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  Republican candidate Jeb Bush, eager to demonstrate his support for business and innovation, simply tweeted a photo of himself in an Uber.

  Democratic senator Elizabeth Warren, long a proponent of strengthening the government-provided safety net, finally won headlines for the position after pairing it with the gig economy. “The much-touted virtues of flexibility, independence and creativity offered by gig work might be true for some workers under some conditions,” she said in a speech at an annual conference for the New America Foundation in Washington, “but for many, the gig economy is simply the next step in a losing effort to build some economic security in a world where all the benefits are floating to the top 10 percent.”21

  The speech wasn’t exactly about the gig economy: “The problems facing gig workers are much like the problems facing millions of other workers,” Warren noted. But the headlines were definitely about the gig economy: “Elizabeth Warren Takes on Uber, Lyft and the ‘Gig Economy’”;22 “Elizabeth Warren Calls for Increased Regulations on Uber, Lyft, and the ‘Gig Economy’”;23 “Elizabeth Warren Slams Uber and Lyft.”24 In her speech, Warren had acknowledged that talking about TaskRabbit, Uber, and Lyft was “very hip.” It seemed she was right.

  Sometimes politicians and labor leaders didn’t even need to frame their positions within the context of the gig economy to have them interpreted that way. The media did it for them. When the Labor Department’s Wage and Hour Division published new guidance on worker classification in July 2015 (which would later be rescinded by the Trump administration), it did not mention Uber. Invariably, mainstream media coverage of the memo did.25 Never mind that, as a US senator in 2007, President Obama had introduced legislation that proposed closing a loophole employers used to classify their employees as contractors. Or that David Weil—who had dedicated the most recent portion of his career to studying the breakdown of the employee-employer relationship outside of Silicon Valley—was now the administrator of the Wage and Hour Division. This was about Uber.

  The Economic Policy Institute (EPI) had written briefs about the need for changes in policy around the contingent workforce as far back as 1991. Now it framed these themes in the context of the gig economy.26 “The really big picture is, this is part of a trend in the declining labor share of the economy,” EPI president Lawrence Mishel told me. Was it frustrating that the first time I’d called him was to talk about Uber? Probably. Mishel also bylined an exasperated op-ed for The Atlantic in which he argued that “dwelling on these companies too much distracts from the central features of work in America that should be prominent in the public discussion.”27 Another way to look at all this dwelling on Uber’s business model, however, was as a tool for making these very central features of work more prominent.

  By October 2015, the debate around the gig economy had gained enough momentum that President Obama made it a topic of discussion at a White House summit of union leaders, economists, and employers. Perched on a wooden stool during a question-and-answer session, the president noted the gig economy’s wider significance: “The on-demand economy or the share economy is still a fraction of the overall economy,” he said, but “someone in the on-demand economy is just one end of this broader spectrum of changes that are taking place across the board. We need to make sure workers across sectors understand that their fates are connected. They can’t think, ‘Ok, I’m in a union in a factory with a traditional contracted pension, and so I don’t have to worry about what is happening to that worker over there.’ Because the same problems that they’re dealing with, you may eventually be dealing with.”28

  As with anything related to changes wrought by the tech sector, the “future of work” panel circuit boomed. (“I want to start a conference about the ‘present of work,’” joked Managed by Q’s Dan Teran, who made frequent appearances.) Moderators wanted to know: As the full-time job became less standard, how should our policies change? How could workers be heard in a company that did not claim them as employees? Could the idea of a good job transfer to a good gig?

  The gig economy helped reinvigorate a conversation about security that had been ongoing for decades. Labor organizers in both nontraditional and traditional workers’ advocacy groups contributed new ideas about what collective action could look like in the new world of work and how benefits should be arranged. Politicians made cautious statements about how the dissolution of the direct employment relationship should impact policies.

  Harder to spot than the endless panels were the small actions that these types of conversations produced. But they were there, if barely: The Freelancers Union had been campaigning since 2011 for the federal government to reinstate its survey of the contingent workforce, which it had abandoned after budget cuts in 2005. Obama’s secretary of labor, Thomas Perez, finally promised to do so, noting that “the on-demand economy raises important questions about how to continue upholding time-honored labor standards and how to promote economic security for American workers in a changing labor market.”29 (The department conducted the survey in May 2017.)

  An unlikely group of collaborators, meanwhile, came together to advocate for the same type of benefits that Warner would propose in his bill. The collective included business executives at companies like Lyft, Etsy, Instacart, and Handy; academics; venture capitalists; the leader of a Service Employees International Union (SEIU) branch; and representatives from untraditional organized labor like the National Domestic Workers Alliance and the Freelancers Union. In November 2015, it produced an open letter in support of “portable benefits.”

  Portable benefits are social insurance programs that aren’t tied to an employer but rather move with workers from job to job. In the United States, Social Security is one example of a portable benefit. Multiple employers pay into a worker’s fund, and when the worker moves jobs, they don’t lose the benefit. Healthcare, paid sick days, and other social insurance could, the letter proposed, work in a similar way. Though the letter was short on details, the broad coalition vaulted the phrase “portable benefits” into the Wall Street Journal, New York Times, and Washington Post.

