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THE DISRUPTER SERIES: HOW THE SHARING 

ECONOMY CREATES JOBS, BENEFITS CONSUMERS, AND RAISES POLICY QUESTIONS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON COMMERCE, MANUFACTURING, 

AND TRADE 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

SEPTEMBER 29, 2015 

Serial No. 114–80 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

COMMITTEE ON ENERGY AND COMMERCE 

FRED UPTON, Michigan 

Chairman 

JOE BARTON, Texas 

Chairman Emeritus 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOSEPH R. PITTS, Pennsylvania 

GREG WALDEN, Oregon 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

Vice Chairman 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

CHRIS COLLINS, New York 

KEVIN CRAMER, North Dakota 

FRANK PALLONE, JR., New Jersey 

Ranking Member 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

DORIS O. MATSUI, California 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

PETER WELCH, Vermont 

BEN RAY LUJA ́ N, New Mexico 

PAUL TONKO, New York 

JOHN A. YARMUTH, Kentucky 

YVETTE D. CLARKE, New York 

DAVID LOEBSACK, Iowa 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

SUBCOMMITTEE ON COMMERCE, MANUFACTURING, AND TRADE

MICHAEL C. BURGESS, Texas 

Chairman 

LEONARD LANCE, New Jersey 

Vice Chairman 

MARSHA BLACKBURN, Tennessee 

GREGG HARPER, Mississippi 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

GUS M. BILIRAKIS, Florida 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

FRED UPTON, Michigan (ex officio) 

JANICE D. SCHAKOWSKY, Illinois 

Ranking Member 

YVETTE D. CLARKE, New York 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

BOBBY L. RUSH, Illinois 

G.K. BUTTERFIELD, North Carolina 

PETER WELCH, Vermont 

FRANK PALLONE, JR., New Jersey (ex 

officio) 

(II) 

(III) 

C O N T E N T S 

Page 

Hon. Michael C. Burgess, a Representative in Congress from the State of 

Texas, opening statement .................................................................................... 1 

Prepared statement .......................................................................................... 2 

Hon. Janice D. Schakowsky, a Representative in Congress from the State 

of Illinois, opening statement .............................................................................. 3 

Prepared statement .......................................................................................... 4 

Hon. Fred Upton, a Representative in Congress from the State of Michigan, 

opening statement ................................................................................................ 5 

Prepared statement .......................................................................................... 6 

Hon. Frank Pallone, Jr., a Representative in Congress from the State of 

New Jersey, opening statement .......................................................................... 71 

Prepared statement .......................................................................................... 72 

WITNESSES

Luceele Smith, Driver/Partner, Uber Technologies, Inc. ...................................... 7 

Prepared statement .......................................................................................... 9 

Michael Beckerman, President and Chief Executive Officer, Internet Association ........................................................................................................................ 10

Prepared statement .......................................................................................... 12 

Robert Passmore, Assistant Vice President, Personal Lines, Property Casualty 

Insurers Association of America ......................................................................... 24 

Prepared statement .......................................................................................... 26 

Dean Baker, Co-Director, Center for Economic and Policy Research ................. 29 

Prepared statement .......................................................................................... 31 

Alex Chriss, Vice President, QuickBooks Self-Employed Segment, Intuit, Inc. . 43 

Prepared statement .......................................................................................... 45 

Jonathan Lieber, Chief Ecoomist, Thumbtack, Inc. .............................................. 55 

Prepared statement .......................................................................................... 57 

SUBMITTED MATERIAL

Statement of Vaughn Armour of Brooklyn, New York, undated, submitted 

by Ms. Schakowsky .............................................................................................. 92 

Statement of New York Taxi Workers Alliance by Inder Parmar, September 

29, 2015, submitted by Ms. Schakowsky ............................................................ 93 

Statement of Taxicab, Limousine & Paratransit Association by Mike Fogarty, 

President, September 29, 2015, submitted by Ms. Schakowsky ...................... 95 

Statement of Working Partnership USA of San Jose, California, undated, 

submitted by Ms. Schakowsky ............................................................................ 103 

Statement of American Hotel & Lodging Association, September 29, 2015, 

submitted by Mr. Burgess ................................................................................... 105 

