Work Futures Update | The World as Organization

| Uber and Lyft v. California | The Daily News Closes Its Newsroom | REI Selling Brand-New HQ | WFH ETF | Home Office Cubicle |

Stowe Boyd

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8 min readAug 19, 2020

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2020–08–19 Beacon NY | I had a short vacation and spent time by a lake. Nice.

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We owe the title of this issue to Von Bertalanffy’s quote, below.

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Quote of the Moment

We are seeking for another basic outlook: the world as organization. This [outlook] would profoundly change the categories of our thinking and influence our practical attitudes. We must envision the biosphere as a whole… with mutually reinforcing or mutually destructive interdependencies. [We need] a global system of mutually symbiotic societies, mapping new conditions into a flexible institutional structure and dealing with change through constructive reorganization.

| Ludwig von Bertalanffy

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Gig Economy

Lyft joins Uber in threatening to pull out of California over driver status | Andrew Hawkins reports on Lyft making the same threats as Uber arising from court ruling:

At issue is the classification of ride-hailing drivers as independent contractors, which Uber and Lyft say most drivers prefer because of the flexibility and ability to set their own hours. But labor unions and elected officials contend this deprives them of traditional benefits like health insurance and workers’ compensation. Earlier this week, Uber and Lyft were ordered by a California superior court judge to classify their drivers as employees. Both companies have said they would appeal the ruling, which was stayed for 10 days.
But if their appeals fail, Lyft may join Uber in closing up shop in California, the company’s president John Zimmer said. “If our efforts here are not successful it would force us to suspend operations in California,” Zimmer said on a call announcing the second quarter earnings of 2020. “Fortunately, California voters can make their voices heard by voting yes on Prop 22 in November.”
Uber and Lyft, along with DoorDash, are funding a ballot measure, Proposition 22, that would override AB5 by classifying ride-hail drivers and other gig economy workers as independent contractors. The ballot measure is the companies’ Plan B if their efforts to overturn the state’s legal challenges fail.
If drivers were classified as employees, Uber and Lyft would be responsible for paying them minimum wage, overtime compensation, paid rest periods, and reimbursements for the cost of driving for the companies, including personal vehicle mileage. But as independent contractors, drivers receive none of these benefits.

Oh, sorry world-beating entrepreneurs, your brilliant business model — based on increasing the precarity of workers — happens to be illegal.

Many of the ills of the gig economy can be attributed to the weak social safety net. It is not just the high cost of health insurance coverage that defines precarity, it’s the lack of child care and the system where a full-time job means the employer pays half of your social security taxes. But even after accounting for the larger societal safety net questions, Uber and ride-hailing companies are taking advantage of the workers who have to take on all the liabilities of the job — car insurance, maintenance, gas, car payments — while Uber skates for free. Uber does not get a get-out-of-jail-free card because some of its workers say that the gig economy gives them ‘flexibility’, meaning a way to survive when the larger economic system has been structured to their disadvantage.

No: we need to start with the basics, like universal access to health care, childcare, and regulations that create a baseline so that those working 40 hours a week earn enough to live above the poverty line. Then we need specific protections so that gig workers do not take on the liabililties that should fall — at least in large measure — on the gig economy companies, like car insurance, gas, tolls, and so on. We need both to happen before there is anything like justice in the gig economy.

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And a few weeks later, the ride-hailing companies are scrambling, with only days before the ruling goes into effect. Kate Conger discusses the newest twists in the Uber/Lyft drivers-must-be-employees story: they are contemplating a franchise approach.

One option that both companies are seriously discussing is licensing their brands to operators of vehicle fleets in California, according to three people with knowledge of the plans. The change would resemble an independently operated franchise, allowing Uber and Lyft to keep an arms-length association with drivers so that the companies would not need to employ them and pay their benefits.
The idea would effectively be a return to the days of how groups of black cars were run. Lyft has presented the plan to its board of directors, one person said. Uber, which already works with fleet operators in Germany and Spain, is also familiar with the business model.
The companies have not committed to the franchise-like plans, said the people with knowledge of the discussions, who asked to remain anonymous because the details are confidential. Uber and Lyft are waiting to see how California’s legal situation around drivers, who have been treated as independent contractors, plays out first, they said.

