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The Center for New York City Affairs (CNYCA) new report reveals that 873,000 workers in many of New York State’s major low-paying industries are wrongly classified as “independent contractors.” The report, “For One in 10 New York Workers, 'Independent Contractor' Means Underpaid and Unprotected,” found that these misclassified, low-paid full-time workers – including 190,000 “gig workers” – only earn 69 percent as much as fulltime payroll employees do. They are also not eligible for key social insurance programs including, Social Security, unemployment insurance, workers’ compensation (in most cases), and both paid family and medical leave. Additionally, misclassified independent contractors have no legal right to bargain collectively with employers, earn overtime pay for working longer than 40 hours per week, or receive employer-offered health and retirement benefits.
Misclassifying employees not only penalizes the workers, but also our entire society. It strains government social programs by driving thousands of low-paid independent contractors to rely on programs like Food Stamps and Medicaid because they’re denied employer-based health insurance coverage and the pay they are entitled to. Reliance on low-paid independent contractors typifies a broader trend of fragmentation, fissuring, and deterioration of payroll jobs into more precarious and less-protected forms of work.