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This paper presents a model and evidence regarding the incidence of independent contractors and the self-employed. It focuses on the rights to control the work routine as an important issue distinguishing employee and non-employee workers. The conditions under which it is optimal for the buyer of labor services to control the work routine (and use employees) and when is it desirable for the seller to have control are considered. The model emphasizes the costs of measuring worker output vs. monitoring worker effort, worker expertise, and worker investment and is tested with Current Population Survey data merged with the Dictionary of Occupational Titles. The empirical findings are broadly consistent with the approach. Independent contractors tend to be in jobs that are harder to monitor and having more worker expertise such as jobs involving more intellectual skills, having a greater variety of duties, and requiring more worker expertise and training. This is even more true of the other self-employed. We also review existing empirical research on self-employment, discussing how it fits into our baseline model and evaluating the arguments to explain independent contractors and self-employment. These include a desire to reduce fringe benefits, demand and staffing uncertainty, wanting to avoid lawsuits for wrongful termination, a desire to protect a reputation for not laying-off employees, credit constraints, and worker desire for flexibility. There is strong evidence that credit constraints have a substantial influence on self-employment status and likewise for worker desire for job flexibility. The literature suggests that the desire to avoid payment of fringe benefits, demand and staffing variability, and avoidance of potential wrongful dismissal lawsuits induces firms to use more temporary agency workers but does not seem to affect the use of independent contractors.

The purpose of this paper is to identify whether, through the eyes of standard skilled employees and job applicants, differences exist between different types of non‐standard skilled workers.

Data were taken from a large survey of US‐based companies measuring the amount of work being completed by skilled independent contractors and outsourcing agencies. These data were then used in regression models predicting employee turnover and the time needed to fill vacancies in these positions.

The results suggest that different types of non‐standard workers will have differing effects on skilled standard employees' and job applicants' behaviors. Organisations using independent contractors appear to achieve short‐term staffing flexibility, but these organisations may have more difficulty filling job vacancies. Organisations using outsourcing arrangements may not see any changes in their skilled standard employees' or job applicants' behaviors.

The study specifically measures the differences between diverse non‐standard work arrangements. It adds to the literature on the effects these work arrangements have on standard employees. It is the first to consider the job applicants' interpretations of potential employers using non‐standard workers in their field of work.

Worker classification continues to be a highly litigated area of taxation. That is, the status of a worker as an employee or independent contractor remains a topic closely scrutinized by the Internal Revenue Service. This study examines factors that the judiciary deems relevant in ruling whether a worker is an employee or independent contractor. A backward stepwise logistic regression model is implemented to categorize the factors that best predict the court’s decision on whether a worker is either an employee or independent contractor pursuant to the factors in Revenue Ruling 87-41 (1987-1 CB 296), judge gender, and political affiliation. The results indicate three factors (supervision/instructions, continuing relationship, and the right to discharge) are capable of accurately predicting 93 percent of the decisions made by the US Tax Court. Other findings support notable statistical differences between male and female judges rendering decisions and reaching conclusions. Also, there is a statistically significant difference based on the type of industry. Political affiliation appears to have no significant impact on judicial rulings.

Farm labor contractors operate as intermediaries between farmworkers and agricultural employers by recruiting and supplying labor to US farms. In a political economy where there are employer sanctions for hiring workers without proper documentation, contractors share risk alongside final employers. Furthermore, contractors may facilitate quick employment matches during time sensitive agricultural tasks such as harvesting. For undocumented workers, using a contractor may decrease uncertainty associated with a foreign labor market and ease language barriers. The purpose of this paper is to examine the current role of labor contractors in delivering immigrant agricultural workers, particularly undocumented workers, to farms.

Determinants of labor contractor use and relationships to final worker outcomes are examined using econometric methods and a large nationally‐representative worker survey that is distinctive in that it distinguishes legal status.

Undocumented farmworkers are shown to be more likely to use contractors than are documented workers, though statistical significance is sensitive to the inclusion of crop and task indicators, and wages and fringe compensation to workers who use contractors are lower, even after controlling for legal status.

The paper contributes to limited recent academic work on the role of labor contractors in US agriculture. Future work may examine ongoing changes to this role in the context of mutable immigration policy and public opinion.

