Gig financial system reckoning spreads to fashionable dwelling companies firm

Demiraiakian, who does furniture assembly and artisan work, said she was once tasked with allegedly removing small tree stumps only to find out that it would require much more powerful tools than she brought with her – information she says she doesn’t were forwarded to her until she got to work. After trying to remove the stump anyway, she left with not only a collection of defective tools that she estimated to cost $ 500 and would have to replace herself, but also with her salary if she left the job early. (A cell phone spokeswoman said Demiraiakian had been paid in full for the job in question. When asked about the discrepancy with Demiraiakian’s account, which she also submitted as part of a legal statement, the spokeswoman declined to comment.)

She says she was charged $ 50 for canceling jobs after learning they were 100 miles away (cell phone customer service said she was charged for “walking away from a booking within the penalty time.” “; the company does not cover the transportation costs for the jobs employees under their policy) who were not reimbursed for the additional time they spent completing tasks because a customer customer did not adjust the booking times and sexual harassment on Workplace has experienced. But she always comes back when she needs to.

“When money runs out, I know I can find a job or two on cell phone,” she told CNN Business. “I don’t know much to expect.”

Handy may not have received as much attention as on-demand counterparts like Uber, Lyft, and DoorDash, but it emerged in the same age and has a similar business model. Handy was founded in 2012 and later acquired by Angi, the parent company of Angie’s List (now also known as Angi). The company relies on a workforce of independent contractors in hundreds of cities across the United States. As contractors, these workers largely lack the basic legal protections that workers are entitled to, including minimum wage, compensation, paid sick leave and sexual harassment prevention training.

In the latest example of broader billing in the US via the gig economy, several major cities are questioning how cellphone classifies and treats workers like Demiraiakian.

In a letter this week to Oisin Hanrahan, co-founder of Handy and CEO of Angi, Workers in Philadelphia, Seattle and Chicago write that it is “very likely” that the company will misclassify its workers as independent contractors in order to avoid certain responsibilities it would have as an employer under applicable labor laws, such as a copy of the shared Writing out first with CNN Business. It will be signed by Andrew Fox and Steven Marchese, directors of the Chicago and Seattle Labor Standards Offices, and Amanda Shimko, director of the Philadelphia Office of Worker Protections.

“Cell phone’s treatment of its employees shows classic characteristics of the relationship between employer and employee,” said the letter. Workers use the “Economic Realities” test under the Federal Act on Fair Labor Standards to support their assessment. Officials note that this is a “far more forgiving standard” than local “ABC” tests, which use three criteria to determine whether workers are salaried in states like California and Massachusetts. (Uber, Lyft, DoorDash, and Instacart spent more than $ 200 million passing an election measure to exempt their companies from a new California labor law – Assembly Bill 5 or AB-5 – that requires an ABC test on the ballot contain.)

An integral part of this “economic reality” test is the level of control a company has over its employees. The letter says that cell phones control everything based on the information it tells workers about a job and employee communications with clients to compensate, including charging various charges to punish workers.

In a statement to CNN Business, a spokesman for Handy said that its employees, whom the company describes as professionals, “are properly classified under both tests.”

“Professionals decide if, when, where, how often, for whom they want to provide their services, and are not obliged to accept a certain number of jobs or even to work via the platform at all,” the statement said. “Professionals use the mobile platform to supplement their income and find jobs that fit their schedules, including other jobs and personal commitments.”

The spokesman said cell phones limit “length of communication only for the safety and protection of professionals,” claiming employees could exchange information with customers for future jobs outside of the app. However, Handy charges employees a fee for arranging off-platform jobs with customers, according to its website.

Labor officials also raised concerns outside of the worker classification issue, writing that they believed Handy violated other local regulations that protect workers, such as being an essential company in certain markets during part of the pandemic, even though they did not meet the requirements as failure to comply with various local protective measures for domestic workers. (The cell phone spokesman said he “fully adhered to public health rules and regulations in all markets during the pandemic”.)

An industry that is being scrutinized

The investigation comes at a time when the local workforce is increasingly scrutinizing how workers are being treated by companies. A report by Terri Gerstein of the Economic Policy Institute earlier this week found that an increasing number of prosecutors and attorneys general are taking on employers on issues ranging from employee misclassification to wage theft. Meanwhile, gig economy companies like Uber and Lyft are struggling more than ever to cement a business model that doesn’t require certain workers to be classified as workers.

Fox, the director of the Chicago Office of Labor Standards, said in a statement to CNN Business, “We have worked hard in Chicago to ensure that all of our employees receive a living wage and receive the stability, fairness and reliability they deserve . ” . ”

He said his office is “proud to join forces with our colleagues in encouraging Handy to get involved and provide their employees with the protection they have guaranteed here in Chicago and across the country.” The letter describes requests for additional information from Handy about its business practices.

With this move, Handy is now being closely monitored in five of its top markets – as measured by the number of detergents it works with in those areas – for its business model, according to Jenny Montoya Tansey, political director of the Public Rights Project. The Public Rights Project is a legal, not-for-profit organization that works with state and local governments, including Philadelphia, Seattle, and Chicago, to step up enforcement of potential labor rights violations.

In March, San Francisco and Los Angeles district attorneys filed a lawsuit against Handy for allegedly misclassifying its workers under AB-5. Demiraiakian, along with several other workers, filed a statement in support of the lawsuit earlier this month, outlining their experiences as part of the case. The cell phone spokesman said the suit was “categorically wrong and shows a fundamental misunderstanding of cell phones business” and that the company “will aggressively combat this misguided action”. The suit is still ongoing.

In Angi’s annual state-of-the-art filing with the Securities and Exchange Commission, the company said it was “particularly sensitive to adoption of employee classification laws” and noted “adverse tax, legal and other consequences” if it did the status of an independent contractor of its workers is challenged. Handy had some success lobbying local carve-out bills to defend its business model, exempting it and other gig companies from labor standards like minimum wage and hourly laws and unemployment insurance.

“We focused on cell phones”

The California litigation came after the Public Rights Project filed a complaint with the California Department for Fair Employment and Housing last fall alleging that some cell phone cleaners in the state reported having been sexually harassed at work , and that the company not only had not done enough to address incidents, but at times penalized workers with fees for leaving jobs early after incidents. The New York Times reported that Handy at the time said it was responding to such incidents and “workers are only charged a fee if the customer complains about an unfinished job,” which could be verified and not by the worker was contested.

Handy general counsel Jennifer Bishop said in a statement to CNN Business that training for the support team on responding to harassment reports has increased. “Any time a professional is harassed, we encourage that professional to leave the site immediately and report it to our team. The professional is paid in full, reimbursed for travel expenses from the location of the incident, and receives a call from our specially trained response Team, “Bishop said in a statement.

According to Montoya Tansey, there are a number of factors that have led cell phone to be scrutinized, including an increasing organization of domestic workers and new local domestic worker protection.

“We started tracking the problem of low-wage worker misclassification a few years ago when AB-5 was advancing in California legislature,” said Montoya Tansey, adding that home services was one of the sectors she added to this The exact time examined came to enforcement.

“We got into cell phones pretty quickly … because they seemed to have significantly more control over their people than some of the other companies in the market,” she said, noting that this matters as the control factor is used to determine it whether the workers are properly classified.