Advocates for increasing minimum wage rates around the country argue that the current federal rate is insufficient to cover expenses in many American cities. A campaign known as the “Fight for $15” seeks to raise the minimum wage to $15 nationwide. Under newly-enacted legislation, the New Jersey minimum wage will gradually increase to $15 per hour over several years. As advocates succeed in this effort, however, the workforce is undergoing changes that could lessen the impact of their success. Workers in the “gig economy” are often classified as independent contractors rather than employees, or they only work part-time. Either way, many are excluded from a wide range of protections under federal and state employment laws, including minimum wage. Recent news reports have shown, however, that workers and their advocates are fighting for better terms.
The federal minimum wage last increased on July 24, 2010, from $6.55 to $7.25 per hour. 29 U.S.C. § 206(a)(1)(C). New Jersey’s minimum wage has been higher than that for some time. A new law signed by the governor in February 2019 will increase the minimum wage for many New Jersey workers to $10 per hour on July 1. On the first day of 2020, it will increase to $11 per hour. A $1 increase will follow on January 1 of each following year until the rate reaches $15 per hour in 2024. See N.J. Rev. Stat. § 34:11-56a4, as amended by P.L.2019, c.32. The definitions provided by state wage laws, however, continue to omit many gig economy workers. An “employee” is still simply “any individual employed by an employer.” Id. at § 34:11-56a1(h).
The term “gig economy” has no distinct definition, but generally refers to individuals who work for companies on a job-by-job basis. This includes people who provide freelance services to multiple clients, but also people who provide services to customers of companies like Uber or Instacart. Driving for a ridesharing company might look like a full-time job. On paper, the relationship between the two parties is not employer/employee, but employer/independent contractor.