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California law tries to help independent contractors, but what’s really happening?

(BUSINESS NEWS) California is trying to make Uber and Lyft turn their independent contractors into employees, but what does this mean for the state’s freelancers?

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In a serious blow to freelancers across the state, California has recently made a move to force Uber and Lyft — the popular rideshare companies that act as an alternative to taxicabs — to recognize their drivers as employees. As it stands, California is the country’s biggest market for these two industries, and these new measures are calling into question the future of the state’s gig economy.

Back in January, California introduced a new bill (the controversial AB-5), which made it harder for companies like Uber and Lyft (as well as other courier-type businesses, such as DoorDash and Grubhub) to categorize their drivers as independent contractors. The bill arose out of protests from these drivers, who are not given certain privileges that waged employees receive. Their demands included healthcare, overtime, and unemployment…all things that are fairly standard for employees, but not available to independent contractors.

Unfortunately, this bill not only didn’t accomplish what it had set out to do, but it also completely devastated the freelance industry in California. Immediately gig workers and independent contractors across the state found their employment status called into question, with many out-of-state companies firing their freelancers out of fears that they’d have to categorize them as employees, as well. Other industries in the state released a number of their independent contractors, making the remaining ones work twice as hard to pick up the slack from fallout left behind by this bill.

While AB-5 still hasn’t taken its final form (and already amendments to this bill have been made to reflect the feedback from the state’s independent contractors), that hasn’t stopped Uber and Lyft from pushing back on it. In response to this new measure, they’re trying to introduce their own bill, citing that it would better serve the needs of their drivers. In a statement, Uber noted that their drivers prefer the independence afforded to them by their contractor status, and if this bill passed, some 158,000 drivers would lose their jobs.

Proponents of the bill, on the other hand, cite the potential benefits of it. They remark that passing it can help increase efficiency in the major cities, reduce traffic congestion, and while it can possibly lead to higher prices on these rideshare apps, it may also help dramatically decrease pollution, as well.

Both Lyft and Uber have rallied together to present their own ballot initiative, bringing their own money (to the tune of some $90 million) to the table to counter this measure. Instead of forcing these companies to turn their drivers into employees, they argue that the measure should be voted upon by constituents. These new policies should help appeal to the displaced drivers, providing them with benefits such as a minimum of 120% of minimum wage, an added $0.30 per mile for gas and wear and tear, automobile and liability insurance, and protection against discrimination.

As far as the existing freelancers and independent contractors in California, the jury is still out. Many of them have been left without a means to earn an income and are currently struggling in today’s coronavirus-impacted economy to find a source of sustainable income. Many companies are too anxious to take on the risk of accidentally finding themselves with an employee on their hands, making it all the more difficult for these freelancers to secure work.

If California Attorney General Xavier Becerra’s move to force the state to classify these gig workers as employees actually goes through, it will undoubtedly have a lasting impact on the state’s freelancers, gig workers, and independent contractors. It’s too early to tell what this impact will be, though. Perhaps it will be better for the freelancers in the state. It’s evident that many of them do want this bill to pass, but is bypassing a vote and moving directly to legislation the ideal move? Sadly, for the number of freelancers who want to retain their autonomy, their voices have ultimately been drowned out by the more vocal dissenters.

Karyl is a Southern transplant, now living on the Central Coast with her husband. She's proud to belong to two very handsome cats, both of which have made it very clear as to where she ranks on the social hierarchy. When she's not working as an optician, you can either find her chipping away at her next science-fiction novel or training for an upcoming race. She holds an AAT in Psychology, which is just a fancy way of saying that she likes poking around inside people's brains. She's very socially awkward and has no idea how to describe herself, which is why this bio is just as dorky and weird as she is.

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Keep your company’s operations lean by following these proven strategies

(BUSINESS) Keeping your operations lean means more than saving money, it means accomplishing more in less time.

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The past two years have been challenging, not just economically, but also politically and socially as well. While it would be nice to think that things are looking up, in reality, the problems never end. Taking a minimalist approach to your business, AKA keeping it lean, can help you weather the future to be more successful.

Here are some tips to help you trim the fat without putting profits above people.

Automate processes

Artificial intelligence frees up human resources. AI can manage many routine elements of your business, giving your team time to focus on important tasks that can’t be delegated to machines. This challenges your top performers to function at higher levels, which can only benefit your business.

Consider remote working

Whether you rent or own your property, it’s expensive to keep an office open. As we learned in the pandemic, many jobs can be done just as effectively from home as the workplace. Going remote can save you money, even if you help your team outfit their home office for safety and efficiency.

In today’s world, many are opting to completely shutter office doors, but you may be able to save money by using less space or renting out some of your office space.

