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Homejoy startup closes their doors, impacts other startups

Homejoy was like the Uber of home services and now it’s shutting down. What does this say for contract labor overall? Is it on the way out?

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Like so many others, Homejoy is a startup of the past

Homejoy, a company that helped connect homeowners with house cleaning and home service providers, will shut down at the end of this month. Homejoy was like the Uber of home services, “from cleaning to carpentry,” providing a platform for home owners to find service providers in 35 cities across North America and Europe.

According to chief executive Adora Cheung, legal action against the company was a “deciding factor” in Homejoy’s move to call it quits. In a class action lawsuit, Homejoy was sued for mischaracterizing its service providers as independent contractors, rather than regular employees. Similar lawsuits have been brought against the app-based delivery services Postmates and Try Caviar. By classifying workers as independent contractors, companies can skimp on the benefits they would be expected to provide for regular employees, such as guaranteed overtime and minimum wage, or reimbursement for job expenses.

However, it is unlikely that legal troubles alone led to Homejoy’s demise

After all, if it was feasible for the company to start providing benefits for full employees, they might have tried. Realistically, there aren’t huge profits to be made as a go-between in the home services marketplace, as the average house cleaner earns less than $20K per year. In a way, Homejoy was skimming profits off of workers who are already barely hovering above the poverty line.

In the words of an anonymous commenter on Quora, Homejoy was also a failure because their idea “requires significant change in user behavior on both sides of the marketplace.” Homeowners are accustomed to finding help at home through internet sites like Craigslist, or even more commonly, through personal referrals. Home service professionals like house cleaners and carpenters find plenty of jobs this way without the assistance of a third party. What’s more, housekeepers and the like are used to accepting cash, whereas Homejoy relies on credit cards, which mean that workers will have to report a higher income and pay higher taxes. Once a Homejoy user establishes a working relationship with a housekeeper, they have no reason to keep using Homejoy, since they can easily cut out the middleman, skip an unnecessary step, and save money.

The state of disruption

In the age of on demand services, some things are just easier and cheaper to arrange without an intermediary. This lack of profit potential, combined with the questionable legality of hiring “independent contractors,” spelled doom for the short-lived startup. Other startups with similar models will be examining the impact of this closing and considering how the Homejoy speed bumps might alter their own future.

Ellen Vessels, a Staff Writer at The American Genius, is respected for their wide range of work, with a focus on generational marketing and business trends. Ellen is also a performance artist when not writing, and has a passion for sustainability, social justice, and the arts.

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Business News

Unify your remote team with these important conversations

(BUSINESS NEWS) More than a happy hour, consider having these poignant conversations to bring your remote team together like never before.

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Cultivating a team dynamic is difficult enough without everyone’s Zoom feed freezing halfway through “happy” hour. You may not be able to bond over margaritas these days, but there are a few conversations you can have to make your team feel more supported—and more comfortable with communicating.

According to Forbes, the first conversation to have pertains to individual productivity. Ask your employees, quite simply, what their productivity indicators are. Since you can’t rely on popping into the office to see who is working on a project and who is beating their Snake score, knowing how your employees quantify productivity is the next-best thing. This may lead to a conversation about what you want to see in return, which is always helpful for your employees to know.

Another thing to discuss with your employees regards communication. Determining which avenues of communication are appropriate, which ones should be reserved for emergencies, and which ones are completely off the table is key. For example, you might find that most employees are comfortable texting each other while you prefer Slack or email updates. Setting that boundary ahead of time and making it “office” policy will help prevent strain down the road.

Finally, checking in with your employees about their expectations is also important. If you can discuss the sticky issue of who deals with what, whose job responsibilities overlap, and what each person is predominantly responsible for, you’ll negate a lot of stress later. Knowing exactly which of your employees specialize in specific areas is good for you, and it’s good for the team as a whole.

With these 3 discussions out of the way, you can turn your focus to more nebulous concepts, the first of which pertains to hiring. Loop your employees in and ask them how they would hire new talent during this time; what aspects would they look for, and how would they discern between candidates without being able to meet in-person? It may seem like a trivial conversation, but having it will serve to unify further your team—so it’s worth your time.

The last crucial conversation, per Forbes, is simple: Ask your employees what they would prioritize if they became CEOs tomorrow. There’s a lot of latitude for goofy responses here, but you’ll hear some really valuable—and potentially gut-wrenching—feedback you wouldn’t usually receive. It never hurts to know what your staff prioritize as idealists.

Unifying your staff can be difficult, but if you start with these conversations, you’ll be well on your way to a strong team during these trying times.

This story was first published in November 2020.

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Business News

How to apply to be on a Board of Directors

(BUSINESS NEWS) 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

Age discrimination lawsuits are coming due to the pandemic – don’t add to the mess

(BUSINESS NEWS) Age discrimination is spreading despite intentions to help, and employers need to know how to proceed in this unprecedented era.

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Ageism void

Before the pandemic, age discrimination was prevalent in workplaces. The EEOC reports that in 2018, about 6 out of 10 workers aged 45 years and older say they experience discrimination on the job.

A 2015 survey found that 75% of older workers found age an obstacle in job hunting. COVID-19 made the situation much worse.

Not only do older workers deal with discrimination, but they are at a higher risk of developing serious complications from the virus. According to the Society for Human Resource Management, older workers were hit the hardest by job loss during the pandemic, which is unusual during a recession. As offices reopen, employers need to be careful to avoid age discrimination in rehiring.

Lawyers expect age discrimination lawsuits to increase.

Last September, Harris Meyer published an article in the ABA Journal that predicted a “flood of age discrimination lawsuits” from the pandemic. Employers who have good intentions by keeping older employees out of the workplace to protect their health are still guilty of age discrimination.

What can employers do to avoid age discrimination?

It may be fine line between making sure you don’t discriminate based on age while offering ADA accommodations. The first thing employers should do is to know what laws apply based on their location. Some states exempt employees over 65 from returning to the workplace out of safety fears, meaning that those employees can still get unemployment. Other states are cutting benefits if employees don’t return to work, regardless of age.

There are some jurisdictions that have passed legislation about which workers have the right to be recalled. Next, review your own policies and agreements with laid off and terminated employees. You may want to consult legal counsel to make sure you’re covering your bases.

As you rehire, whether you’re bringing back former employees or hiring new team members, do not make hiring decisions based on age. Keep good documentation about your decisions to terminate certain employees. If you are citing poor performance, make sure to have a record of that. Don’t terminate older employees who have bigger salaries just because of lower sales. Monitor your words (and that of your hiring team) to avoid bias in hiring and firing.

Provide accommodations or not?

According to the SHRM, “Workers age 40 and older are protected from bias by the Age Discrimination in Employment Act; however, that law doesn’t require employers to make accommodations for safety concerns.”

Still, employers can provide flexibility for workers, but it largely depends on the type of job. Reaching an accommodation for an office worker will be much easier than accommodating a sanitation worker.

Employers should assume that workers aged 40 and older can return to work. When the need for help is raised by the employee, enter negotiations for accommodations. Don’t initiate the conversation, and absolutely avoid any references to age.

Know that the environment may change as the pandemic continues to affect workers.

Be thoughtful about your hiring practices moving forward to avoid costly litigation from age discrimination.

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