Labor and Public Employees Committee
JOINT FAVORABLE REPORT
Bill No.: HB-6343
Title: AN ACT CONCERNING A STUDY OF GIG WORKERS.
Vote Date: 3/25/2021
Vote Action: Joint Favorable Substitute
PH Date: 2/18/2021
File No.:
Disclaimer: The following JOINT FAVORABLE Report is prepared for the benefit of the
members of the General Assembly, solely for purposes of information, summarization and
explanation and does not represent the intent of the General Assembly or either chamber
thereof for any purpose.
SPONSORS OF BILL:
Labor and Public Employees Committee
REASONS FOR BILL:
Since they are classified as independent contractors, "GIG" drivers do not receive benefits
given traditional job employees.
RESPONSE FROM ADMINISTRATION/AGENCY:
None submitted
NATURE AND SOURCES OF SUPPORT:
BEVERLY BRAKEMAN, REGIONAL DIRECTOR, UNITED AUTO WORKERS, REGION 9A
This bill ensures fair protections for gig workers. Certain types of gig workers such as driving
for internet-based food delivery or ridesharing services may be classified as independent
contracting because the work occurs outside of employers' physical locations. These
workers are not legally entitled to fair pay, family and medical leave, paid sick leave,
unemployment benefits, or workplace protections because they are misclassified as
independent contractors. By removing work outside of the office from the "B" portion of the
ABC test for independent contractors, it eliminates classification based solely on work
location.
RICHARD E. HAYBER, ATTORNEY, HAYBER, McKENNA & DINSMORE, LLC
The current law is bad because employers must pay employees minimum wages and
overtime pay. They must also pay into unemployment funds and provide workers
compensation insurance and abide by all employee rights laws including the NLRA and state
and federal anti-discrimination laws. These laws cut into employer's profits and force them to
treat employees with respect and fairly. For these reasons, they frequently misclassify their
employees as independent contractors. Our courts use what is known as the ABC test to
determine if an individual is an employee or an independent contractor. The 'A' prong is the
extent to which employers control the worker. The 'C' prong is the extent to which the
workers arer independently established in their trade or occupation. This typically means the
individual must have their own business and provide similar services for other companies.
The 'B' prong is the part being discussed which includes a loophole that harms remote
workers. They propose to eliminate part of the 'B' prong. This change would bring us in Iine
with other jurisdictions. In Massachusetts, the fact that you don't work a physical location
owned and controlled by the corporation is simply not an issue in determining employee
status. This is easy to follow. Employers and employees would know that you can be an
employee and work from home or on the road. They could still use independent contractors,
but only for work that is outside its usual course of business. It would make it easier for
courts to enforce the wage laws. It would protect gig workers from minimum wage violations.
Since taxpayers assume a greater obligation when employers dont pay their fair share, the
taxpayers would also benefit. They suggest eliminating part ii of Prong B from the ABC test.
This will bring CT in line with other states that care about their working class and create a
more prosperous economy.
STEVE KENNEDY, PRESIDENT, PEOPLE'S PARITY PROJECT UCONN LAW
Even before the pandemic, it was estimated that approximately 1-2% of workers rely on gig
work as their primary source of income. Since COVID19, our communities have come to rely
more on gig workers to supply day to day needs. When restaurants were forced to close
their doors and grocery stores saw severe restrictions, drivers for companies like GrubHub
and Instacart became lifelines for consumers and local businesses alike. CT should extend
the use of the ABC test to all employment determinations rather than only to unemployment
and wage hour claims. Classified as independent contractors, gig drivers are cut off not only
from unemployment and wage protections but also from workers' compensation, family and
medical leave, antidiscrimination and workplace safety protections, and more. The same test
should apply for all employees. Working some of the time in a physical location, they are
classified as employees, even though they are doing the same job as a driver for GrubHub.
These restaurants pay for unemployment and worker's compensation insurance which leaves
them at a disadvantage to the large out-of-state gig platform companies. It is time to
eliminate this carve-out for our out-of-state gig platforms from a law that already applies to
most of our local businesses and ensures many workers are fairly compensated and have a
safe work environment.
