The Gig Economy in the Crosshairs of the EEOC | DCR Workforce Blog

The Gig Economy in the Crosshairs of the EEOC

On October 17, 2016, the Equal Employment Opportunity Commission (EEOC) has approved an updated Strategic Enforcement Plan (SEP) for fiscal years 2017–2021, setting out its priorities and strategies for the near term. The EEOC affirms its commitment to focus on the fairness (or lack thereof) in the employment practices governing the complex employment relationships and work structures of the 21st century workplace; specifically referring to temporary workers, staffing agencies, independent contractor relationships and the on-demand economy.

The Strategic Enforcement Plan and its directives

The aim and focus of the EEOC is always to ensure equal opportunity and freedom from discrimination to all workers in a workplace. The Strategic Enforcement Plan shall continue to prioritize, at the national level, issues such as:

  1. Eliminating barriers in recruiting and hiring
  2. Protecting vulnerable workers, including immigrant and migrant workers, and underserved communities from discrimination
  3. Addressing selected emerging and developing issues
  4. Ensuring equal pay protections for all workers
  5. Preserving access to the legal system and
  6. Preventing systemic harassment

Going forward, the EEOC plans to integrate, collaborate and coordinate data and activities across the agency’s nationwide offices and evaluate any charges brought based on a three-pronged approach of considering their likely merit potential irreparable harm to the claimant, and the national priority implicated.

Focus on the gig economy

This new focus on the gig economy comes out in the emphasis the EEOC’s SEP places on the “complex employment relationships and structures in the 21st century workplace” and its recognition of the fact that more and more people are working in alternative or contingent arrangements and on-demand jobs.

Independent contractors are rarely entitled to the benefits of federal civil rights protections the way employees are. The EEOC could consider any misclassification of workers as a deliberate attempt to deprive them to the types of protections it can secure for them. With about 54 million freelancers in the American job market, the gig economy proves an attractive choice for the entrepreneurial workers who prefers independence and flexibility, but the arrangement has a lot of regulatory powers concerned at the lack of job security, company-sponsored benefits and the very issue of the worker’s employment status. Now the EEOC’s avowed stance could prove an additional threat to the players in the gig economy already fighting legal battles on the validity of their worker classification. Other employers using contractors, freelancers and temporary workers desirous of avoiding the EEOC’s negative attention need to ensure that they classify theirs workers right to avoid unnecessary complications and face liabilities for payroll taxes, interest and penalties. Employers who are using staffing suppliers to source these workers may also be cautious about avoiding any liability as joint employers.

Among other things, the EEOC’s stance implies that employers are to guard against exercising any backlash discrimination against those who are Muslim or Sikh, or persons of Arab, Middle Eastern or South Asian descent. Employers may also ensure that any disabled workers, pregnant women and others needing accommodations are not being discriminated against due to its qualification standards, data driven applicant screening and inflexible leave policies that discriminate against specific categories of workers. The EEOC’s SEP policy guidelines must also put all the high-tech companies which depend on internet data and algorithm-based resource screening on guard if they are not simultaneously focused on maintaining their diversity numbers when hiring candidates.

The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.