This would be similar to how the companies currently operate in Spain and Germany. But this leads to a shift in branding as well as higher expenses:

Working with a fleet operator could increase costs because it introduces a third party who needs to be paid, potentially forcing Uber and Lyft to raise fares or reduce their service fees, current and former employees said. The companies would also likely have to surrender some control over driver behavior, leaving them more vulnerable to reputational damage if a driver harassed a passenger or a car was dirty.

But in economic terms, California ties off the gig economy model, since the fleet operators would have to make the drivers full-time employees, following the rules laid down by A.B. 5, the state law that closes the contractor status loophole that Uber and Lyft have been exploiting.

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Minimum Office

The Daily News Is Now a Newspaper Without a Newsroom | Marc Tracy on changes at The Daily News:

A tabloid once famous for its bustling, big-city newsroom no longer has a newsroom.
In a move that was almost unthinkable before the coronavirus pandemic, Tribune Publishing said on Wednesday that The Daily News, once the largest-circulation newspaper in the country, was permanently closing its physical newsroom at 4 New York Plaza in Lower Manhattan. The same day, Tribune, the Chicago newspaper chain that has owned The News since 2017, told employees that it was closing four of its other newspapers’ offices.
“We have determined that we do not need to reopen this office in order to maintain our current operations,” Toni Martinez, a human resources executive at Tribune Publishing, wrote in an email to the staff that was reviewed by The New York Times. “With this announcement, we are also beginning to look at strategic opportunities and alternatives for future occupancy.”
The paper will continue to be published. The company made no promises about a future physical location. “As we progress through the pandemic and as needs change, we will reconsider our need for physical offices,” said a Tribune Publishing spokesman, Max Reinsdorf.

Everyone is leaving Manhattan. Rents have dropped 10% already.

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REI looks to sell brand new Seattle-area HQ as pandemic forces retailer to rethink remote work | Taylor Soper reports on the outfitter cooperative, REI, and their embrace of minimum office:

REI was set to move more than 1,000 employees into a brand new headquarters complex built on an 8-acre site surrounded by parks and wilderness just east of Seattle in Bellevue, Wash., this summer. And then the pandemic hit.
Now the outdoor retailer is looking to sell its buildings and land in Bellevue’s Spring District, a surprising decision that reflects the rapid shift to remote work.
REI said it will move to a less centralized headquarters approach that spans multiple locations across the Seattle region. The company enacted a nearly 100% work-from-home policy for HQ staff in early March.
“The dramatic events of 2020 have challenged us to reexamine and rethink every aspect of our business and many of the assumptions of the past. That includes where and how we work,” REI President and CEO Eric Artz told employees in a video call today. “As a result, our new experience of ‘headquarters’ will be very different than the one we imagined more than four years ago.”

From Artz’s email:

The dramatic events of 2020 have challenged us to reexamine and rethink every aspect of our business and many of the assumptions of the past. That includes where and how we work.
We’ve been expanding our mobile work capabilities for the past several years in preparation for our planned headquarters move. Our progress was accelerated by the COVID-19 pandemic — we learned that the more distributed way of working we previously thought untenable will instead unlock incredible potential.
As a result, our new experience of “headquarters” will be very different than the one we imagined more than four years ago.
Rather than a single location, our “headquarters” will span multiple satellites across the greater Seattle area.
Remote working will move from a temporary solve to a more engrained, supported, and normalized model for many of our headquarters employees.
And while our home will remain in Seattle, it will be more feasible for more of our headquarters employees to have the flexibility to live and work outside of the Puget Sound region.

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A ‘work from home’ ETF may be coming soon | Paul La Monica on how to benefit from WFH: invest in it.

There’s a good chance you’re reading this story in your home office, given that the coronavirus pandemic has upended how (and where) millions of us are now working.
So it should come as no surprise that there may soon be an ETF dedicated to the rapidly growing work-from-home economy.
Fund company Direxion has filed with the Securities and Exchange Commission to launch a fund that would own companies that are likely to benefit from more people working virtually.
The exchange-traded fund would be based on an upcoming new Remote Work index from Solactive that Direxion said will likely include web conferencing leader Zoom Video Communications (ZM), cybersecurity firms Fortinet (FTNT) and Okta (OKTA) and document management software firm Box (BOX).

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Chaim Gartenberg disses Panasonic’s new Komoru home office cubicle, but I like the pegboard vibe. Only available in Japan at present.

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Elsewhere