It was 32 degrees in Austin,
Texas as SXSW (South by SouthWest) came
to an end yesterday. But the human hotspots at SXSW making the news
aren’t the sweaty festival goers wandering from interactive events, to music
concerts or film screenings – all a part of the ten day festival. The Human
Hotspots making the news are referred to as Homeless Hotspots. Marketing firm BBH has created a wireless
service for SXSW operated by homeless people. The company has taken 14 volunteers from a homeless
shelter in Austin, provided them with wireless devices, and t-shirts that read:
The volunteers (13 men and one
woman) are standing or walking around at locations near the Austin Convention
Centre. SXSW attendees presumably will
see the people and decide to use the service. The charge for the service was a
suggested donation of $2.00 for 15 minutes. The money would go directly to the
homeless person. There is no information
out yet as to how much usage there was, nor how much each homeless person took
in.
Here’s how the project is
described on the homelesshotspots website:
Homeless Hotspots is a charitable innovation initiative by BBH New York. It attempts to modernize the Street
Newspaper model employed to support homeless populations.
As digital media proliferates, these newspapers face
increased pressure. Our hope is to create a modern version of this successful
model, offering homeless individuals an opportunity to sell a digital service
instead of a material commodity. SxSW Interactive attendees can pay what they
like to access 4G networks carried by our homeless collaborators. This service
is intended to deliver on the demand for better transit connectivity during the
conference.
If you'd like to support Homeless Hotspots from afar, click
the button below to donate. All proceeds go directly to Front Steps Homeless
shelter.
All proceeds paid for access go directly to the person
selling you access. This is a form of income for them.
Stories about this being exploitation
of the homeless abound in the media. Most of what I have read deals with dehumanizing
aspect of turning people into hardware. BBH
Labs launched a similar and remarkably successful project in New York called Underheard
in New York in which 4 homeless men were given mobile devices and then
regularly tweeted about their experience. As a result of that project, one of
the participants reconnected with his daughter whom he hadn’t seen in years. The
projects certainly appear to have a patina of the charitable. Laudable and clever.
As all my students know, I tend
to rail against the idea of volunteering for a private corporation. Where a corporation is making a profit by
taking the free labour of a human being, it is something akin to slavery. Here BBH isn’t making a profit and the workers
are getting paid. But, of course, BBH is a marketing firm and the human
hotspots are really more valuable as mobile billboards than they are hotspot
salesmen. And, they were getting paid,
so certainly the labour wasn’t free unless no one used the service. I am not leading edge in the techno world,
but I would have thought that most people have smart phones with connections
and that the cost of logging onto their own service would be less than or similar
to the suggested donation ($0.13/min).
For those people walking around with their ipads and laptops looking for
service, maybe it works. Plus, you have
to send a text to get access to the system. My failure to understand the techno
end notwithstanding, we can, nevertheless, assume that the volunteers or, more
accurately, “workers” were to get paid something so weren’t “volunteers” in the
true sense. Moreover, subsequent to all
the media attention BBH has stated that the workers were guaranteed at least
$50.00 per day. (One blog posited that
the amount was only $20.)
In the United States the Fair
Labor Standards Act requires employers to pay at least the minimum wage, which
BBH notes in their blog that they are meeting because they are guaranteeing $50 for 6 hours. Minimum wage inTexas is $7.25. If that
is the case, then is there really much of an employment law issue here? That’s
not to say that there aren’t other issues such as the criticism about taking
advantage of the homeless and the fact that BBH is getting an enormous amount of
publicity out of this (let’s face it they’re a marketing company). But this is
not the place or time to take on the amount of value that BBH is getting nor of
the exploitation of the homeless. The BBH blog does sets out in its defence
that they are looking at ways of helping the homeless, they realize they are
being cast as villains in this, but they mean only the best. For this post, I’m going to focus on the existence
of an employment relationship.
Are the people providing this
hotspot service employees, volunteers or independent contractors? The fact that
the workers are getting paid may take them outside the domain of volunteerism,
but what the relationship is must be determined.
One tribunal set out what an
employee is in basic terms:
What are those features which go to
make up an employee in the usual sense of the term? Someone is interviewed by
an employer and hired for a job. He will work for some period of time and will be paid a fixed wage,
computed hourly, weekly or monthly.
He will perform tasks assigned by the
employer and subject to the direction and
supervision of the latter. This work is of benefit to the employer's business or enterprise. For
that reason, it is worth the while of the employer to pay for the doing of it.
If the work is performed well, it will be so evaluated by the employer, and result in the
retention or even promotion of the employee. If the work is not performed well, he will be disciplined and
perhaps even discharged, again
by the employer.
This is too simplistic a
description to meet the requirements in law but it is useful. Applying this
description to the human hotspots, it’s unlikely they were interviewed;
presumably they volunteered –in the very basic sense of that word that they
weren’t forced. But an interview isn’t a
legal requirement of an employment contract.
An offer is. There must have been an offer somehow – the workers had to
find out about it. They had to be
selected. They did work for a period of time. They weren’t paid a wage (though paying
commissions isn’t illegal under the Ontario ESA-- so to say it must be a wage computed
hourly, etc. is also not necessary legally).
