Coronavirus exposes Uber, Lyft drivers’ lack of safety net
NEW YORK: As independent contractors, US ride-hail drivers for Uber and Lyft benefited from soaring trip demand and flexible work hours.
But as the coronavirus brings large parts of the country to a halt, drivers and companies are facing the downside of an ambiguous contractor model. Many Uber and Lyft drivers depend on the companies, but under US labor law don’t have the protections granted to regular employees.
Under pressure to ease the plight of its roughly 1.3 million US drivers and food delivery workers, Uber has seized on the crisis to advance its campaign for a larger overhaul of US employment law to permit it to offer more benefits while maintaining workers’ contractor status, changes it has requested from state and federal lawmakers for several years.
Uber Chief Executive Dara Khosrowshahi on Monday urged US legislators to use the current crisis as an opportunity to implement changes to existing employment law by creating what the company calls a “third way” in between employment and contractor status.
A spokesman for US Senator Chuck Schumer on Wednesday said a massive federal coronavirus aid bill will include reforms to make unemployment insurance available to self-employed and gig workers, adding that more details would be presented throughout the day.
Uber’s proposal drew sharp criticism from labor unions. “A ‘third way’ is just a euphemism for creating a new underclass of workers with fewer rights and protections,” said Art Pulaski, executive secretary-treasurer of the California Labor Federation.
In a statement, Uber said economic forecasts meant more people will need flexible, independent work in the future, which was why it wanted to raise the standard for that work.
Uber’s original benefits plan did not include unemployment insurance, the protection drivers seek most under current circumstances. A driver advocacy group in New York on Tuesday called on Uber and Lyft to contribute to emergency unemployment pay.
Uber did not comment on the lack of unemployment insurance, saying only that its proposed model included “extended benefits for independent contractors.”
Lyft did not respond to a request for comment.
VULNERABLE GIG WORKERS
Demand for ride-hailing trips in recent weeks has declined by as much as 70% in some US cities and many drivers told Reuters they stopped driving over fears of getting exposed to the virus or infecting others. (Reuters)