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Legislation introduced for gig economy benefit models

May 25, 2017

US Sen. Mark R. Warner (D-VA) and US Rep. Suzan DelBene (D-WA) today introduced legislation to test and evaluate portable benefit models designed for the independent workforce. The legislation establishes a grant fund to incentivize states, localities and nonprofit organizations to experiment with portable benefits models.

The Portable Benefits for Independent Workers Pilot Program Act would establish a portable benefits pilot program at the US Department of Labor. It authorizes a total of $20 million for competitive grants to states, local governments and nonprofits for pilot projects to design, implement and evaluate new models ($15 million) or assess and improve existing models ($5 million) for portable benefits for independent workers such as contractors, temporary workers and self-employed workers.

Eligible models should provide any number of work-related benefits and protections – such as retirement savings, workers’ compensation, life or disability insurance, sick leave, training and educational benefits, healthcare, and more. In order to encourage innovative thinking on these challenging issues, programs focused solely on retirement-related benefits will not be eligible. In awarding grants, the US Secretary of Labor is directed to prioritize models that can be replicated on a large scale or at the national level.

“Whether by choice or necessity, a growing number of Americans are working without a safety net and have difficulty planning and saving for retirement, healthcare needs, or on-the-job injuries,” said Sen. Warner. “The nature of work is changing rapidly, but our policies largely remain tied to a 20th century model of traditional full-time employment.”

Sen. Warner continued, “As more and more Americans engage in part-time, contract or other alternative work arrangements, it’s increasingly important that we provide them with an ability to access more flexible, portable benefits that they can carry with them to multiple jobs across a day, a year, and even a career. These incentive grants will accelerate experimentation at the state and local levels to better support a more independent 21st century workforce.”

“With 55 million Americans freelancing, the time has come to build a new safety net to support independent workers as they move from gig to gig,” said Sara Horowitz, founder and executive director of the Freelancers Union. “The lack of portable benefits is one of the biggest impediments blocking independent workers from thriving in the new economy.”

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