A group representing gig-economy apps including Uber and Lyft has raised concerns over President Biden’s nominee to lead the Labor Department — in particular questioning her position on worker-classification rules.
The Flex Association — which also represents Doordash and Instacart — asked Julie Su, Biden’s nominee for Labor Secretary, to explain how she would classify workers as employees rather than independent contractors “in a manner that protects independent work,” according to a Monday letter to the White House obtained by The Post.
The letter cited analysis that the new rules would force 1.5 million workers identified as non-traditional employees to leave the labor force, costing an estimated $31.4 billion in earnings.
The group also asked the Labor Department to delay its action on the proposal until the Senate confirms a nominee for secretary, as its gig companies rely largely on contract workers.
“Unfortunately, the DOL is considering a variety of proposals that could undercut the availability of independent jobs for millions of Americans, impacting families and communities throughout this country,” Kristin Sharp, CEO of Flex Association said in the letter.
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Flex Association wrote that Su “does not fully appreciate the potential impact” of the measure and “has a record indicating an oppositional approach to policymaking that carries real implications as she seeks to be elevated to serve as the Department’s primary policymaker.”
Su, who previously served as deputy labor secretary in California before joining the Biden administration, upheld a law making companies to classify workers as contractors more complicated, allowing businesses to save millions of dollars but depriving workers of protections like minimum wage and benefits.
Sharp said the California law, which is being challenged in federal court, “wreaked havoc across multiple industries,” saying that Su’s explanation on the policy during Senate confirmation would let stakeholders properly evaluate their position on her nomination.
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The letter challenging Su’s nomination to replace Marty Walsh as labor secretary comes as business groups and Republicans have criticized her support for measures affecting the gig economy.
The White House sent Su’s nomination to the Senate last week, allowing the confirmation process to begin. Biden earlier this month urged the US Senate to quickly confirm Su and hailed his nominee for her past work to increase worker wages and expand protections.
The Biden administration issued a proposal on independent-contractor status last October that would scrap a Trump administration’s policy that prompted companies to hire people as contractors, which critics said left workers vulnerable to misclassification. The proposed rule is not final yet, according to Bloomberg.
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The final rule is expected this year and the push to lobby against it is picking up momentum, Reuters reported.
Most federal and state labor laws, such as those requiring a minimum wage and overtime pay, only apply to a company’s employees, who can cost companies up to 30% more than independent contractors.
With Post wires