Legislative Testimony: LB 1045, Defining Independent Contractors

Chairman Harr and Members of the Business and Labor Committee, my name is Jessica Herrmann, and I am the Director of Legislative Outreach testifying today on behalf of the Platte Institute for Economic Research. Thank you for this opportunity to speak in support of LB 1045.
 

Postmates, Zipments, TaskRabbit, DoorDash, Pinch, Caviar, Seamless, GrubHub, Wunwin, Exec, Handy, HomeJoy, Curbside…these are all the names of technology-based service platforms that facilitate new work opportunities for independent contractors.
 

LB 1045 would add Nebraska to the list of states, including Arkansas, Florida, Indiana, Ohio and North Carolina, recognizing that an economic benefit exists for states to adapt rather than reject this transformation in the American labor force.
 

Workers in Nebraska and nationwide are shifting toward more independent, self-directed employment outside the bounds of the traditional office environment.
 

The rise of the sharing marketplace has provided a crucial support structure to meet this changing mentality, allowing millions of people to seek out alternative work lifestyles that provide for their families but on their own terms.
 

However, many of our current labor laws were developed decades ago before society could contemplate how technology would revolutionize the economy. As such, IRS labor classification guidelines do not address the unique relationship between platform and marketplace contractors. Consequently, any debate about the nature of this relationship under the current guidelines is fruitless.
 

Instead, the shared economy needs clear rules that take into account this distinct relationship. Unlike a traditional employee or independent contractor, these shared workers may work for only one platform each week from 9 to 5, or they may contract with multiple companies at once, performing a variety of services with a variety of their own tools, only on weekends or for a very short overall duration. They are all different, and the flexibility to pursue their own working arrangement is precisely why we cannot easily fit this unique business model into one box.
 

What really matters is that regulators do not stop this transformation. Instead, policymakers must ensure there are greater opportunities and mobility within this growing economy.
 

Nebraska should be encouraging an inviting economic climate for people exercising their own property and tools to make their own choices about employment. LB 1045 does just that, and we urge the Committee to advance this bill.
 

Thank you for this opportunity to testify today. I am happy to answer any questions.