The Critical Loophole in Worker Protections

By Jessie La Roche 

The Law Students on Workers’ Rights series publishes essays from current and incoming students at some of the top law schools in the country. These essays, submitted for the Charles E. Joseph Employment Law Scholarship, address the question “What are the biggest challenges facing workers’ rights in the future?”

The overabundance of part-time and gig jobs presents a serious challenge facing present-day workers’ rights. Part-time and gig jobs comprise the vast majority of open positions, yet they provide inconsistent pay and few benefits. These jobs are rarely sustainable in the long term, as they usually do not offer healthcare, paid time off, overtime pay, and in the case of gig jobs, a minimum wage. Still, employers favor these jobs in order to cut their costs, despite the detrimental effects on their own employees. 

Employers are required by law to provide their full-time employees with a number of employment benefits, including Social Security, unemployment insurance, workers’ compensation insurance, and FMLA protections. The average employer cost for employee benefits added up to $11.47 per hour in Sept. 2022. 

Employing part-time or gig workers is far less expensive than hiring full-time employees. Due to this, Forbes reports that the gig economy experienced a 33% growth in 2020 alone. Many of these jobs come from food delivery services which pay only a commission and often require workers to use their own vehicle, with no stipend provided for gas or upkeep. These jobs do not provide access to health insurance, paid time off, and have no unions. While estimates suggest the average UberEats driver makes about $19 an hour, one delivery driver states that after other costs, he takes home less than half of his earnings.

These jobs yield far fewer benefits and less financial security, yet many workers have few options. Forbes estimates that by 2027, half of the United States population will have engaged with gig work of some form in their lifetimes. Over a third of workers in the U.S. today engage in the gig economy in some capacity. 

The percentage of part-time workers in the United States is similarly increasing, though employers are not always immediately transparent about the number of hours offered. An experiment conducted by a job seeker in Florida found a surprisingly low response rate to job applications, and those who did reply attempted a bait-and-switch, offering fewer hours and lower pay. The person conducting this experiment noted that he was applying for full-time positions, all of which were hiring. After 60 applications, he received one interview. 

This problem is not isolated to job seekers: according to a study conducted by The Shift Project, a quarter of low-wage workers employed by chain businesses are underemployed, despite requesting more hours. The Bureau of Labor Statistics finds that 6.8% of the U.S. population reported being underemployed in 2022.

In my experience, employers often rely on a younger workforce to fill low-paying, part-time positions. I started a minimum wage job at a frozen yogurt shop in the West Village in New York City in September 2021. The owner had moved to Arizona at the start of the pandemic and was struggling to keep the place staffed. Ironically, the “now hiring” sign, perpetually duct-taped to the front door, attracted multiple applications a week. Nearly all applicants wanted full-time work, but the owner was reluctant to schedule anyone for over 25 hours a week. As a consequence, the store was staffed by high school and college students who blatantly abused the free fro-yo privileges and quit at the first sign of a better opportunity. I worked there for nine months, immediately putting in my notice after receiving an internship offer for $10 more an hour. 

While part-time and gig jobs often benefit employers, they prevent workers from being able to provide for themselves. The Fair Labor Standards Act, passed almost a century ago, was intended to ensure that employers do not take advantage of their employees. The rise in part-time and gig employment shows that more and more employers are making use of a loophole within this law. Without reform, this crisis will only continue to grow. 

Reflections from Charles Joseph

The rising number of gig and part-time workers means fewer workers receive benefits through work. And, as Jessie La Roche argues, they also miss out on critical worker protections. Independent contractors – which includes freelancers and gig workers – do not even have basic minimum wage protections. 

While local laws like the NYC Freelance Isn’t Free Act provide some protections, they fall far short of those covering full-time employees. If this loophole continues, workers’ rights advocates must focus on educating workers and leveraging the protections that do exist.

Jessie La Roche holds a bachelor’s degree in public policy from New York University. In the fall, she will join the class of 2026 at UC Law San Francisco. Contact La Roche on LinkedIn.

Charles Joseph has over two decades of experience as an NYC employment lawyer. He is the founder of Working Now and Then and the founding partner of Joseph and Kirschenbaum, a firm that has recovered over $140 million for clients.