  When Phyllis C. Borzi, Obama’s assistant secretary for the Employee Benefits Security Administration, US Department of Labor, spoke at the Aspen Institute months after the White House summit at which Obama had spoken, she commented on the change. “There’s been a lot of focus on retirement benefits and security, primarily because of the focus on the on-demand economy,” she said. “And that’s a good thing, that we’re focusing on this, because it’s possible that with a new set of characters and a new impetus to look at this issue, we might be able to actually get something done.”30

  * * *

  Restructuring benefits was one of the ideas for mitigating the insecurity inherent in the gig economy. The other was to restructure employment categories.

  Former deputy secretary of labor Seth Harris and Princeton economist Alan Krueger summarized the case for a new category of “independent workers” in a December 2015 policy paper for the center-left Washington think tank the Brookings Institute. Gig economy relationships with workers, they argued, don’t look like traditional contractor relationships. Uber drivers and Handy cleaners accept whatever rates and terms of service the company sets. But workers in the gig economy also choose when to work, and work for multiple companies at the same time. “Their relationships with intermediaries are not so dependent, deep, extensive, or long lasting,” Harris and Krueger wrote, “that we should ask these intermediaries to assume responsibility for all aspects of independent workers’ economic security.”31

  Their solution was one that other countries had already adopted: a third employment category between employees and independent contractors. As they envisioned it, this third category of workers would allow gig economy companies to purchase and administer certain benefits for workers without worrying about providing evidence of misclassification. It would also give companies the choice to opt in to payments for some types of protection programs, like workers’ co
mpensation insurance.

  Inherent in proposals like this one was the idea that the work gig economy companies provided was valuable and worth protecting. And to some workers, companies like Uber really did provide a safety net of sorts. As one driver, former San Francisco Chronicle journalist John Koopman, explained: “When you’re falling straight down the financial cliff face, you reach out to grab hold of anything available to stop your descent and there, just before you land in a homeless shelter or move in with your sister, is Uber. I think of Uber as a modern-day version of the Works Progress Administration during the Depression. Thanks to Uber, I am not poor. I am just … nobody.”32

  A new “independent worker” category offered something to all parties involved. Companies like Uber would not need to totally revamp their business models, because they wouldn’t commit to the full cost and liability of hiring employees, and their workers would have more rights and protections. The authors of the Brookings Institute report even got a little poetic about it, asking readers to imagine a tent: “With only the two poles, the middle of the tent will flap sloppily in any reasonably strong wind. But the introduction of a third pole to hold up the middle of the tent will reduce the flapping and give more shape to the tent, even if the tent is not perfectly taut.”33

  Union leaders were not moved by the metaphor. “The AFL-CIO Executive Council affirmed that working people in the gig economy share a single common designation: employees,” the largest federation of unions in the United States wrote on its blog four months after the Harris and Krueger paper was published.34 Above an excerpt of the statement on its website, the union posted a graph with three lines over time. One showed productivity, angling up and to the right. The other two represented average hourly compensation as estimated in two different ways, with both lines leveling off around 2005. There was no attempt to link the image to the text of the statement, but the point was clear: Companies are getting richer, and workers aren’t. The AFL-CIO believed a third category of workers would enable, not hurt, this trend.

  In countries that have introduced a third category of workers, the addition hasn’t ended the conflict between wanting to control workers and wanting to classify them in a more independent, less expensive category. In London, for instance, the question of how to classify Uber and Deliveroo workers has been hotly debated. When an employment tribunal in 2016 ruled that Uber’s drivers were not self-employed, as they’d been classified by the company, but were “workers” entitled to holiday pay, paid rest breaks, and the national minimum wage (Uber appealed the decision), General Secretary Frances O’Grady told the BBC: “For many workers the gig economy is a rigged economy, where bosses can get out of paying the minimum wage and providing basics like paid holidays and rest breaks … We need the government to get tough on sham self-employment.”35 It was not so different from arguments that gig economy detractors have made in the United States, where no third category of workers exists.36

  Critics of the UK’s in-between worker category, as well as similar categories in Italy, Spain, and Canada, often argue that these classifications just intensify the problem: that with another option between employees and independent contractors, employers find more loopholes for opting out of the laws and benefits associated with traditional employment. Still, the idea of creating a new type of employment category in the United States gained some support.

  Handy’s political PR firm eventually helped draft state legislation that combined a version of this idea with portable benefits. According to a draft Handy circulated for discussion in 2016, companies under the proposed law could elect to contribute a portion of each transaction to an on-demand worker’s benefit fund—which he or she could put toward benefits like life insurance and dental care—and, as a result, be certain the workers would remain independent contractors. The independent contractor classification would apply to even work done previously for the company, essentially removing Handy’s risk of misclassification lawsuits.

