Unboxing the Gig Worker within Labor Laws
Editor's note: A follow-up essay, Independent Contractors Are Not Outside Labor Law, clarifies how labor regulations apply to gig workers without reclassifying them as employees.
Why Labor Law Exists
Labor laws exist for a reason. They were created to protect ordinary people from being exploited by systems that are larger, more powerful, and structurally advantaged. They recognize a basic reality of work: when one side controls access to jobs, sets the terms of pay, individual workers cannot bargain on equal footing. The law exists to correct that imbalance.
It also exists because someone has to bear the costs of work—healthcare, injury, unemployment. When companies can offload those costs onto workers and society while keeping the profits, the imbalance isn’t just unfair. It’s unsustainable.
Determining who is an employee and who is an independent contractor (a self-employed business owner) becomes important.
In various forms, the way this question is answered and how it interacts with labor laws will continue to be in the news as this new sector of the economy grows. It’s important to understand how this works in order to parse the events in the news related to this.
A Simple Litmus Test
You hear this debate all the time between companies like Uber that operate in the gig economy and governing agencies: are the people doing the work employees or independent contractors?
In my opinion, there is a very simple common-sense litmus test for this:
Would an Uber Eats driver tell their friends that they run their own business?
Of course not.
It’s that simple!
And Uber does not treat them as business owners either.
This disconnect matters because the entire legal and moral defense of the gig economy rests on the idea that workers are independent contractors—entrepreneurs choosing when and how to sell their services. But when you strip away the language and look at the reality of the work, what you find looks far less like entrepreneurship and far more like employment managed through software.
What an Independent Business Actually Looks Like
Consider what defines an independent business in any ordinary sense. A business sets its own prices. It chooses its customers. It controls how work is done. It can refuse jobs without penalty. It builds equity, reputation, and long-term value that belongs to the owner.
Now consider a gig worker.
Yes, gig workers can choose when to log on. But schedule flexibility alone does not make someone a business owner—not when every other aspect of the work is controlled by someone else. Labor law already accommodates part-time workers, seasonal employees, and other variations. Flexibility in scheduling has never been a reason to strip workers of basic protections.
An Uber Eats driver does not set prices. The app does. They do not choose customers. The app assigns them. They do not negotiate terms. The app dictates them. They do not control demand. The algorithm does. They do not own the relationship with the customer. The platform does. They cannot truly refuse jobs without penalty. Decline too many and the algorithm de-prioritizes or deactivates them. They do not build equity. The platform does. A five-star rating belongs to Uber, not the driver. If they leave, they take nothing with them—no customer list, no reputation, no asset they can sell. Years of work produce zero transferable value. They can be removed from the system instantly, without appeal, by a company decision they did not participate in.
Every meaningful aspect of the work—pay, access, rules, discipline, and continued eligibility—is controlled by the platform.
That is not an independent business relationship. That is labor.
It’s managed labor, with the “gig” label providing cover to avoid the responsibilities that come with employment.
Note: A handful of jurisdictions—California, New York, New Jersey, and Washington state—have established appeal processes for deactivated drivers through legislation or union agreements. These remain the exception, not the rule.
The Fiction That Must Change
The goal is not to eliminate gig work or force every job into an outdated employment model. The gig economy is here to stay. It is already embedded across industries, borders, and professions. What must change is the fiction. Work governed by comprehensive corporate control cannot be allowed to fall outside the basic principles that labor law was designed to enforce.
Disclosure: The author holds small positions in Uber, Upwork, and DiDi Global Inc.