I get what you're saying, but I don't think "setting their own rates" has anything to do with it. Any driver would be able to set their own rates by going at it alone, completely independent from a ride share company. They would create their own service and charge what they want.
However, because the drivers choose to participate in the Uber/Lyft marketplace and benefit from the network affects that they have created, it follows that Uber/Lyft would have a say in the cost of goods sold in that marketplace. Just because the drivers can't set their own rates doesn't mean they aren't independent contractors.
If I hire you to mow my lawn, we mutually come to an agreement of what time and price you would perform the service. Just because you want to work for $100 / hour doesn't mean I'm willing to pay that. And because I'm only willing to pay a certain price only for your services doesn't make you an employee.
I think it's that simple. Uber/Lyft have a price they are willing to pay for services. They even allow their drivers to pick their own schedule (unlike my lawn service example). Drivers are not setting the price directly with the customers, they are getting paid by Uber/Lyft, but that doesn't make them employees.
In your lawn care example you used the word "mutually". That is a difference between the Lyft/Uber relationship with drivers and your relationship with the lawn care contractor.
Maybe if Lyft/Uber allowed drivers to bid on rides drivers would become more contractor-esque? But then the latency would be much higher for users. The system would likely also regress to the proposed price, as well, since drivers would likely just accept the price proposed by the platform to save time.
You are expecting that Uber/Lyft creates an "auction" environment in order for their drivers to be considered contractors? In my world view, an auction is not requirement for a driver to be considered independent. Drivers can:
- drive on their own schedule
- drive for competing ride share services (concurrently even)
- drive for themselves
- not drive at all
Seems very independent contractor. Uber/Lyft created a marketplace; drivers are agreeing to drive within the constraints of that marketplace. They can also create their own customer relationships and ride share marketplace if they choose.
If Uber/Lyft imposed restrictions on things like who a driver could give rides to or restricted concurrent ride share engagements, then that starts to feel like an employee. Rates have very little to do with it, in my humble opinion.
Part of the whole argument is not only whether drivers are technically employees or contractor but also whether Uber/Lyft are stretching those category so much that neither is a good fit for the situation.
As far as I understand one of the problems is that the drivers' market is so saturated that both Uber and Lyft can act as if they where monopolies (or maybe monopsonies). They can technically move to a competitor but that applies no pressure on the market.
Again, what makes this situation tricky is that it is essentially creating a new kind of employement-like relationship that current laws and regulation do not really account for.
This is only true if either company ever risk running out of (good) drivers. As I understand it currently there are more workers than jobs, so if a driver decides to cut ties with one of the oligopsies they are unable to get the same amount of work from the competitor.
So: "moving to a competitor definitely applies pressure" -> true; "keep both companies in check" -> false
There are not more workers than jobs, ive worked in the industry and this is a fact. Workers on ridhailing platforms come in varying levels of quality and amount of hours they can supply
You are thinking too much about just workers, when actually the smalelst divisible unit is hours. There is portion of drivers that barely ever switch, and then there is another portion that are constantly looking for the better deal, switching through outh the day. Its a scale.
So to keep drivers happy and on your paltform, you need to implement bonus schemes or have certain base pays.
Im not sure why so many people feel that they can comment on how the ridehailing platforms work without having any real experience in driving for them or working for them.
Your argument is right in principle, but it hides a proving-too-much fallacy.
By a similar reasoning one could claim that waiters/factory workers should also be independent contractors. If they don't like the pay in one business they can go work in another marketplace.
By this contrived example I mean to say that your analysis applies only to the superficial structure of the concept of employment. Ultimately social structures are not axiomatic field and should be treated accordingly.
Interesting that you picked "mow my lawn" as an example.
In California, gardeners are considered employees. The only reason most people don't have to deal with employment taxes, payroll, insurance, etc., is because they typically hire gardening companies that actually employ the workers.
Yeah - and admittedly I don't know California law at all. So it could very well be the State of California looks at this differently than other states and possibly different than the IRS, which might be throwing me (and maybe others) off.
> "However, because the drivers choose to participate in the Uber/Lyft marketplace and benefit from the network affects that they have created, it follows that Uber/Lyft would have a say in the cost of goods"
I can participate in Ebay / Amazon marketplace, and I can set any price I want if I decide to sell my TV there.
They take their commission, and provide some conflict mediation.
However, because the drivers choose to participate in the Uber/Lyft marketplace and benefit from the network affects that they have created, it follows that Uber/Lyft would have a say in the cost of goods sold in that marketplace. Just because the drivers can't set their own rates doesn't mean they aren't independent contractors.
If I hire you to mow my lawn, we mutually come to an agreement of what time and price you would perform the service. Just because you want to work for $100 / hour doesn't mean I'm willing to pay that. And because I'm only willing to pay a certain price only for your services doesn't make you an employee.
I think it's that simple. Uber/Lyft have a price they are willing to pay for services. They even allow their drivers to pick their own schedule (unlike my lawn service example). Drivers are not setting the price directly with the customers, they are getting paid by Uber/Lyft, but that doesn't make them employees.