  Hiring employees can cost 20% to 30% more than hiring independent contractors. Social Security and Medicare payments alone cost 7.65% of a worker’s pay. By comparison, Handy had proposed companies divert at least 2.5% of worker pay into a worker benefit account. Those who opposed the plan worried that it would look to some on-demand companies like a bargain; that it would allow them to classify workers as independent contractors (albeit, independent contractors who had access to small benefits funds) when they would be more properly categorized as employees, who have more rights and protections.

  Others who signed on to the idea of “portable benefits,” the same term Handy used, had very different ideas about what they would look like. David Rolf, a vice president of the SEIU, writing with venture capitalist Nick Hanauer in Democracy, laid out his specific plan: “Mandatory accrued benefits should include a minimum of five days a year of paid sick leave, 15 days a year of paid vacation leave, a matching 401(k) contribution, and the same health insurance premium contribution as currently required under the Affordable Care Act (ideally, healthcare would fall into the insurance benefit category, but that is a larger battle).”37

  In this version, contributing to independent contractors’ benefits would not be a choice. Benefits would accrue to all workers regardless of classification. If someone worked 20 hours for one employer, that employer would pay half of the benefits to which someone with a 40-hour full-time job would be entitled. Other employers for whom that person worked would pay into the same account.

  Further disagreement existed even among people who shared this vision. Who would handle these accounts? Employers? Third-party startups? Non-profit organizations? Some argued that this could be the role of unions in the twenty-first century. The Screen Actors Guild, for instance, had a benefits fund for actors who typically work on project-based gigs with multiple employers. The only problem with using the same system in the gig economy was that the law that enables this type of account, called Taft-Hartley, only applies to traditional unions. You can’t set up a Taft-Hartley plan if you’re not a union. And you can’t form a union with independent contractors. “All we have to do is create a classification of provider that could operate outside of Taft-Hartley,” Rolf told me.

  Few of the debates around additional worker classifications or portable benefits resulted in concrete outcomes. Two years after Harris and Krueger proposed a third category of workers in the United States, the idea had largely faded from discussions about the future of work. Two years after Handy circulated a draft of the New York state bill, it still had not made it to the legislative docket. Other attempts at starting portable benefits programs had proven just as slow. Senator Warner’s proposed $20 million fund for portable benefits pilot programs hadn’t yet made it out of committee. A small $100,000 grant program for experiments with portable retirement benefits savings plans introduced by the Department of Labor38 had given awards to three projects, but only one was even in the prototype stage of its exploration (the other two used the grants to conduct research on the barriers that low-wage workers faced in saving for retirement).

  On panels about the future of work, nearly everyone could agree that the current social safety net and worker classification systems were no longer adequate. But actually implementing changes—which would require parties with different political agendas to compromise on specifics, experiments that proved feasibility, and passage through a slow law-making process—was more likely to take decades than years.

  PART V

  THE FUTURE OF WORK

  CHAPTER 12

  PIVOT

  In the spring of 2016, Managed by Q leased a new office in a New York City skyscraper. The company had grown from 150 to 500 employees in the last year, and its previous home in the East Village, in a five-story building with a rickety elevator that featured exposed brick walls, could no longer accommodate enough desks. This new office by comparison looked like a huge corporate office. Or, at least, it would once the company moved in.

  Eventually Managed by Q wou
ld install glass walls to create conference rooms, purchase desks and chairs, and strategically place plants to add a pop of color throughout its new office. It would install a receptionist desk formed in the shape of a “Q.” But on March 18, the day of the startup’s first formal press conference, no furniture or walls had yet been installed, and the floor was still unfinished. Managed by Q was working from a temporary space on another floor. Its permanent office looked as though someone had moved the basement 11 stories into the air—it was a vast cement cave, empty except for a catering table filled with coffee and croissants, several rows of folding chairs, and a podium.

  Dan Teran nervously approached the microphone, flanked on one side by Ty Lane, one of Managed by Q’s first operators, and on the other by Thomas Perez, the secretary of labor of the United States. Standing behind the rows of seated reporters were his friends, including his cofounder, Saman.

  Saman had started a new company shortly after leaving Managed by Q. But he was proud of what he and Dan had started, and he found it astonishing that what had begun as two guys thinking about residential buildings in Park Slope and Williamsburg had so quickly turned into a large company with a mission that interested the secretary of labor.

  Dan began his speech: “When we were just starting out a few years ago … We looked at the tech companies around us that were increasingly looking at labor as a cost and not an asset…” As he spoke, he lightly tapped his foot on the floor. A handful of reporters tapped on their laptops. “As the secretary will tell you, that’s what leads to bad jobs, stagnant wages, and unmotivated workers. It’s bad for workers. It’s bad for customers. And it’s bad for business. So we took a different path. Instead of shirking our responsibility as an employer, we [leaned into it]. In order to provide the best service, we need the best people for the job. And in order to attract the best people for the job, we need to be the best employer. So that’s what we set out to do, and that’s what we’re after today.”