New Ruling Could Allow Gig Workers to Unionize

The U.S. National Labor Relations Board recently ruled that some workers, formally treated as independent contractors, might need to instead be handled as employees, opening the door to unionization of gig workers, Reuters reports.

The board released a previous standard under former U.S. President Donald Trump’s administration that said workers who operate their own businesses should generally be considered independent contractors. Instead, according to Reuters, the Democrat-led board has reverted to a former U.S. President Barack Obama-administration standard, which considers more factors when determining a worker’s status, including the amount of control a company has over a worker and if the worker depends on just one company for income.

The origin of the ruling stemmed from a case involving a campaign by Atlanta Opera makeup artists and hairstylists to unionize. The board ruled that the workers were, indeed, employees of Atlanta Opera and, as such, had a right to belong to a union.

According to the article, the opera company can refuse to bargain with any union organized by the workers, which would bring the case back to the board and, eventually, to a federal appeals court.

Reuters also reports that the U.S. Department of Labor is expected to finalize a rule that would narrow the criteria determining a worker’s independent contractor status under federal wage laws. The proposal would require that more workers who are “economically dependent” on one company be considered employees, entitling them to more benefits and legal protections. When first announced in October 2022, stocks of gig companies Uber, Lyft, and DoorDash all fell roughly 10%.

In a released statement, Kristin Sharp, Flex Association CEO, said, “This decision will only generate greater confusion and uncertainty, while undermining the independent work that millions of Americans have chosen, often in lieu of traditional employment.”