SAL LUCIANO, PRESIDENT, CT AFL-CIO
The past year has proven that improperly classified employees are taken advantage of by
internet-based food delivery and ridesharing companies. Employee misclassification is a
persistent problem in many growth industries and in the rapidly growing app-based "on-
demand" economy. The gig economy has been criticized for using technology to evade
worker protections such as rights to minimum wages and paid leave and healthcare. In
traditional jobs, workers may enjoy the benefits of trade unions. Employees within the GIG
industry are paid as independent contractors. While companies like Uber and Lyft make
profits, these workers often make poverty level wages. Gaps in federal and state laws have
left these workers without meaningful protections.
TIMOTHY PHELAN, PRESIDENT, CT RETAIL MERCHANTS ASSOCIATION
Many people require flexibility for many reasons, including children at home, elderly parents
needing help, and they are pulled in multiple directions and often need to seek creative
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alternatives to bring in income. This bill is a step in the wrong direction for people who
require the independence and flexibility independent contracting offers. This is putting these
jobs in jeopardy at the worst possible time, in the midst of a pandemic when lower earnings
and less flexibility is the last thing these people need or deserve. The reality is that
independent, flexible work is a critical and growing part of the economy and individuals in this
field prefer the status quo. This should continue to be an alternative choice.
NICOLE SANCLEMENTE, POLICY AND PROGRAM ASSOCIATE, CT WOMEN'S
EDUCATION AND LEGAL FUND (CWEALF)
Women, especially those of color, are overrepresented in low-wage jobs on the frontlines of
the crisis. Many of these occupations lack access to critical policies like paid sick leave or
paid family leave. Women are more likely to earn supplemental income and work part-time
compared to their male counterparts and are more likely to engage in multi-level or direct
marketing to sell goods online. These workers are the least likely to have access to benefits
or continue to get paid during a downturn. Single-mother households are specifically affected
during coronavirus-related closures. Non-traditional workers have proven essential during
the COVID-19 pandemic and are bearing the burden of inconsistent and outdated labor laws.
These workers are often classified as independent contractors and the gaps in federal and
state laws have left them without the meaningful protections offered by trade unions,
employer provided healthcare, minimum wages and other opportunities for growth and
sustainable employment.
SEIU HEALTHCARE
This would provide basic labor standards to a growing gig workforce. Times change and large
corporations figure out ways around the labor laws. This bill would make sure workers are
keeping more of their paychecks as well as extending DOL and basic NLRB protections. The
right to organize provides workers a voice and evens the playing field. They should not have
to fight for these types of protections. All workers should have the right to form a union. This
bill is a step toward recognizing the value and worth of all workers.
STEPHANIE THOMAS, REPRESENTATIVE, STATE OF CONNECTICUT GENERAL
ASSEMBLY
This bill recognized that policy has not yet caught up to the trends of the modern workplace.
Non-traditional full-time employment has grown almost 50% over the past decade. These gig
workers lack the protections offered to traditional workers. Given the changing landscape of
workplaces, several states are exploring ways to allow gig workers to pay into the UI program
so they can participate when the need arises. This would go a long way towards protecting
these key workers and lead the way in the nation on this subject.
NATURE AND SOURCES OF OPPOSITION:
CHRISTOPHER GILREIN, EXECUTIVE DIRECTOR, TECHNET
Technology makes it easier for people to work independently, run their own business, and
leverage their time and talents to generate supplemental income. The gig ad sharing
economies have provided low-barrier entry earning potential for millions of Americans. Many
in this modern, diverse, independent workforce find they get better financial returns on their
skills than their peers in the traditional workforce, and the freedom to work how and when
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they want is a crucial benefit. Perhaps more than ever, policymakers should be wary of
restricting or eliminating the ability of technology platforms to make independent flexible
earning opportunities available to all CT residents. Providing worker benefits should not be
the sole provenance of an employer who has control over when, where, and how work gets
done, nor should the growing dynamic independent workforce be denied protections and
benefits because they do not fit a narrow and often outdated definition of employment. The
problem is not that workers are incorrectly classified, it is that the statute presumes that there
are only two classes of work. Attempting to shoehorn a dynamic, ever-changing and growing
industry and its workforce into binary ad inflexible definitions of employer and employee via
legislation will not address the underlying issue that the way many people choose to apply
their skills and earn a living has changed dramatically since many of these statutes were put
in place. CT can design a system of benefits that is portable, flexible, and makes sense and
recognizes the diversity of the independent workforce and different business models.
