Dem calls for ‘regulatory time-out’ for on-demand economy

One of the most vocal advocates for reforming social safety net programs for on-demand companies like Uber called Wednesday for a “regulatory time-out” to allow the companies a chance to experiment with giving more benefits to their workforce.

“One of the things that I hope to bring to the table is the idea of could we get even a regulatory time-out so that those companies who want to think about social insurance, unemployment, workman’s comp, disability, other attributes could try them without trying to fall back into 20th century reclassification debate,” Sen. Mark Warner (D-Va.) said while speaking at The Atlantic’s Washington Ideas Forum.

{mosads}Many of the companies, including Uber and Lyft, view their workers as independent contractors who don’t get benefits and protections that are afforded to many full employees.

Warner also gave another look into his thinking about how to handle the questions about workers.

“End of the day, I think we will end up with a third classification,” he said, referencing the idea that the government should create a third way to classify workers outside of the employee-or-contractor structure. “I think other countries have already done that.”

However, he cautioned that “I don’t think as policymakers that we’re even ready to define what that third classification would look like.”

For months, he has floated the idea of an “hours bank” that would administer benefits independent from any of the companies. He also said on Wednesday that one idea that had gotten some traction in Silicon Valley would see consumers add a gratuity-like fee to their payments that would go toward benefits and would be matched by the companies.

He also made the argument on Wednesday that the on-demand economy would not be thriving if not for ObamaCare to underscore the importance of separating benefits from employers.

“And by the way, most of this on-demand economy would not have happened had there not been the ACA, because the severance of health insurance and employment has allowed a lot of people to take this plunge into the on-demand economy,” he said.

Travis Kalanick, the CEO of Uber, has previously said that ObamaCare is “huge” for the company.

Warner is not the only policymaker weighing the questions around the on-demand economy.

A subcommittee of the House Energy and Commerce Committee held a hearing on Tuesday related to the topic, which also raised questions about how the companies use and protect consumers’ data. But overall, the Republican majority on the committee was wary of regulating the sector too heavily.

Republicans on the campaign trail have been more aggressive, suggesting that Democratic policies will be bad for fast-growing companies like Uber.

The question of whether the workers are employees is also being considered by the courts, with both Uber and Lyft facing class action lawsuits from drivers who claim that they should actually be classified as employees.