Warren: Explosion of contract workers ‘a problem’

Sen. Elizabeth Warren (D-Mass.) wouldn’t say Tuesday night whether she thought that employees for companies like Uber and Lyft that use an army of contractors to meet growing demand should instead be classified as employees, and thus receive greater protections and more benefits.

The topic came up during an on stage appearance at a conference produced by news organization Re/Code, when a BuzzFeed News reporter asked whether “1099” workers, named after the tax form they fill out as contractors, should instead be seen as more traditional workers for the many startups that rely on their labor.

{mosads}Warren didn’t answer, but she did express concern about the way companies in general are using their contractors.

“I think there is evidence that increasingly employers use independent contractors not in ways that were originally intended but in ways that permit them to treat employment laws differently than they otherwise would be responsible for, and I think that’s a real problem,” she said. “And I think the Department of Labor is looking into this and I think they’re right to do that.”

It was not clear what Department of Labor investigation she was referring to, though the agency does run investigations into whether employers are misclassifying their employees as contractors.

Contractors are not eligible for certain benefits afforded to regular employees, including unemployment. Uber and Lyft drivers in California have sued in order to be recognized as employees, and a Florida agency found this month that an Uber driver seeking unemployment benefits was an employee.

On Tuesday, Warren also seemed to strike some notes that were sympathetic with Silicon Valley.

“Our only chance for survival to innovate our way out of this,” she said, when asked about how Silicon Valley is changing the economy. “We’re not going to stop tech so that lots of people can work. That’s like saying ‘Oh, let’s get rid of heavy equipment and have everybody dig with a spoon, because that way lots of people will be employed.’ No, that’s not going to work.”

She also said that “work is changing in America.”

“The old notion, you work for one employer forever and ever, that’s just gone,” she said. “People are going to piece together a lot of different work, and a lot of different kinds of work, over the arc of a career.”

Many politicians have seized on startups, including sharing economy firms like Uber, as a symbol of Silicon Valley’s place as an economic driver. Earlier this month, two congressmen launched the Sharing Economy Caucus to educate people on Capitol Hill about the issues facing the burgeoning industry.

The Republican National Committee has said that sharing economy companies like Uber and Airbnb are evidence of the kind of innovations they say can be stifled by regulation.