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Etsy Proposes New Kind of Employment Status

Employment Status

Earlier this month, executives from the giant online arts-and-craft website Etsy.com went to Washington to urge changes to how artisans, entrepreneurs and other independent workers are treated.

Etsy hosts the online stores of some 1.4 million independent artists and crafts people from across the country, making it easier for them to sell their creations.

The company has just published a white paper—“Economic Security for the Gig Economy: A Social Safety Net that Works for Everyone Who Works”—that urges legislation to help independents handle the complexities of being in business for themselves.

The paper heralds the emergence of an entirely new classification of worker that falls somewhere between contractor and employee.

If the idea catches on, it may wind up being equally valuable to workers and employers alike. Unhappy independent contractors often covet the benefits that employees enjoy—real, tangible, valuable benefits such as overtime pay, paid time off, health insurance coverage and so on.

That envy has spurred many a class-action lawsuit, creating costly headaches for many an employer.

Plus, various state and federal agencies regularly launch aggressive efforts to challenge independent contractor status.

Etsy’s proposal would augment the ethos of the gig economy—think Uber drivers and TaskRabbit assistants—solidifying the permanent creation of a third class of workers with limited rights to negotiate better livelihoods as a group. It’s akin to unionizing, with a nod to the Old World tradition of craft guilds.

Etsy’s approach advocates the creation of a federal marketplace much like the Affordable Care Act marketplace for health insurance that would allow sellers to buy benefits the way employers do. Benefits might include retirement savings accounts, group health care plans, disability insurance and so on.

If independent contractors can access the perks they seek outside a formal employment context, fewer might feel desperate enough to litigate access to those benefits.

Download Etsy’s white paper “Economic Security for the Gig Economy.”

Could this change have an impact on your business?

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References: by THE HR SPECIALIST on NOVEMBER 7, 2016 9:00AM