Recruiting

Biden Administration Takes a Close Look at Gig Economy

The so-called “gig economy,” in which workers are hired for specific, one-off, temporary, or seasonal jobs as opposed to long-term, permanent employment, has provided a great deal of benefit and flexibility to both employers and gig workers. Rather than traditional employment relationships in which workers might work a 40-hour week for a single employer, gig workers may have multiple temporary jobs at once, working as an independent contractor as opposed to a W-2 employee.

Workers Drawn to Gig Economy

Workers like the ability to set their own schedules and the greater flexibility gig work generally has compared with traditional employment relationships.

Gig workers also like the ability to earn a little extra cash by putting in a few extra hours, giving them some flexibility to scale their income up or down depending in their present situation.

Employers Also Benefit

Employers like the flexibility of being able to relatively quickly scale their staffing levels up or down depending on their needs, as well as the generally less stringent regulation around the treatment, compensation, and oversight of gig workers relative to traditional employees.

But work in the gig economy isn’t always as idyllic as it is in theory.

Potential Challenges

Often, independent contractors end up doing very similar work to traditional employees but don’t get the same benefits, which is a great way for employers to save money but less ideal for workers.

While the federal and various state governments have shown an interest in protecting independent contractors from abuse, some argue that their efforts, however well intentioned, often miss the mark. That’s the view of some observers looking at the Biden administration’s recent interest in revisiting how the gig economy is regulated.

Rule Changes Ahead?

“The [Biden] administration is following in the footsteps of California, which passed a wide-ranging freelance law that transformed the jobs of ‘independent writers, graphic designers, photographers, journalists, and content producers’—most of whom ‘didn’t seem to appreciate the reform’ passed in their behalf,” notes an article in The Week.

Whether or not the gig economy is forced to conform more closely to the rules that govern traditional employment arrangements will depend on events in Washington, D.C. However, both employers and gig workers around the nation will be anxiously awaiting the extent and nature of any updates to rules many have grown accustomed to.

Lin Grensing-Pophal is a Contributing Editor at HR Daily Advisor.