Analysis: U.S. Labor Secretary's next move on gig workers likely to include company probes - experts

Marty Walsh wearing a suit and tie: FILE PHOTO: Secretary of Labor Marty Walsh speaks during a news conference at the White House in Washington © Reuters/ERIN SCOTT FILE PHOTO: Secretary of Labor Marty Walsh speaks during a news conference at the White House in Washington

By Nandita Bose

WASHINGTON (Reuters) - U.S. Labor Secretary Marty Walsh's move this week to block a rule making it easier to classify gig workers as independent contractors is just a first step in what is likely to be a long battle over how to delineate the rights of America's growing gig army.

Marty Walsh wearing a suit and tie: Secretary of Labor Marty Walsh speaks during a news conference at the White House in Washington © Reuters/ERIN SCOTT Secretary of Labor Marty Walsh speaks during a news conference at the White House in Washington

The rule by former President Donald Trump's administration, which was supposed to go into effect in March, would have hampered the ability of workers at companies like Uber and Lyft to demand benefits like overtime pay.

The Labor Department, under Walsh's leadership, is now likely to investigate how the pay and benefits gig workers receive stand up against the federal law protecting American workers, the Fair Labor Standards Act, labor lawyers, unions and former policy makers said.

Walsh, himself a former union member, told Reuters he thinks a lot of U.S. gig workers in the country deserve employee benefits, and that his department would have conversations in coming months with companies that employ them.

"These companies are making profits and revenue and I'm not (going to) begrudge anyone for that because that's what we are about in America. But we also want to make sure that success trickles down to the worker," he said last week.

The department's roadmap is likely to start with announcing its intent to look at worker misclassification and then using probes to build the case for a ruling that supports protections for workers.

Any ruling would have to be reviewed by the White House and be subject to a public comment period, which could take as long as 90 days.

If the department issues a ruling, millions of gig workers could become eligible for benefits like overtime and a minimum wage.

That would almost certainly be the beginning of a battle in Washington as well as state legislatures and courtrooms across the country, the experts told Reuters.

Walsh's position is reinforced by the FLSA as it currently stands, said Erin Hatton, an associate professor at the State University of New York at Buffalo who specializes in workforce inequities, with a focus on labor markets and the gig economy.


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Analysis: U.S. Labor Secretary's next move on gig workers likely to include company probes - experts