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Labor Dept is proposing new rules that will have severe economic repercussions, and trying to hide them from you. And they're being fast tracked to approval while the public is distracted by COVID, the election, and now the SCOTUS pick also. Here's a synopsis. (1/x) https://twitter.com/SecGeneScalia/status/1308384374296064000
In short, Scalia wants to deliver one comprehensive gut-punch to undermine much of the fundamental labor protections that certain moronic fringe elements of the GOP have long claimed are too burdensome on the economy. Make most people independent contractors. (2/x)
To be clear, this goes FAR beyond Uber drivers. That's merely the vehicle (no pun intended). The goal is to, long term, make it easier for nearly all workers to be classified as independent contractors, thereby circumventing traditional employment regulations. (3/x)
In addition to simply reclassifying, Scalia wants to enable companies to pass the burden of operational costs to the bottom level "contractors", so the ICs can be forced to operate at net losses while the "employer" reaps windfall profits. (4/x)
The key detail that has normally made employees attractive for businesses is the ability to control the methods and nature of work being done, whereas ICs are supposed to control their own work flow, their pricing, the services they offer, etc. (5/x)
Normally, employers can control the minutia, while clients only get input on the big picture. Most companies want/need the added control of employees to ensure product quality, coordination of workers and compatibility of their results, and other things like that. (6/x)
Scalia aims allow that companies to exert the same degree of control over ICs' work, while also making it easier for those companies to stamp out ICs' few traditional protections, such as ability to set their own prices. "Employees" eventually become obsolete. (7/x)
Can't emphasized this enough:
This means YOU. Whatever your job, whatever you do, Scalia's goal is that YOUR job can be reduced to IC status, stripping you of all your benefits and protections. Very few jobs would be immune in the long run. (8/x)
This means YOU. Whatever your job, whatever you do, Scalia's goal is that YOUR job can be reduced to IC status, stripping you of all your benefits and protections. Very few jobs would be immune in the long run. (8/x)
Your local grocery store will no longer have employees, they'll have ICs to stock the shelves. The local car wash will simply be a shell company with a location where ICs do the work. No salaries, no hourly wages. Per unit prices for all. No breaks, either. (9/x)
Scalia wants the IC vs EMP question to hinge on an "economic reality" test. Which is to say, he wants the employer's version of reality. He also wants restrictions that companies contractually place (and enforce) on workers to be ignored in this "reality" test. (10/x)
The economic reality test would go something like this: Uber's payout to drivers is usually below drivers' operating costs. But in court, it's shown that the driver sometimes declined extra low fares. The "economic reality" is that the driver supposedly set his own rates. (11/x)
Another one: Uber contractually prohibits a driver from also running Door Dash orders while logged on. But after sitting around for an hour with no fares, a driver does it anyway. The "economic reality" is that the driver was *not* dependent on Uber to earn money. (12/x)
This will still be true, even if Uber subsequently terminates their relationship with the driver for violating their rules. Enforcing suppressive rules won't be "exercising control" over workers in Scalia's world. (13/x)
What you should notice in these examples is that Scalia's criteria would create mere illusions (defined by employers) legally dividing ICs from employees, paving the road to almost anyone eventually being classified as an IC. (14/x)
Hand in hand with all this is that ICs have no real permanence. Scalia's proposal argues that nowadays job tenures aren't as permanent as they used to be, so more workers should be able to be viewed as ICs, even for long term relationships. (15/x)
Scalia pretends to be elevating the status of ICs for their benefit, but in reality he's doubling down on their vulnerabilities, while dragging down and marginalizing employee status, so that corporations can gain better profits. (17/x)
To that end, Scalia's proposal seeks to redefine key concepts, such as the "integral" factor. Instead of looking at whether the work done is an "integral part of the business" operation, the issue would be whether the work is an "integral part of a production unit. (18/x)
Example of the relevance of this change: A teacher's work is not part of a broader "production unit," but it IS an integral part of a school's operations. Scalia's proposal would therefore allow teachers to be classified as ICs. (19/x)
Perhaps the most insidious aspect of Scalia's plans is to redefine labor as a capital investment for requiring even mundane knowledge. If you know how to mop a floor, and you mop the floor, you've invested human capital, and thus are an entrepreneur, not an employee. (20/end)
P.S. You can download the proposal here....
https://www.potusstaff.com/r/p/s/independent-contractor-rule-proposed.pdf
https://www.potusstaff.com/r/p/s/independent-contractor-rule-proposed.pdf
