Thursday, August 28, 2014

Shouldn't Uber and Lyft be employers of the drivers

I was surpised to find out that UPS pays its drivers about $28/hr + excellent benefits . Looking around in forums to understand the rate, given that it would appear to me that the requirements for a UPS driver aren't very different from a Lyft $15/hr driver (and the lyft has to pay his car out of that...) ... and the only good explanation I found what that UPS is an employer of  300K drivers the drivers have union-ized and the union has significant leverage to negotiate a great package for what appears to me (based on the Lyft comparison) a profession that someone with minimal training (like the uberx/lyft drivers can do). (I may be doing a mistake here : even though lyft driver carries a human (with all the responsibilities that this entails while UPS carries "boxes".... the issue here is that the UPS driver carries 100s or 1000s of boxes... which multiplies the responsibility in the same sense a bus driver should be paid more than a taxi driver and a train driver should be paid more than the bus driver even his role on the train is much simpler than the bus driver..... ).
Anyway my realization here is that Lyft and Uber have a significant challenge in the future to avoid having their drivers be independent contractors as opposed to employees (which could result in the potential union-effects...). The problem here is that uber and lyft want/need to control the experience , ie how the work is performed. They are telling the drivers when to work, where to go, they are training the drivers, they are training drivers to become trainers they are giving them tools ( apps , mustaches for now, maybe more later) the provide insurrance for them... and with each one of these efforts they check more and more of the checkboxes that when checked risk making a relationship be considered employee-one instead of a contractor one...

My view about the unions is that (in todays world and in US) they are not bad and they are not good either just like a company is not good or bad. There is nothing wrong with a group of vendors or customers or contractors or employees group together to create an new entity to create economies of skale, share risk obtain negotiation leverage. What is questionable (p.c. word for wrong) is that most countries/states have laws consider unions as "good" and they protect them. These laws were meant for the time that unions played an essential"good" role as an equalizing force (against all-too-powerfull employers) to fill the gap of then missing or unenforced laws and govermental protection.

Someone (not me :-) ) could make the more militant argument that we need to start thinking of applying anti-monopoly laws to limit the power of unions.
If all the fork-lift operators in a country unite into a union (think company) and goverment requires fork-operator licenses to operate a fork lift then the fork-lift operators inc has a monopoly ... and will most probably abuse it to benefit its members/owners so the goverment has to intervene and "regulate" that union or break it up all together, and if the broken up unions talk among thesmelves to keep rates up , the price fixing laws can be applied.

1 comment:

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