Senate Holds “Gig Economy” Public Hearing

The Senate held a public hearing to engage stakeholders on the “gig economy” and its current labor practices. Under particular scrutiny were how companies like Uber, Lyft, and DoorDash classify workers as independent contractors rather than employees. Labor groups and advocates urged the members of the panel to consider a law similar to California’s new ABC test. The ABC test requires the satisfaction of three criteria in order to be considered an independent contractor, rather than an employee. The narrow test prescribed by California would have a significant impact on employee classification among app based companies, as well as, non-app based companies.

Business groups and other associations testified as well, urging a cautious approach in general and specifically asking lawmakers to consider a third way. Rather than implementing an ABC test, they suggested exploring options similar to the Black Car Fund, which was created to provide a system of worker’s compensation insurance for use by independent for-hire drivers. Others testified that classifying app-based drivers as employees would limit the driver’s ability to utilize more than one app and other aspects of flexibility they currently enjoy.

Senator Savino, chair of the hearing, arrived at no conclusions publicly and suggested additional hearings would be announced in the coming weeks.