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The Changing Gig Economy

For the last several years there's been both excitement and concern over the gig economy that seems to be growing by the day, as it starts to become the norm for more and more workers. With the explosion of companies like Lyft and Postmates, many more companies have come onto the scene. However, of late, recent news has indicated that the gig economy that is bringing a change to the way people work is still undergoing change itself.

One major event happened in California with the State's Supreme Court altering the way workers are classified for independent contractor purposes. This decision, Dynamex v. Superior Court, makes it much more likely that workers at places such as Lyft and Postmates will be found to be employees rather than their current treatment as independent contractors. This could create a sea change in the way these companies operate and could in part alter the new gig economy itself.

Another issue hitting these companies is one that also impacts most other business in 2018: data security. Uber, for example, recently hired a former NSA general counsel as its chief security officer. While data security concerns impact all companies, businesses such as Uber maintain an incredible amount of personal information on both their workers and their customers. When a security breach occurs, like the one that hit Uber in 2016, it has massive ramifications for everyone. This is yet another issue that gig economy business must adjust to.

Finally, the very idea and realities of gig economy work are leading to the emergence of new companies stepping in to fill newly created gaps for the American worker. For example, gig economy workers find themselves completely on their own when it comes to healthcare and other benefits. Is there a way to provide these workers with some security? New companies, such as Trupo, think so. Trupo allows freelancers to purchase various coverage in the range of $20 to $50 per month and also allows them to sign up on month-to-month contracts.

While there has been much focus on how the gig economy is changing things for workers worldwide, we should also keep note of the way the gig economy itself is changing. We may indeed be moving to an economy where more and more people are working as freelancers but the way that looks for any given worker is still very much a work in progress.

Companies seeking to understand and succeed in this changing environment for companies should include sound legal advice from experienced business attorneys in their planning.

Larson & Gaston, LLP

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