopper network continues to complain of lack of support from the platform, and has organized multiple times for better wages, changing default tip minimums and personal protective equipment.

“Fighting Instacart is my hobby now,” Telles said. “Dumpling is now my career.”

Dumpling did not disclose profitability, but said order volume has spiked by 20x. The unprecedented growth has led Dumpling to recently announce it raised $6.5 million in Series A funding, led by Forerunner Ventures. Participating investors include Floodgate and FUEL Capital. The company’s total known venture funding to date is $10 million.

As for Telles, he loves the flexibility he can have to pick up a gratitude meal for the most consistent customers along with their groceries. He’s cut his hours in half and doubled his income by going full time on the app. And, to his delight, he’s been invited on calls with Dumpling’s co-founders themselves, similar to the early days of Instacart.

#apoorva-mehta, #delivery-startups, #doordash, #dumpling, #future-of-work, #gig-economy, #gig-workers, #instacart, #joel-shapiro, #lyft, #nate-danna, #startups, #tc

UK Uber drivers are taking its algorithm to court

A group of UK Uber drivers has launched a legal challenge against the company’s subsidiary in the Netherlands. The complaints relate to access to personal data and algorithmic accountability.

Uber drivers and Uber Eats couriers are being invited to join the challenge which targets Uber’s use of profiling and data-fuelled algorithms to manage gig workers in Europe. Platform workers involved in the case are also seeking to exercise a broader suite of data access rights baked into EU data protection law.

It looks like a fascinating test of how far existing legal protections wrap around automated decisions at a time when regional lawmakers are busy drawing up a risk-based framework for regulating applications of artificial intelligence.

Many uses of AI technology look set to remain subject only to protections baked into the existing General Data Protection Regulation (GDPR). So determining how far existing protections extend in the context of modern data-driven platforms is important.

The European Commission is also working on rebooting liability rules for platforms, with a proposal for a Digital Services Act due by the year’s end. As part of that work it’s actively consulting on related issues such as data portability and platform worker rights — so the case looks very timely.

Via the lawsuit, which has been filed in Amsterdam’s district court today, the group of Uber drivers from London, Birmingham, Nottingham and Glasgow will argue the tech giant is failing to comply with the GDPR and will ask the court to order immediate compliance — urging it be fined €10,000 for each day it fails to comply.

They will also ask the court to order Uber to comply with a request to enable them to port personal data held in the platform to a data trust they want to establish, administered by a union.

For its part Uber UK said it works hard to comply with data access requests, further claiming it provides explanations when it’s unable to provide data.

Data rights to crack open an AI blackbox?

The GDPR gives EU citizens data access rights over personal information held on them, including a right to obtain a copy of data they have provided so that it can be reused elsewhere.

The regulation also provides some additional access rights for individuals who are subject to wholly automated decision making processes where there is a substantial legal or similar impact — which looks relevant here because Uber’s algorithms essentially determine the earning potential of a driver or courier based on how the platforms assigns (or withholds) jobs from the available pool.

As we wrote two years ago, Article 22 of the GDPR offers a potential route to put a check on the power of AI blackboxes to determine the trajectory of humankind — because it requires that data controllers provide some information about the logic of the processing to affected individuals. Although it’s unclear how much detail they have to give, hence the suit looks set to test the boundaries of Article 22, as well as making reference to more general transparency and data access rights baked into the regulation.

James Farrar, an Uber driver who is supporting the action — and who was also one of the lead claimants in a landmark UK tribunal action over Uber driver employment rights (which is, in related news, due to reach the UK Supreme Court tomorrow, as Uber has continued appealing the 2016 ruling) — confirmed the latest challenge is “full spectrum” in the GDPR rights regard.

The drivers made subject access requests to Uber last year, asking the company for detailed data about how its algorithm profiles and performance manages them. “Multiple drivers have been provided access to little or no data despite making a comprehensive request and providing clear detail on the data requested,” they write in a press release today.

Farrar confirmed that Uber provided him with some data last year, after what he called “multiple and continuous requests”, but he flagged multiple gaps in the information — such as GPS data only being provided for a month out of two years’ of work; no information on the trip rating assigned to him by passengers; and no information on his profile nor the tags assigned to it.

“I know Uber maintain a profile on me but they have never revealed it,” he told TechCrunch, adding that the same is true of performance tags.