It is argued that the decline in labor contracting increases the need for employer‐level bilingual communication skills and compliance with labor regulations.

Understanding current dynamics of the agricultural labor market should be of value to scholars of rural economies, farm owners and agricultural policymakers.

Classifying workers as either employees or independent contractors has significant financial consequences for the payer (usually a business) and the worker. The payer may be motivated more by the desire to avoid paying for employee benefits and employer payroll taxes than by doing the right thing and correctly classifying and paying the worker as an employee. Estimates are that the cost of such benefits and taxes may equal 20–30% of gross pay. When governmental regulations are unclear or enforcement is lax, many stakeholders suffer. This includes the workers, their families, their co-workers, and law-abiding employers as well as citizens (taxpayers) who must pay more than their fair share to provide adequate funding for related government programs and benefits. This is a global issue as evidenced by widely publicized lawsuits in many countries involving prominent defendants such as Microsoft, Uber, and Lyft. Software platforms used to distribute small jobs to temporary and part-time workers have resulted in the exponential growth of the gig economy. Such technology has also further enabled the misclassification of workers beyond what has occurred in years past. An ethical analysis to identify the many stakeholders and the impact of worker misclassification should be conducted to guide governments in developing and enhancing regulations for the pervasive issue of worker classification and to protect the rights of their workers and taxpayers.

According to Marx, capitalism leads to the alienation of people from their work, from the product of their work, and from other people (Oilman, 1976:133–4). These characteristics of capitalism were obvious for all to see in the late nineteenth century, as capital and labor were increasingly polarized. But in the late twentieth century, class relations have become considerably more complicated. The emergence and growth of various forms of “middle class” (Walker, 1979; Wright, 1985) make the issue of who is exploiting whom, of who benefits from the alienation of workers, unclear. In turn, the confusion in class relations has an effect on the ability to wage class struggle, as the “enemy” of the working class is difficult to define, let alone target.

Traditionally, hiring indefinite duration contract employees has been the dominant method used by U.S. organizations to staff their labor needs. Indefinite duration contract employees, hereafter referred to as “regular” employees, have three defining characteristics: (1) they are hired directly as employees of the organization whose work they perform; (2) the duration of the employment relationship is unspecified, with a mutual expectation that it will continue as long as it is mutually satisfactory; and (3) the employment relationship provides ongoing – as opposed to intermittent – work. When their demand for labor increases, organizations staffed exclusively by regular employees can respond by having their employees work overtime or by hiring additional regular employees. Conversely, when their demand for labor decreases, such organizations can either maintain “inventories” of excess regular employees or reduce labor inputs by laying-off or reducing the work hours of regular employees.

Unlike the effect of management styles on employee attitudes, little is known about the effect of managerial assumptions on workers within the gig economy. The purpose of this paper is to utilize McGregor’s Theory X and Theory Y as a framework to discuss two gig economy platforms and how their differing management assumptions affect worker perceptions of themselves as entrepreneurs.

The author utilized qualitative interviews and demographic surveys with 41 contract workers from TaskRabbit, a personal assistant platform, and Kitchensurfing, a “rent-a-chef” service, to examine the impact of differing management assumptions on independent contractor perceptions of themselves as entrepreneurs.

The Theory X management assumptions and correlated behaviors directly contradict the entrepreneurial ethos marketed by the platforms, resulting in a psychological contract violation for workers and negative responses to the platform. In comparison, Theory Y managerial assumptions and correlated behaviors can be utilized to encourage worker innovation, creativity and sense of self as an entrepreneur.

As the gig economy continues to grow, algorithms are likely to take on increased importance as a management tool. Although some have suggested that such algorithms may reduce the impact of a capricious manager, the fact remains that algorithms are created by management. If the gig economy intends to encourage entrepreneurship, additional attention must be paid to how differing management assumptions, and their resulting behaviors and algorithms, affect worker attitudes and experience.

This study represents one of the initial academic investigations into how the Theory X and Theory Y management assumptions and correlated perspectives may be applied to independent contractors within the gig economy. Additionally, this study is among the first to examine how gig worker attitudes toward platform firms, and views of themselves as entrepreneurs, are affected by algorithm-implemented management policies.