App Companies Propose New Model For Worker Benefits (cio.com)

itwbennett writes: In late October, four delivery drivers for the app-based Amazon Prime Now service filed a class-action lawsuit alleging the company misclassifies its workers as contractors. In June, the California Labor Commission ruled that Uber drivers are employees, not contractors. Now, worker advocacy groups, companies offering services through apps (including Lyft, Etsy, Care.com, and Instacart), a variety of policy experts, and venture capitalists are proposing a new model for worker benefits that will be "portable" across the number of jobs they do in the new on-demand economy. "Self-employed workers choosing to engage in flexible work may also encounter unforeseen work disruptions or other hardships without the protections and benefits that may be provided through full time employment," the group said in a statement posted on Medium.

Comments

Yeah it's called being self-insured

[Anonymous Coward]

The model of relying on a business to provide benefits to its employees in lieu of the government or the employees themselves turns the employee into a serf, unable to leave in fear of losing their benefits. COBRA was the last grand experiment in government meddling in "portable" healthcare benefits and it was by all accounts a miserable failure.

Re:Yeah it's called being self-insured

[ShanghaiBill]

The model of relying on a business to provide benefits to its employees in lieu of the government or the employees themselves turns the employee into a serf

Indeed. In Maoist China, each factory ran their own schools. So if you changed jobs, your kids had to switch to a new school. This is clearly idiotic, but our system of employer provided healthcare/pensions is just as dumb. There are advantages and disadvantages to privatized and socialized healthcare and pensions, but the third option, of employer provided benefits, gives the worst of both, with the benefits of neither. Employees should be paid with money and only money. Benefits should be provided privately or by the government. They should not be tied to employers. That would be better for workers and companies.

Re:Yeah it's called being self-insured

[Pseudonymous Powers]

It's a nice idea, but Weather Generator operations are actually a very small part of the COBRA budget.

Many armchair accountants are surprised to learn that, by far, COBRA's major expenditures are, simply, blue lasers. Laser weapons capable of blowing up a aircraft in flight and compact enough to be wielded by a common foot soldier are almost impossibly expensive, and COBRA loses at least four hundred of these in every single engagement. When you add to this fact that not a single COBRA laser blast has ever managed to inflict a human casualty, it really exposes how desperately overdue they are for a shakeup in their tactics.

Re:Yeah it's called being self-insured

[ShanghaiBill]

Retirement can be rolled

Many pension plans require vesting, so if you quit or are fired, you forfeit the benefits. Also, many companies fund their pensions with their own stock, so if the company goes tits-up, you lose both your job and your savings at the same time.

becoming a new employee automatically qualifies you for open enrollment.

Not always. Companies can have a probationary period where new employees are ineligible for benefits. They can also exclude certain classes of employees, such as part-time, temp, union members (who get benefits through their unions), exempt/non-exempt, commission based employees, management, etc.

Re:Yeah it's called being self-insured

[davester666]

My dad told me a story of when he worked at Kenworth, where a co-worker of his had worked for 24 years+, and six months before his retirement and pension, the boss fired him for cause [gave him a bad review, first one ever], just to try to save having to pay out the pension. It took almost a year for the guy to get his pension back through the courts. Of course, this was back in the '70s. Employers don't have to do this now.

Re:Yeah it's called being self-insured

[mi]

Employees should be paid with money and only money.

And they were — until the US government imposed limits on salaries during the Second World War. Employers wanting to attract employees invented the "benefits packages" of various kind, that circumvented the government-imposed maximum wage limits.

As the consumers of and payers for services became different entities, the prices started to rise. Attempts at finding a government-based solutions to the government-created problem further exacerbated it, as always happens. And continue to.

So... they reinvented the union.

[0100010001010011]

Right now when something is being built the builders call up the local unions and say "I'm going to need 5 Union plumbers and 2 Union electricians for 6 weeks".

Present a single front to all companies needing developers for work weeks, salary and benefits.

Just call it a Union. (And that's not a bad thing).

