Amazon makes a splash and joins the “gig” economy

Under the name “Amazon Flex“, Amazon has joined Uber and Lyft in the “gig” economy. According to the Amazon website, workers can choose any available 2, 4, and 8 hour blocks of time to work the same day, or set availability for up to 12 hours per day for the future. Like Uber, you can work as much or as little as you want. Amazon Flex is only available now in Seattle. Amazon promises it will be available soon in New York, Baltimore, Miami, Dallas, Austin, Chicago, Indianapolis, Atlanta and Portland.

Certainly Amazon’s big splash will put greater pressure on government agencies to keep up with a major labor force change that is underway. And, it may well be that the ever-increasing, federal government saber-rattling over the misclassification of workers as independent contractors is a response to this sea change. [See my economic realities post for example.]

Arun Sundararajan, a professor at New York University’s School of Business, made the following, salient observations in the Guardian:

Today, more and more of us choose, instead, to make our living working gigs rather than full time. To the optimists, it promises a future of empowered entrepreneurs and boundless innovation. To the naysayers, it portends a dystopian future of disenfranchised workers hunting for their next wedge of piecework.

His other comments are worth noting because they suggest an explanation for the growing number of entrants in this “gig” economy. See Arun Sundararajan, The ‘gig economy’ is coming. What will it mean for work?; but see Josh Zumbrun and Anna Luie Sussman, Proof of a Gig Economy Revolution is Hard to Find.

That said, a federal judge in California has recently allowed some drivers to proceed with a class-action lawsuit against Uber.  In that suit, Uber drivers want to be classified as employees — not independent contractors – because California law requires employers to reimburse their employees for expenses that are required to do the job. Thus, Uber would become responsible for most of the costs Uber drivers are currently bearing as independent contractors. The suit is a potential game-changer for Uber, but may also be a bellwether for this segment of the economy and any future litigation.

Amazon must not think so. For the rest of us, we will have to wait and see how this all settles out.

If you are an employer who has questions about employee vs. independent contractor classification, attorneys with the Sands Anderson Employment Practice Group are available to answer your questions and assist you with issues concerning this important issue.