These days, companies need to use every available avenue to acquire talent, and more people inside your organization will need to know the options — and what they mean to your organization. As a program manager, you can identify the various channels with some sense of clarity around how one channel may carry more risk than another, but consider your managers who bring in people periodically on their own. Do they know if they are putting the company at risk?
The gig economy offers a multitude of way for workers, employers and consumers to get what they want/need. And gig workers get the opportunity to work how they want and manage their careers from a completely different angle as well. I am not convinced that either party understands enough about labor classification to know if they are protecting themselves and each other.
Paint the picture of the millennial worker who signs up on a freelancer management platform as a mobile application developer. One company likes his/her portfolio and engages the worker through the system to build an app. Meanwhile, other companies are evaluating the person’s portfolio and looking to engage the same worker. Each potential employment opportunity is for less than a full-time schedule, but the worker chooses to take multiple opportunities for a workload that adds up to more than 40 hours per week. If the worker does this with a number of companies and moves from opportunity to opportunity managing his/her own “mobile app business” via the freelancer platform, then it seems as though both parties (the worker and the buyer of her/his services) are OK as long as the freelancer management platform gives the worker and the government the necessary information to file for tax and audit purposes. In this case, parameters are in place that support a lower-risk engagement of services you are not positive are delivered by a true independent contractor. This would mean that the contractor used one platform to manage all of her/his work with multiple clients. This may not always be the case, though, which brings up the discussion on the amount of risk tolerance one company may have over another.
As more ways to find work are developed and more job seekers utilize emerging ways to find opportunities and get engaged, how sure can you be that they are independent? What happens when they start in one department in your organization for a project and move from project to project, department to department? On the one hand, that would be an ideal way to engage talent and manage the allocation of available resources, but on the other hand, you could be grossly misclassifying someone as independent while the structure that supports a qualified independent contractor relationship doesn’t really exist.
Based on the number of lawsuits affecting the Uberization of the workforce, we can see that issue is no longer as cut and dry as it used to be (Remember the 20 questions or the behavioral categories of evidence from the IRS for worker classification?) The real question is how far will the issues go in the “free” or more “controlled” ways of working before worker classification laws are changed? How long will it actually take? Will the new way of working include heavier tax regulation on the worker or the company/consumer of the worker services? It is clear that employment regulations will need to change in the US, the question is how and when? Who will drive that change — businesses like Uber or the workers that are filing lawsuits for overtime pay, benefits and such?
The general working-age population in the US will need to be more informed about their own rights and liabilities as it relates to the way they work. Today, the majority of workers do not understand labor classification as it stands, and tend to fall into two camps: those who feel cheated and want benefits, overtime and such like employees of a company, and those who want to determine their own schedule and how much they make in a given month. One camp is gaining ground, with more and more lawsuits being recorded over worker classification. Change is the constant and legislation will need to change to move forward in the new world of work.