Re:So... they reinvented the union.

[bws111]

Unions and contractors are not the same thing at all. My friends father was a pipefitter, a highly skilled job. He was not an employee of any company, he was a member of the pipefitters union. When someone had industrial plumbing to be done they would contact the union, the union posted the job, and someone took it. That person then paid a percentage of their wages to the union, and the union in turn had pension and benefits services for the members. The union also determined the wages for pipefitters.

A contractor, on the other hand, is either self-employeed, or employees other people. People hire the contractor, and he pays his employees. The rate the contractor is paid may be much different than what he pays his employees.

Re:FIRST

[NotInHere]

See, even here the system fails.

This is game playing

[Bruce66423]

You pay them one rate as contractors, more cash with limited benefits, or as employees, with less cash but more benefits. Given the need for start ups to employee people on highly variable contracts, and the existence of people for whom variability is acceptable, this can be worked out. Where the problem lies in the growing tendency of firms such as supermarkets to keep a stock of variable hours labour. The ideal is to have a civilised conversation about this whole area; the danger is that we lose the ability to grow new start ups cheaply.

Re:This is game playing

[TWX]

There never will be an ideal. That's why it's an ideal, it's a fictional asymptote that never be reached.

This is why I am in favor of single-payer. Remove the concept of insurance altogether, it isn't insurance that people need, it's the ability to go to the damn doctor or hospital. Worried about fraud? The current system already has loads of fraud in the form of the screwed-up billing, fraud against the patient. Make fraud by the billing-entity (ie, the clinic or doctor) a federal crime.

With medical care decoupled from the workplace, employers would have less incentive to restrict employee hours to the numbers needed to legally be part-time. More people that struggle to find full-time work could actually work full time in jobs that of-late have been part-time, like retail. It still has its downsides but if employees now can actually afford to make rent by working one job then quality of life is much improved.

Re:Unemployed

[fluffernutter]

I can't believe anyone would choose an Uber-type job if they were eligible in any way for a 9-5 job. People take Uber jobs because they either can't find alternative employment or they can't hack it in a standard job interview.

Benefits my ass

[PopeRatzo]

Stop calling them "benefits" and just call them what they are, which is compensation. Corporations (and politicians) have used the term "benefits" to be the equivalent of the corporations giving their employees welfare. They've actually used this term, "benefits" in PR campaigns to steal employees retirement packages.

If you get health insurance, sick days, retirement, it's because you earned them. They are yours. It's not company largesse.

Re:Benefits my ass

[PopeRatzo]

In Wisconsin, for example, vacation days [ehow.com] are pretty much down to company largesse. They can set nearly any policy they want; use it by X or lose it, we're not going to pay it out if you leave, taking vacation has to be approved by two levels of management on forms submitted in triplicate, etc.

Wisconsin got what Wisconsin voted for, an anti-worker governor and legislature.

They'll learn.

Re:Fuck the unions.

[Chris Johnson]

Meritocracy only works if it's not a lie. It doesn't magically happen out of nowhere, it's a consequence of a system that can cull bad actors.

Real life is not that system. In real life, bad actors, con artists and CEOs run amok exactly as much as they're allowed to.

Completely deregulate and go full retard (to use what ought to be, but isn't, a more politically correct and inoffensive term for 'free market') and you only guarantee without a shadow of a doubt that your OCRACY is the farthest possible thing from MERIT.

In the best of all possible hypothetical worlds, the best you could hope for is that merit is not actively a disadvantage: nobody's penalized for wasting time and effort getting good. In this world, that's time better spent learning to con people, or building up a social media herd of suckers to fleece, and choose wisely.

Please never all-capitalize meritocracy again. As it is a malicious lie in the absence of a serious and well-organized and administered system with coherent goals and definitions of 'merit', it doesn't deserve even one capital letter, really.

Next you'll be telling me Google, and YouTube, are meritocracy in action. Or Uber.

Re:Unemployed

[ShanghaiBill]

I can't believe anyone would choose an Uber-type job if they were eligible in any way for a 9-5 job.

