The Labor Department on Tuesday announced a new rule that makes it more likely that gig workers get classified as employees — the latest pro-labor turn from the Biden administration.
. They've won the latest round in the yearslong back-and-forth over whether or not they count as employees under federal labor law and are entitled to earn federal minimum wage and overtime.App companies like Uber and Lyft generally classify their drivers as "independent contractors," arguing that workers haveA previous rule from the Trump Labor Department lined up with this reasoning.
The proposal even appears to directly address ride-sharing specifically by saying "the use of a personal vehicle that the worker already owns to perform work — or that the worker leases as required by the employer to perform work—is generally not an investment that is capital or entrepreneurial in nature.""We're hoping this will change lots of business practices," Laura Padin, director of work structures at the National Employment Law Project, tells Axios.
The fight over this issue has raged for a while, particularly in California, which initially passed a law called AB5 that would have classified many gig workers as employees.lobbying to reverse that law via a voter referendum called Proposition 22.Zoom out:
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