Annals of Workers Comp: Sort of Comp?
When is disability coverage for workers not quite workers comp? When it's part of an optional program that covers workers who are not quite employees. Confused? Read on.
Uber, in the news lately for the wrong reasons, has taken steps to provide a disability program for its drivers (who are still not employees of Uber). Through a program offered by OneBeacon, drivers can opt into coverage that would pay medical bills and lost wage benefits for injuries that occur while drivers are heading toward customers or while customers are in their vehicles. The general benefit parameters are impressive - medical costs up to $1 million, replacement earnings up to $500 per week, survivor benefits up to $150,000. But the devil, as usual, will be in the details.
Unlike workers comp, which is mandatory and does not cost employees anything, this optional coverage will be paid for by Uber drivers and their customers. And unlike comp, only drivers who opt in will be covered. In workers comp, compensability is determined by a combination of statute and case law. Here, coverage will be at the whim of the carrier, with very limited avenues for appeal if benefits are reduced or denied.
Here's a somewhat inflammatory analysis of the new program by Rebecca Smith, deputy director of the National Employment Law Project:
“Uber’s latest attempt to shore up its faltering image is a lot like its other moves: another shakedown by a company that is becoming famous for taking advantage of workers, as well as regulators and customers.
“Insurance is a good thing: Taxi jobs are among the most dangerous in the country, with five times the rate of death on the job as other occupations. But instead of paying workers’ compensation premiums to cover all of its workers, as responsible businesses do, Uber will charge drivers for the medical care and time-loss benefits that the rest of us get by virtue of working at a job. And though consumers are assured that they are paying for workers’ insurance, that will only be true for the drivers who opt in.”
I'm not convinced that Uber drivers share the same risk as taxi drivers, as there is no cash involved in the transaction. That being said, while Uber deserves some credit for offering this coverage to their drivers, it falls far short of the robust protections offered by workers compensation. In the Gig economy, not-quite employees must make do with no benefits, or benefits that significantly diminished, to say the least.
Senior Workers Compensation Consultant