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How Independent Work is Challenging Traditional Employment Structures

As technology transforms the retail marketplace and enables retail workers to choose when, where, and how they will work, retail organizations have struggled adapting to this new employment structure—but not because of a lack of effort on their part. Labor laws, as they exist today, are written for an old-fashioned retail marketplace that does not necessarily exist anymore, largely in part because of this new, transformational technology and employment trends.

At INSIGHT 2019, South49 Solutions’ annual user conference, experts met to discuss the current and future trends in this space, their impact on the economy and traditional employers like retailers, as well as the regulatory and legal barriers curbing the momentum of independent work.

“The amount of workers who want to be an employee is decreasing,” said Carl Camden, Founder and President at iPSE-U.S., an association for independent professionals across many labor markets. “The industry is not ready to deal with this,” he added, and this is a problem specific to the United States since we, as a country, tie it so closely with the employment model, he said.

Laws that govern traditional employment structures require modernization, said Camille Olson, Chair Complex Employment Litigation, Seyfarth Shaw, a full-service law firm. Current laws do not favor this shift in the employment structure, especially on a personal level as independent workers are not given access to things that traditional employees are, like insurance benefits, said Hollie Heikkinen, CEO, iWorker Innovations LLC, an association management services provider.

As the employment structure shifts, the question is not, “How do I want my employees to work,” Camden said, but rather “Where is the talent and how do they want to work?” Workers find capital in themselves, and employers would do well to leverage this to meet their organizational goals, Olson added.

But in some cases, companies’ hands are tied as a result of legislation. For example, the IRS imposed an accountability plan on companies who reimburse employees for expenses when they would bring their own devices, known as BYOD, to complete their tasks at their jobs. Before the introduction of the accountability plan, The InStore Group, a full-service retail merchandising organization, was fully reimbursing their employees for expenses when they would bring their own devices, but had to discontinue this after the IRS’ direction, which would have had the company tax phone reimbursement as income to the employee. To protect its employees, The InStore Group adopted a new process whereby qualifying employees are reimbursed based on the percentage each month they use their device for business vs. personal usage.

In addition to necessary changes in laws, retail organizations would do well to embrace flexibility and differentiation between employees, both W2 and 1099 alike. “These changes will need to take place on a State and National level,” Camden said.

Olson, Camden, and Heikkinen currently serve on the Coalition for Workforce Innovation, which was formed to bring together a broad, diverse group of stakeholders like the service sectors, technology companies, as well as worker advocates to modernize federal workforce policy to enhance choice, flexibility, and economic opportunity for all workers.

The Coalition believes that individuals should have the freedom to determine how, when and where they work; that those choosing independent work should be treated fairly under the law in terms of access to training, benefits, and certain protections, and; that individuals should be able to work independently across all positions, platforms, and industries.

The Coalition seeks to collaborate with policymakers on the advantages of independent work as well as highlight the opportunities to enhance this positive trend by modernizing existing federal workforce policy for the benefit of workers, consumers, businesses and the overall economy.

Going forward, efforts like those made by the Coalition will likely make an impact on traditional employment structures and the laws that uphold them, working to bring these structures into the twenty-first century and yield improved worker satisfaction.

Blog Post courtesy of Natural Insight 


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