Uberregulation

The ongoing legal drama around Uber concerns whether its drivers are contractors or regular employees for purposes of law and regulation. The answer to that question is not clear; after all, Uber drivers clearly have some characteristics of one and some of the other, so neither designation would fit them perfectly. But could there be a third way? The Wall Street Journal‘s Greg Ip discusses a new paper proposing to square the circle:

Classifying them as employees would immediately raise several prickly questions. Should Uber drivers be compensated for the time they spend waiting for rides? Should such time go toward determining a minimum hourly wage? Would driving for Lyft violate an employee’s duty of loyalty to Uber? [Authors Seth] Harris and [Alan] Krueger propose a new “independent worker” designation for such employees. They need not be covered by the National Labor Relations Act, but could jointly negotiate work conditions through an exemption to antitrust laws. The employer would have to deduct Social Security and Medicare contributions and withhold income tax. They would not be covered by federal overtime or minimum wage laws, or workers’ compensation and unemployment insurance, none of which are well suited to how independent workers operate. They would, however, be protected by federal anti-discrimination laws, and could be pooled with other workers so that the employer could obtain health insurance more cheaply for them.