Was the work to the benefit of BBH? They’re a marketing firm. They’ve managed to garner a huge amount of
publicity out of the work. As noted
above, if the human hotspots are really billboards or sandwich boards, then very
clearly, the work is to the benefit of BBH. The workers performed the tasks
assigned. There’s not enough information
known as to whether there was supervision or control; there must have been some
coordination of who would work where and when – obviously there was some control since they had to wear the
shirts and use BBH’s equipment. It’s
unlikely that they were evaluated; but would they be subject to discipline?
Surely, if one of them were to blog or tweet about BBH being an exploiter of
the homeless, presumably they would be discharged. Of course, it would be also be relatively easy
to make the opposite argument that they weren’t employees, but rather simply volunteers
or participants in a charitable project.
In
one case dealing with a charity the Federal Court held: “If the charity makes
it clear from the beginning that it cannot afford to pay anyone, then people
wishing to give of their time may very well agree to work for it as volunteers.” The focus
is on the idea of doing charitable work. The BC Court of appeal in a human rights
case also made reference to charitable work or community service work in the context
of volunteering and stated:
Given the breadth of volunteer
activity in the community, the myriad benefits it can provide and the diversity
of motivation, ranging from pure altruism and a desire to "give back"
to enlightened self-interest in developing social relationships, experience and
training, volunteerism as employment is an important question that remains for
another day.
That’s
a great description of the starting place to distinguish between employees and
volunteers – the motivation. In contract
law we refer to this as intention. Intention must always be looked at
objectively. What did the workers intend
when they took on the role? Did they intend that that their efforts would be
serving the greater good somehow? In a case involving the Salvation Army, the
court made it clear that the officers of the Salvation Army were there to serve
God as their primary motivation or intention, not to work. That motivation may often be easy to see with
charitable works. But almost always, when the corporation is a profit making
institution, the worker’s intention is to either get paid or earn an
opportunity to get paid.
I
don’t think any of the workers here intended that walking around Austin
providing festival goers with internet access to be a gesture of altruism or a
desire to give back; they were doing it for the money. They were working at a
10 day job for which they expected or hoped to get paid.
The
next step in determining whether similar activity would make the workers
employees here in Ontario, would be to look at the Employment Standards Act. Section 1of the Act provides:
“employee” includes,
(b) a person who supplies services to an
employer for wages,
(c) a person who receives training
from a person who is an employer, as set out in subsection (2),
“wages” means,
(a) monetary remuneration payable
by an employer to an employee under the terms of an employment contract, oral
or written, express or implied,
(b) any payment required to be
made by an employer to an employee under this Act, and
Arguably one doesn’t have to go any further than this
definition. The workers are providing services for remuneration. This would definitely
be the case if the money paid by the wireless user gets paid to BBH first and
then in turn given to the worker.
If the money comes directly from the end user, then it
might be argued that BBH is not paying remuneration. Nevertheless, that doesn’t
end the issue because if an employment relationship does exist, then section 1(b)
further adds that wages are those payments required to be made under the Act. Section 23 of the Act provides that “An
employer shall pay employees at least the prescribed minimum wage.” Rather obviously, not paying doesn’t relieve
the employer of the obligation to pay. I
have heard about restaurants doing this with servers saying that they are
volunteers and do not have an employment relationship, but attend for the
purpose of getting tips. I haven’t found any cases on this point, but the
question of tips has come up in a case regarding Pay Equity. There, the
tribunal stated:
. . .the
tips are not provided by employers, who are the ones typically responsible for
determining the level and nature of compensation, and are certainly the
entities responsible for meeting the obligations under the Act. So
leaving aside for the moment the question of whether tips in any given
situation are “ascertainable”, does the definition of compensation include
those payments made by clients or customers who are not obliged to make the
payments, have no obligation to meet the requirements of the Act and are
essentially strangers to the employment relationship?
In other words an employer can’t meet its obligation
under the Act by saying that the wages owed are coming from a 3rd
party in the form of tips. Indeed, the ESA expressly excludes tips from the
definition of wages so that employers cannot avoid their obligations to pay at
least the minimum wage. So the question
remains as to whether the employment relationship exists in the first place. If
it does, then donations from 3rd parties to the human hotspots would not meet
the obligation of the employer to pay the minimum wage over and above the
donations.
In interpreting statutes with respect to
whether an employment relationship exists, some cases suggest a statutory
purpose test be used. It has been said that the purpose of Employment Standards
legislation is to avoid exploitation of workers. Given this purpose and the facts around the human
hotspots, I would say that the proper interpretation is that they are
employees.
Nevertheless, that may not end
the debate; an employment relationship may not exist where the person providing
the service is an independent contractor rather than an employee. There are a number of tests that the courts
use to answer this question. The tests
typically set out are: control, four fold, entrepreneur, enterprise/risk,
economic realities and statutory purpose. I’ll save a discussion of these tests
for another post.
Suffice it to say at this point
that in my view, that the threshold would not be met and the workers standing
out there in the Austin heat would be employees – even if only for the limited
term of 10 days while SXSW runs.