The New York Times
CAMBRIDGE, Mass. -- Linda Chavez, George W. Bush's pick for labor secretary, withdrew as the nominee Tuesday after facing a blizzard of questions concerning Marta Mercado, a Guatemalan woman who, as an undocumented alien, lived in Chavez's home during the early 1990s and did some work for the family. Chavez didn't pay Social Security taxes on Mercado's labors.
Have we been here before?
No, said Chavez. She never actually employed Mercado. The entire transaction between them amounted to nothing more than the woman's doing a few chores around the house and getting in return some "spending money" - no more than a couple of thousand dollars. A spokesman for Chavez said it was just a matter of helping someone "down on her luck."
The distinction Chavez appeared to make turns on a definition - as do so many other pertinent legal distinctions these days. Is someone who receives free rent and a few thousand dollars for doing chores around your home an "employee" under the labor laws - entitling that person not only to Social Security but also to a minimum wage, time- and-a-half for putting in more than 40 hours a week and a reasonably safe workplace, among other things?
It's not a simple matter. These days, who works for whom is one of the most complicated questions in the emerging economy. Tens of millions of temporary workers, part-timers, free-lancers, e-lancers, independent contractors and free agents - already estimated to constitute one-tenth to one-third of America's civilian labor force - are not technically "employees," under many labor laws that impose legal obligations on employers.
Most labor laws were enacted at a time when "employees" and "employers" were easily recognizable. Organizations were shaped like pyramids with a few executives at the top, a wider layer of middle- level managers and staff and a large number of workers at the bottom. You were either an employee or you weren't. And if you were, you were either a manager or an hourly worker.
Now, bureaucratic structures and definitions no longer apply to large numbers of workers. Broad constellations of designers, suppliers, marketers, financial specialists, contractors and shippers function as employees in a single enterprise at one point, only to split off separately afterwards to join new constellations of employees. Giant companies can operate from single floors leased in office buildings and contract out for everything they do.
In a few years, a company may be best defined by who has access to what data and who gets what portion of a particular stream of revenues, over what period of time. There may be no "employees" at all, strictly speaking.
Meanwhile, overworked two-earner couples are madly subcontracting to other people much of what families used to do for themselves. Here too, it's getting harder to discern traditional employer-employee relationships because the people who are hired also tend to work for many others.
Some take care of children, others come into the home to cook, clean or even assemble bookshelves and entertainment centers. Increasing numbers of people provide coaching, counseling and personal training. The do-it-yourself trend of the 1950s has been all but replaced by the hire-someone-to-do-it trend of the 2000s - although the hired person may not be an employee.
Courts are brimming with lawsuits over who works for whom, and who's entitled to legal protections as a result. Microsoft just settled a big case with a large fleet of temps who claimed they were, in fact, regular Microsoft employees. But it's also occurring on a smaller scale, as people who have provided specific services turn around and sue their putative employers for the back pay or health care they say they are due or for injuries they claim occurred because of employer negligence.
The law is muddled because the economic ground is shifting so fast. These days, someone who hires someone else to do a job has been interpreted by some courts to be an "employer" if he or she owns the equipment used on the job and the place where the work is done and provides a significant portion of the hired person's income (including an in-kind benefit like a place to sleep). But these criteria aren't definitive, nor are they the only ones the courts are using.
Did Linda Chavez "employ" her Guatemalan guest? I don't know.
This is precisely the problem. The labor laws that were enacted many decades ago when the economy was different are in the process of being adapted to a new economy - not only though new laws but, far more frequently, through rules, advisory opinions and administrative orders issued by the Labor Department, as well as through the speeches and pronouncements of the secretary.
A secretary of labor has to make a lot of decisions about what policies to advance, which cases to bring and whom to protect. But the bottom line is that the labor secretary has to look out for the rights of people who are working - regardless of technical definitions or of which way the labor markets are moving. And that may mean erring on the side of declaring people "employees" so that they can get the protection they need.