Review your systems to find the fat

As your business grows (or downsizes), your systems need to change to fit how you work. Are there places where you can save money? If you’re ordering more, you may be able to ask vendors for discounts. Look for ways to bring down costs.

Talk to your team about where their workflow suffers and find solutions. An annual review through your budget with an eye on saving money can help you find those wasted dollars.

Find the balance

Operating lean doesn’t mean just saving money. It can also mean that you look at your time when deciding to pay for services. The point is to be as efficient as possible with your resources and systems, while maintaining customer service and safety. When you operate in a lean way, it sets your business up for success.

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How to apply to be on a Board of Directors

(BUSINESS) What do you need to think about and explore if you want to apply for a Board of Directors? Here’s a quick rundown of what, why, and when.

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What?
What does a Board of Directors do? Investopedia explains “A board of directors (B of D) is an elected group of individuals that represent shareholders. The board is a governing body that typically meets at regular intervals to set policies for corporate management and oversight. Every public company must have a board of directors. Some private and nonprofit organizations also have a board of directors.”

Why?
It is time to have a diverse representation of thoughts, values and insights from intelligently minded people that can give you the intel you need to move forward – as they don’t have quite the same vested interests as you.

We have become the nation that works like a machine. Day in and day out we are consumed by our work (and have easy access to it with our smartphones). We do volunteer and participate in extra-curricular activities, but it’s possible that many of us have never understood or considered joining a Board of Directors. There’s a new wave of Gen Xers and Millennials that have plenty of years of life and work experience + insights that this might be the time to resurrect (or invigorate) interest.

Harvard Business Review shared a great article about identifying the FIVE key areas you would want to consider growing your knowledge if you want to join a board:

1. Financial – You need to be able to speak in numbers.
2. Strategic – You want to be able to speak to how to be strategic even if you know the numbers.
3. Relational – This is where communication is key – understanding what you want to share with others and what they are sharing with you. This is very different than being on the Operational side of things.
4. Role – You must be able to be clear and add value in your time allotted – and know where you especially add value from your skills, experiences and strengths.
5. Cultural – You must contribute the feeling that Executives can come forward to seek advice even if things aren’t going well and create that culture of collaboration.

As Charlotte Valeur, a Danish-born former investment banker who has chaired three international companies and now leads the UK’s Institute of Directors, says, “We need to help new participants from under-represented groups to develop the confidence of working on boards and to come to know that” – while boardroom capital does take effort to build – “this is not rocket science.

When?
NOW! The time is now for all of us to get involved in helping to create a brighter future for organizations and businesses that we care about (including if they are our own business – you may want to create a Board of Directors).

The Harvard Business Review gave great explanations of the need to diversify those that have been on the Boards to continue to strive to better represent our population as a whole. Are you ready to take on this challenge? We need you.

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Business News

Average age of successful startup founders is 45, but stop stereotyping

(BUSINESS) Our culture glorifies (yet condemns?) startup founders as rich 20-somethings in hoodies, but some are a totally different type.

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There’s a common misconception that startups are riddled with semi-nerdy, 20-something white dudes who do nothing but sip Nitro Brews and walk around the open office showing off the hoodie they wore yesterday. It turns out that it’s extremely rare that startup offices resemble The Social Network.

However, the academic backdrop for the real social network story (AKA Harvard), produced statistics that will serve to put the aforementioned misconception to rest. According to the Harvard Business Review, the average age of people who founded the highest-growth startups is 45. Say what?! A full-fledged adult?!

In fact, aside from the age category of 60 and over, ages 29 and younger were the smallest group of founders that are responsible for heading the highest-growth startups. I guess you can accomplish a lot when you’re not riding around the office on a scooter all day.

The study also found that older entrepreneurs are more likely to succeed. The probability of extreme startup success rises with age, at least until the late 50s. It was found that work experience plays an important role.

Many will argue, “Well, what about someone like Steve Jobs?” You could easily argue right back that it took Jobs until the age of 52 to create Apple’s most profitable product – the iPhone.

The study continues to answer questions like, why do Venture Capitalist investors bet on young founders? This goes back to the misconception at the start, and there’s a notion that youth is the key for successful entrepreneurship. Wrong.

There is also the idea that younger entrepreneurs are likely working with less financial options, so it may be common for them to take something from a VC at a lower price. As a result, they could be viewed as more of a bargain than older founders.

“The next step for researchers is to explore what exactly explains the advantage of middle-aged founders,” writes Pierre Azoulay, et al. “For example, is it due to greater access to financial resources, deeper social networks, or certain forms of experience? In the meantime, it appears that advancing age is a powerful feature, not a bug, for starting the most successful firms.”

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