While some in Silicon Valley indulge in free meals, laundry service and egg freezing, an estimated 50 percent of the workforce won’t even have basic benefits by 2020 — and Virginia Senator Mark Warner wants to do something about that.
While legislators in Washington state have proposed a bill requiring a benefits program for gig workers, Warner has just proposed the first-ever piece of national legislation aimed at helping on-demand and other non-traditional workers without traditional benefits, like paid sick days or a retirement plan, have some sort of a safety net. The bill asks the federal government to set aside $20 million in funding for organizations to use to look at the types of benefits programs individual workers could take with them from job to job.
Set aside the current talk up on the Hill of taking away healthcare from millions of people for now. Thanks to mobile technology, 1099 workers have become a large (and growing) piece of the economy, set to reach half of everyone in our nation in just a few years — a staggering number to go without any sort of a plan for anything. However, these portable benefits plans would give the nice lady who just brought you a burrito for lunch, the kid who cleaned your house or the guy who dropped you off at work this morning options in helping them continue paying bills and take care of themselves should something happen.
“[Portable benefits is] that emergency fund,” Warner told BuzzFeed, which first reported news of the bill. “It might be a fund to take care of a disability if you get hurt. It might work with some existing retirement programs. Part of it would be, depending on what happens with Obamacare, an ability to help deal with health care expenses. I think there will be a variety of models.”
The funding wouldn’t be enough to cover everyone, of course, but if it gets the green light a draft of the bill indicates it would earmark $5 million toward grants doled out by Labor Secretary Alexander Acosta for organizations already looking into portable benefits and $15 million for new programs.
The bill already seems to have broad support, including from the former Labor Secretary Robert Reich, as well as such organizations as the Independent Drivers Guild (IDG), which represents about 50,000 ride-hailing drivers for startups like Uber and Lyft. “Gig economy workers and their families need benefits and protections just like traditional employees. Unions and government officials must not let these workers fall through the cracks,” an IDG spokesperson told TechCrunch.
Uber and other startups using the on-demand working class for labor also seem to support the idea of providing gig workers with some sort of a safety net, at least. Uber, for instance, just raised its rates in eight states by five cents per mile to cover the cost of injury insurance for its drivers, though that could be more to cover itself from lawsuits. We’ve reached out to hear how Uber, Handy and others feel about the newly proposed nationwide portable benefits legislation as well.
Many of these same startups have tried in the past to separate gig workers into a new class separate from 1099 workers who might also employ others, but that, so far, hasn’t gone anywhere. Senator Warner has also been thinking of the gig worker and the major shifts we’ve seen in employment over the last few years, thanks to technological advances. His bill doesn’t classify them as something new, but would at least be the first step into research on how to go about providing for these working Americans in what is already an enormous shift in the way many of them now make a paycheck.