It is universally accepted that when a company merges with another company, the layoffs are bound to happen. However, as mergers and acquisitions are becoming common in the gig economy, it is leaving contractors in the cold.
Buzzfeed Reported that after Uber acquired Postmates in excess of $ 2 billion, some of Postmates’ gig workers could be left without jobs. This is partly thanks to Uber’s more stringent rules and regulations for its drivers.
However, according to economists, Uber and Postmates mergers, as well as increased mergers between companies, can bring bad news for gig workers and the job side of the gig economy in general. Pay attention to what the merger means for the future of the contract work.
Think of the little man
After the merger, Postmates contractor Ray Adams applied for the same job, but with UberEats. Surprisingly, UberEats rejected him. Why? There was an old careless driving charge on his record that he had previously pleaded to improper driving.
Reckless driving charges will disqualify Uber from Adams, as stated in Uber’s website: “Recent history of major driving violations or numerous minor driving violations, including but not limited to accidents without fault. Is, may result in disqualification. ” Buzzfeed It was explained that Adams had tried to improve his background check with Uber’s background check company Checker, and that he was waiting to hear back.
“If I haven’t been accepted by any other delivery service, it would be very devastating to my income. It was like a slap in the face.” Adams said.
This is an even bigger slap in the face when you consider it: Gig workers are often not eligible for unemployment insurance like people with regular jobs do. If they live in the US, they usually have to pay for their health benefits as well. Suddenly losing a well-paying gig can be disastrous for a contractor’s bottom line as soon as their job disappears.
After joining Fender-Bender, Colorado Postmates driver Adam Rosenthal was disqualified to get a job with Uber. After the acquisition of Postmates, he had to drive with Grubh. Unlike UberEats or Postmates, Grubhub does not offer same-week salaries, so Rosenthal explained that he would have to work harder to put gas in his car. “I need to drive before putting gas in the car and buying food for myself and cats.”
Even if the postmates employee is not on the chopping block, they can wait to board the ship, they have to spend a job and money every day. Postmates career Taya told in Texas Buzzfeed No formal announcement was made about the merger of Postmates Workers, and elaborated that it waited eight days for UberEats.
“I wish it was some kind of announcement email sent months ago stating that apps would be merged and postmates would no longer exist”, she expressed. “I think there is a perception that we just knew on the basis of Uber buying the company.”
Another postmates driver Matthew Miller told Buzzfeed That although his driving record is clear, his background check is taking longer, meaning he is missing his normal thirty-five forty-hour work week and the salary that accompanies him. “They sent me several automated emails saying that background checks are taking longer than usual. My record is absolutely clear, so I don’t know what the holdup is. ”
Less competition, no profit
University of Utah economist Marshall Steinbaum explained: Buzzfeed: “Like any labor market, the less competitors you have for labor, the fewer places you will have work, [which] Increases boss power over employees. They are not really able to enjoy what the benefits of being an independent contractor should be. . . To work for whoever is offering you the best deal on any one platform. ”
One benefit of gig work reported by companies like Uber – and gig workers themselves – is the ability to set their own hours. However, according to some experts, large companies such as Uber have ended up competing against each other over business gig workers, who also claim that the Federal Trade Commission has more to review the merger before advancing it Should have taken time. .
Although Uber did not comment on the FTC’s decision, a spokesman said Buzzfeed: “As we work to integrate Uber Eats and Postmates, the priority has been in maximizing earning opportunities for people with more deliveries — without compromising Uber’s commitment to safety”, further readers. Assuring that they were attempting to make the acquisition “as seamless as possible”. ”