I know several people that do that. My sister drives for Uber. She has a day job, but drives for a couple hours each evening to earn some extra cash. She enjoys meeting new people, and although driving is stressful for me, she says it is relaxing.

Re:Universal Healthcare

[Moof123]

Best compliment I've gotten all day.

Portable health care

[sjbe]

The model of relying on a business to provide benefits to its employees in lieu of the government or the employees themselves turns the employee into a serf, unable to leave in fear of losing their benefits.

Which is I think a part of why Republicans seem to hate "Obamacare" so much. They've lost their leverage to keep people subservient.

COBRA [dol.gov] was the last grand experiment in government meddling in "portable" healthcare benefits and it was by all accounts a miserable failure.

It wasn't a failure. COBRA did more or less what it was designed to do. It was designed to be a bridge, not ongoing portable insurance. The system around it was the failure. Used to be that if you lost your job you lost your health insurance too so you were doubly screwed. COBRA gave an (expensive) safety net option but it couldn't possibly solve the actual problem that was eventually solved with the Affordable Care Act. I've used COBRA insurance twice and it was fine for what it was.

Re:Portable health care

[DarkOx]

Affordable Care Act did not solve the problem at all in some ways it made it worse.

Under the ACA a job loss for most folks means the same insurance loss or COBRA situations as before. We get our insurance as an employee benefit, which our employers offer because they will be punatively taxed otherwise. So in addition to a job loss and the need to find a new job you also need to find a new insurance carrier, that you might only use for months or weeks while you are out of work, or pay some hugely expensive COBRA bill.

At the same time the ACA more or less eliminated minimal coverage and high deductible plans that people could have switched into in that situation. You don't need a plan that covers all that preventative care for example while you are unemployed and expecting that situation to be temporary. You do probably need/want to save money. The Affordable care act has ensured only expensive choices are available. Affordable my ass.

What the ACA should have done is destroy the group market rather than the individual market. Everyone could have just purchased individual insurance but not everyone is a member of a group. The sensible thing to have done would have been start taxing employer benefits as regular income, and DISCOURAGING employers from offering them. Then individual mandate or not (I would say not because I care about freedom) you could have simply made health/dental/vision insurance costs tax deductible on the individual income tax side.

The ACA was the most abject stupid design possible!

Freelancer's Union, all the way

[AnAlchemist]

For those of you as contractors, I highly recommend The Freelancer's Union (https://www.freelancersunion.org/). Liability, disability, and life insurance, all reasonable. Even medical and dental insurance in some places, like NYC.

Reasonable prices, and fast customer service.

Disclaimer: I'm just a happy customer/client/member, whatever you wanna call it.

Re:Universal Healthcare

[Moof123]

They die.

What happens when the private insurance kills one of my relatives through penny-pinching on diagnostic tests or it decides that expensive cancer drug keeping you alive is just too expensive?

They die.

No system is perfect. None.

Our system has worse outcomes for more money than comparable countries with single payer healthcare. ACA has snubbed the costs and put in measures to improve outcomes, but these are just stopping our system from getting much worse rather than closing the gap of outcomes and competiveness that other countries enjoy.

Get paid more

[viperidaenz]

That's why contract workers should be paid a lot more than an employee.
If I find myself without a contract, I don't go bitching to a lawyer that I should have been classified as an employee and was unjustifiably dismissed.
I accept that fact I am self employed. It helps I get paid twice as much as the employees I sit next to for doing the same job.

Re:Car (Insurance) Analogy!

[viperidaenz]

Or have a health care system that doesn't require anyone to have insurance. It could cover accidents and compensation as well, so there is no need to sue someone who injures you for rehabilitation and lost wages.
Perhaps you could pay it from a levy on income. You could take a fixed % from employees/self employed people and a % based on the industry risk for the company making the income payment. That way every person pays the same % and the industries with the most accidents pay the most.

You could call it something like Accident Compensation Corporation.