Gig economy workers are generally classified as independent contractors. However, this classification has been continuously challenged by the gig economy workers, and at times, by the App based companies through whom they find work.
This has resulted in some state legislatures passing bills that require app-based companies to offer benefits, that are often reserved for employees of the app-based rideshare and delivery companies, to their independent contractors. The first such Bill was in California. Now, other states may be following suit.
In March 2022, Washington state lawmakers passed House Bill (“HB”) 2076: The Expand Fairness Act. Effective January 1, 2023, the bill gave Washington app-based drivers the following rights:
- state Workers’ Compensation coverage
- paid sick leave
- the guaranteed minimum pay for minutes worked, miles driven, and trips made
- a requirement that drivers must be provided just cause before account deactivation
- protection from retaliation for exercising these rights
Listen to this week's episode for the details on this ruling.
ZBP Zachary B. Pyers, Esq.
MM Motaz Mandili, Esq.
ZBP
Welcome to another installment of the Reminger Podcast on Emergent Technologies. I am thankful to be joined today by one of our new associates here in the Columbus office, Motaz Mandili who is going to provide us an update on some recent legislative developments out of - actually in the State of Washington. It really deals with the gig economy and how they deal with gig economy workers, so we are really excited to have Motaz on this episode. Motaz, if you would, could you tell us a little about this recent legislative development.
MM
Absolutely. So, Washington State has paid family medical leave for all of their employees but, as we’ve seen gig workers aren’t often __________ employees. For those who aren’t familiar with it paid family medical leave allows employees to take time off to take care of their families or their own medical situations and unlike the federal program it actually does pay them for the 12 weeks that they take off. Now in March 2022, Washington law makers passed House Bill 2076 on the Expand Fairness Act which gave Washington at based drivers state workers’ comp coverage, paid sick leave, guaranteed minimum pay for their minutes worked, miles driven, trips made and/or _____________ the drivers are provided with just cause for account activation. As well as protecting them from ________________ rights but it did keep gig economy workers as independent contractors as we’ve seen in other states. This new decision or by decision I really mean statue, House Bill 1570 expanded the state’s unemployment insurance and paid family medical leave programs to the at based drivers as well. It’s the first state in the nation that we’ve seen that provided at based drivers with any kind of FMLA or unemployment insurance and while paid FMLA isn’t normally provided in other states it is a pretty big benefit to provide to gig based economy workers in Washington State.
ZBP
Tell us, and I think you kind of already touched on this at least a little bit, why is this so important, you know, as a development. Why are we talking about this?
MM
Well, as we’ve seen in other states, there’s balance that we try to strike between allowing independence and at based gig workers and then providing them with benefits because a lot of them do work these jobs exclusively or working full time and then to see this expansion to unemployment insurance and paid FMLA, this is one of the biggest explanation of benefits for these workers while still allowing them the independence that they get for being independent contractors. It’s truly a compromise that tilts a little bit more towards the workers than even Proposition 22 while still being an acceptable compromise for the companies, state lawmakers and _________________ readers.
ZBP
You mentioned Prop 22, just for our listeners who may not have listened to all of our Podcasts, but that refers to I should say, the legislation and the laws based out of California that address the and maintain the independent contractor status for a lot of this gig economy workers but allow the companies to provide some benefits to them, to the workers without having the workers end up being classified as actual employees correct?
MM
Correct.
ZBP
Yea. So tell me, if we look at this legislation, obviously this is only based in the state of Washington so it’s not, it doesn’t have far reaching impacts over all 50 states. What do you see next with this?
MM
So, I think we’ll see two different, you know, changes. We’ve had cities like Austin, Texas and New York City where they’ve tried to push you know more protection or more worker friendly statutes. Then you’d have the states themselves, Texas and New York that have passed more limiting you know legislation that keeps the companies operating in the state. What I think we’ll see next is you know other states might see this and have the thought to expand FMLA to their gig economy workers. Cities might try it as well but depending on where the cities are located, sometimes the states might also come in and reduce the impact especially with something like unemployment insurance which would you know be paid out by the state and could have quite a large tax advantage as well.
ZBP
Great. Motaz, thank you for taking the time to speak with us today. We really appreciate it. We’ll have you back on another episode soon.
MM
Thank you.