“Under GDPR Uber must explain the logic of processing, it never really has explained management algorithms and how they work to drivers. Uber has never explained to me how they process the electronic performance tags attached to my profile for instance.

“Many drivers have been deactivated with bogus claims of ‘fraudulent use’ being detected by Uber systems. This is another area of transparency required by law but which Uber does not uphold.”

The legal challenge is being supported by the App Drivers & Couriers Union (ADCU) which says it will argue Uber drivers are subject to performance monitoring at work.

It also says it will present evidence of how Uber has attached performance related electronic tags to driver profiles with categories including: Late arrival/missed ETAs; Cancelled on rider; Attitude; Inappropriate behaviour.

“This runs contrary to Uber’s insistence in many employment misclassification legal challenges across multiple jurisdictions worldwide that drivers are self-employed and not subject to management control,” the drivers further note in their press release.

Commenting in a statement, their attorney, Anton Ekker of Ekker Advocatuur, added: “With Uber BV based in the Netherlands as operator of the Uber platform, the Dutch courts now have an important role to play in ensuring Uber’s compliance with the GDPR. This is a landmark case in the gig economy with workers asserting their digital rights for the purposes of advancing their worker rights.”

The legal action is being further supported by the International Alliance of App-based Transport (IAATW) workers in what the ADCU dubs an “unprecedented international collaboration”.

Reached for comment on the challenge, Uber emailed us the following statement:

Our privacy team works hard to provide any requested personal data that individuals are entitled to. We will give explanations when we cannot provide certain data, such as when it doesn’t exist or disclosing it would infringe on the rights of another person under GDPR. Under the law, individuals have the right to escalate their concerns by contacting Uber’s Data Protection Officer or their national data protection authority for additional review.

The company also told us it responded to the drivers’ subject access requests last year, saying it had not received any further correspondence since.

It added that it’s waiting to see the substance of the claims in court.

The unions backing the case are pushing for Uber to hand over driver data to a trust they want to administer.

Farrar’s not-for-profit, Worker Info Exchange (WIE), wants to establish a data trust for drivers for the purposes of collective bargaining.

“Our union wants to establish a data trust but we are blocked in doing so long as Uber do not disclose in a consistent way and not obstruct the process. API would be best,” he said on that, adding: “But the big issue here is that 99.99% of drivers are fobbed off with little or no proper access to data or explanation of algorithm.”

In a note about WIE on the drivers’ attorney’s website the law firm says other Uber drivers can participate by providing their permission for the not-for-profit to put in a data request on their behalf, writing:

Worker Info Exchange aims to tilt the balance away from big platforms in favour of the people who make these companies so successful every day – the workers.

Uber drivers can participate by giving Worker Info Exchange their mandate to send a GDPR-request on their behalf.

The drivers have also launched a Crowdjustice campaign to help raise £30,000 to fund the case.

Discussing the legal challenge and its implications for Uber, Newcastle University law professor Lilian Edwards suggested the tech giant will have to show it has “suitable safeguards” in place around its algorithm, assuming the challenge focuses on Article 22.

“Article 22 normally gives you the right to demand that a decision made in a solely automated way — such as the Uber algorithm — should either not be made or made by a human. In this case Uber might claim however, with some success, that the algorithm was necessary for the Uber context with the driver,” she told us.

“However that doesn’t clear their path. They still have to provide ‘suitable safeguards’ — the biggest of which is the much-discussed right to an explanation of how the algorithm works. But noone knows how that might operate.

“Would a general statement of roughly how the algorithm operates suffice? What a worker would want instead is to know specifically how it made decisions based on his data — and maybe how it discriminated against him or disfavoured him. Uber may argue that’s simply impossible for them to do. They might also say it reveals too much about their internal trade secrets. But it’s still terrific to finally have a post GDPR case exploring these issues.”

In its guidance on Article 22 requirements on its website, the UK’s data watchdog, the ICO, specifies that data controllers “must provide meaningful information about the logic involved in the decision-making process, as well as the significance and the envisaged consequences for the individual”.

It also notes Article 22 requires that individuals who are subject to automated decisions must be able to obtain human review of the outcome if they ask. The law also allows them to challenge algorithmic decisions. While data controllers using automation in this way must take steps to prevent bias and discrimination.

#ai, #algorithmic-accountability, #apps, #artificial-intelligence, #automated-decisions, #europe, #gdpr, #gig-economy, #james-farrar, #lawsuit, #platform-workers, #transportation, #uber