The gig economy has a problem. Freelancing is increasingly common, but it’s still difficult and costly to access benefits without a 9-to-5 job. For the lowest-paid workers, it can be close to impossible. In the past few years, many have seized on the idea of “portable benefits": insurance and paid time off not bound to a single employer. In 2015, dozens of academics, entrepreneurs, and CEOs—including the cofounders and CEOs of Lyft, Handy, and Instacart—signed a manifesto calling for such a system. Last year, Senator Mark Warner (D-Virginia) introduced legislation that would offer grants to states, cities, and community groups to create pilot programs of portable benefits. In February, representatives in Washington state reintroduced a bill to create a state portable benefits system; soon after, Uber CEO Dara Khosrowshahi cosigned a public letter affirming the need for such a system. But for all the talk, there’s been little action. That’s beginning to change. Since March, Fair Care Labs—the innovation arm of the National Domestic Workers Alliance, which organizes and advocates for domestic workers—has been quietly testing a portable benefits tool, developed with the help of a grant from Google.org. Domestic workers have long grappled with many of the issues plaguing the gig economy today. The Fair Labor Standards Act of 1938, which created the right to a minimum wage and overtime pay, initially excluded domestic workers; in the 1970s, the law expanded to include some domestic workers, but it still excludes babysitters and companions to the elderly. Domestic workers, like all independent contractors, cannot unionize or bargain collectively. Over the past several years, states including California, New York, and Massachusetts have enacted laws granting domestic workers rights to overtime pay and paid time off; however, those laws are challenging to enforce, and there are still few federal protections. According to a 2017 study conducted in part by the NDWA, 23 percent of domestic workers are paid below their state’s minimum wage, and 70 percent earn less than $13 per hour. Like workers in the gig economy, most domestic workers are paid by multiple employers, none of whom is incentivized to offer benefits. In other words, the workforce is the perfect proving ground for a portable benefits system that could have broader applications. Fair Care Labs’ tool, dubbed Alia, is initially designed for use by house cleaners, who typically work for a number of clients. Alia pools voluntary contributions from those clients, who each contribute at least $5 per cleaning; each cleaner can then use her pool of funds to redeem various benefits. Fair Care Labs has partnered with insurance company Colonial Life to offer life insurance, disability insurance, and accident and critical illness insurance. Workers can also redeem paid time off, at $120 per day. In developing Alia, project lead Sam Witherbee spoke with dozens of cleaners, some who worked independently and others who worked through platforms such as Handy and Homejoy (before it shut down in 2015). They shared their stories about living without basic benefits like paid time off. He also spoke with people who hire cleaners—and learned that for the most part, they wanted to do the right thing. They just didn’t know where to begin. “If you make it easy, they’ll jump on it,” says Palak Shah, the founding director of Fair Care Labs and social innovations director at NDWA. Workers using Alia describe the relief of having some sort of safety net, if small. Instead of continuing to work when they're sick or delaying medical care, even workers without savings can take time off and see a doctor. “I wanted to have a backup plan, if something ever happened to me,” says Olivia Mejia, who has worked as a cleaner for 10 years and supports three children. With Alia in place, Mejia says, she was able to attend her daughter’s high school graduation this spring, which conflicted with her work schedule. In the past, she would have had to weigh the costs of missing a milestone event or missing a day’s pay.
A portable tool that pools voluntary contributions from clients employing house cleaners enabling workers to redeem various benefits has been trialed by Fair Care Labs, the innovation division of US advocacy group the National Domestic Workers Alliance. The “Alia” tool has been developed using a grant from Colonial Life. The system also enables workers to redeem paid time off at $120 per day. Fair Care Labs has also joined with insurance firm Google to provide accident and critical illness, disability and life insurance to such workers.