ERIC GJEDE, VICE PRESIDENT OF GOVERNMENT AFFAIRS, CBIA
"Gig" economy jobs, like app-based delivery and transportation network companies, are
creating economic opportunities for thousands of individuals in the state. Citizens are
choosing these economic opportunities over traditional jobs because they can be their own
bosses, capable of setting their working hours to meet the flexibility needs of other jobs,
classes, or familial commitments. Gig economy jobs allow individuals to earn hundreds of
millions of dollars every year and fill an important niche in the economy. They allow
individuals subject to social distancing and quarantine requirements the option to have food
and medicine delivered and provide alternatives to mass transit transportation, which also
helps support small local restaurants and businesses. They encourage the creation of
beneficial alternative business models used by these companies rather than unnecessarily
regulate them.
JOHN OLSEN, DIRECTOR, STATE GOVERNMENT AFFAIRS, NORTHEAST REGION
They oppose this bill because it would fundamentally change how internet companies
provide needed economic opportunities to residents and businesses struggling to survive in a
pandemic world. It would cause significant economic hardship for numerous businesses
already struggling to maintain a workforce and continue operating during the COVID
emergency. This bill attempts to reclassify a workforce that overwhelmingly prefers to remain
independent contractors. Flexibility and the ability to work across multiple platforms has
enabled many residents to supplement their incomes. Because of the pandemic, traditional
employment remains a challenge and more people are forced to work from home.
Reclassifying these jobs would dramatically curtail the services offered by internet platforms
and make food ordering, delivery, and ridesharing more expensive and less frequent. This
reduces demands and limits restaurant revenues and earning opportunities for thousands of
current and potential delivery workers.
DAVID LONDON, HEAD OF GOVERNMENT RELATIONS, US EAST, DOORDASH
As cities and states have issued guidance restricting the operations of restaurants and other
businesses during the pandemic, delivery and pickup services have been critical to reducing
person to person contact and ensuring that residents have access to food and other
essentials. Their testimony cited many things they did through organizations to help during
the pandemic. This bill would significantly alter the flexibility their Dashers need. As
independent contractors, they enjoy the flexibility to earn supplemental income by working
whenever and wherever they want to accommodate their existing work, family, school and
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other obligations. This is not the time to make sweeping changes. Upending this system that
is bridging the gaps would not be a wise move in these uncertain times. Restricting the way
third party companies operate within the state will only hurt residents that choose
opportunities that provide flexible, on-demand work they can engage in on their own
schedule.
HAYLEY PRIM, PUBLIC POLICY MANAGER, UBER TECHNOLOGIES, INC.
The testimony cited the important part these drivers and delivery workers play during the
pandemic and the contributions they made. Anyone who passes the background check and
meets the regulatory requirements to work as a driver or delivery person can use the Uber
App. There is no minimum commitment or obligation. Drivers provide their own vehicles and
are responsible for the costs of running their business. In CT, 43% of these drivers/delivery
people work fewer than 10 hours a week. Drivers value the independence and freedom
associated with being their own boss. If this bill was passed, it would force thousands of
single parents, college students, retirees and those whose traditional employment has been
eliminated due to COVID to seek different jobs. Accessibility and flexibility provide immediate
and sustainable earning opportunities. Research has shown that people with these jobs want
to remain independent contractors. The gig economy is not perfect, but the current
employment system is outdated and unfair. This bill could cause large swaths of the
population to lose access to reliable, affordable transportation and access to critical services
like food and medical deliveries.
Reported by: Marie Knudsen, Assistant Clerk Date: April 5, 2021
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