In a world without laws, it would be great to be able to hand someone supplies, train them, and give them 30 bucks under the table. But we re compliant, and the result is employees who have rights.
— Ken Schultz, MyClean s chief operating officer, on switching to hiring employees for its cleaning service instead of using contractors. New York Magazine looks at the contract economy vs. the employee economy — or in tax parlance, the 1099 economy vs. the W-2 economy — amid the rise of startups that rely on a 1099 labor force. Think the Uber for… you name it.
Bay Area-based Spoonrocket provides quick meal delivery. CEO Steven Hsaio told NY Mag: For a certain amount of time we tested out W-2 drivers, but that s when we provided equipment (company cars). It wasn t the most financially sound decision. Obviously, it s beneficial for the startups. But Hsaio believes it s for the drivers own good, too. We can t tell [drivers] what to do or how to do their job. They re their own entrepreneurs.
But what s the price of independence? Lack of benefits, regular income and more. And ride-sharing companies Uber and Lyft have fought a push to provide their drivers with more insurance. (Although a newly signed California law will require them to do so starting in July.)
Photo of a Lyft vehicle by Jose A. Iglesias/Miami Herald/MCT
