In recent years the labor market has experienced a large influx of independence, both for employers and workers, through the increase in use of contract workers. Many individuals who were negatively impacted by the economic downturn caused by the housing bubble were reluctant to place their trust in another corporate entity by binding themselves to it as a full-time employee. As the number of these individuals rose, the labor market received a large increase in workers who could be hired on an as-needed basis, on short notice, and who were in control of their own schedules, benefits and other things that were traditionally provided by employers.
As the pendulum swings back toward a more traditional employment market, helped along by recent developments by the pro-contractor union stance of the National Labor Relations Board (NLRB) and the Uber decisions of the California courts, it is a good time to reflect on the independent contractor era and consider how it may have changed American employment as we know it.
Benefits of Contractor-Based Employment Support
Independent contract employees can provide a much needed, rapid response worker support network for employers in a variety of industries. Employers from governmental agencies to law firms have benefitted from the ability to hire highly educated, skilled workers quickly and without having to jump through administrative hoops of more traditional hires that can cause significant delay. Workers benefit from this situation as well since they are able to find work and begin earning a paycheck much faster than the more traditional method requiring a lengthy application process, multiple interviews, and weeks of waiting on paperwork to make its way through a company’s human resources department. Contract employees are also more mobile, allowing them the freedom to move from a bad employment situation to one that is a better “fit” with little to no impact that traditional employees have with their lengthy employment contract obligations.
As many discussions have pointed out in recent months, the contract employment market is not without its pitfalls. Contract workers typically do not have the same protections as full time employees, such as workers’ compensation coverage, health and disability benefits, or unemployment insurance benefits. While these protections have typically been provided by the agencies that contract workers use to find new employment opportunities, recent developments have muddied the waters on which entity is considered the “employer” for worker protection considerations. As confusion is typically not a state that fosters growth, companies moving forward should take note of the positives offered by contract workers and use them to improve upon their more traditional hiring processes. A faster, more efficient hiring process that results in highly qualified, eager full time employees being hired is a win-win situation for employers and workers alike.
If your business is seeking to grow its workforce responsibly and efficiently, the first step is to ensure that any decisions made do not lead to legal trouble down the road. Call the attorneys at Garcia & Gurney today, who can talk to you about the most recent developments in employment law and can provide advice that is tailored to your unique situation.