Letter of September 28, 2015, from Joseph E. Spinnato, President, and Vijay 

Dandapani, Chairman of the Board, Hotel Association of New York City, 

to Mr. Burgess and Ms. Schakowsky, submitted by Mr. Burgess .................... 108 

Statement of Texas Hotel & Lodging Association, September 29, 2015, submitted by Mr. Burgess ......................................................................................... 122 

Statement of National Limousine Association by Gary Buffo, President, September 29, 2015, submitted by Mr. Burgess ...................................................... 124 

(1) 

THE DISRUPTER SERIES: HOW THE SHARING 

ECONOMY CREATES JOBS, BENEFITS CONSUMERS, AND RAISES POLICY QUESTIONS 

TUESDAY, SEPTEMBER 29, 2015 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON COMMERCE, MANUFACTURING, AND

TRADE, 

COMMITTEE ON ENERGY AND COMMERCE, 

Washington, DC. 

The subcommittee met, pursuant to call, at 10:18 a.m., in room 

2322 of the Rayburn House Office Building, Hon. Michael C. Burgess (chairman of the subcommittee) presiding. 

Members present: Representatives Burgess, Lance, Blackburn, 

Harper, Guthrie, Olson, Pompeo, Kinzinger, Bilirakis, Brooks, 

Mullin, Upton (ex officio), Schakowsky, Clarke, Kennedy, 

Butterfield, Welch, and Pallone (ex officio). 

Staff present: James Decker, Policy Coordinator, Commerce, 

Manufacturing, and Trade; Andy Duberstein, Deputy Press Secretary; Graham Dufault, Counsel, Commerce, Manufacturing, and 

Trade; Melissa Froelich, Counsel, Commerce, Manufacturing, and 

Trade; Paul Nagle, Chief Counsel, Commerce, Manufacturing, and 

Trade; Olivia Trusty, Professional Staff Member, Commerce, Manufacturing, and Trade; Dylan Vorbach, Legislative Clerk; Michelle 

Ash, Democratic Chief Counsel, Commerce, Manufacturing, and 

Trade; Jeff Carroll, Democratic Staff Director; Lisa Goldman, 

Democratic Counsel; Meredith Jones, Democratic Director of Communications, Member Services, and Outreach; and Adam 

Lowenstein, Democratic Policy Analyst. 

Mr. BURGESS. The Subcommittee on Commerce, Manufacturing, 

and Trade will now come to order. The Chair recognizes himself for 

5 minutes for the purpose of an opening statement. 

OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS 

Good morning, and I want to welcome everyone to our hearing 

this morning on the sharing economy. We are lucky to be here this 

morning to be able to talk about a sector of our economy that is 

actually putting people to work. 

All of us here on the dais endure the typical Government skirmishes. We spend a lot of time quibbling over the proper size and 

the proper role of the Federal Government, so today it is refreshing 

to remind ourselves that the private sector is often working to solve 

problems even in spite of us some days. And we are doing that— 

2 

and the private sector is doing so in a way that fosters jobs through 

innovation. 

The opportunities sharing platforms provide are often in addition 

to, not necessarily instead of, the streams of income available 

through traditional employment sources. The sharing economy has 

captured the entrepreneurial spirit of many Americans already. 

Those who engage in freelance jobs are expected to skyrocket to 40 

percent of the workforce in the next 5 years, and almost 8 million 

will be participating in a sharing economy. 

The sharing economy is an excellent example of why the fight exists for smaller Government. I want to hear today about how technology has built in accountability and built in consumer protections 

into their platforms, because eventually we must confront the question of whether and how Congress responds to these types of firms. 

Many suggest no action is warranted, either by Congress or local 

regulators, and others are seeking direct and immediate intervention both at the Federal and the local level. There should be some 

limited Government oversight, particularly where safety is significant, and firms should be thinking about privacy, firms should be 

thinking about cybersecurity from the outset, lest they invite the 

very type of regulation that they sought to avoid. 

But generally speaking, the sharing economy companies do face 

regulations, like most other firms, under the typical patchwork of 

Federal and State laws, and I, for one, am more concerned about 

existing regulations hurting new jobs than I am about the need for 

new regulations. The CEI estimates that the Federal Government 

already has stifled progress through regulation to the tune of almost $2 trillion per year. Meanwhile, the sharing economy has generated $15 billion in global revenues in 2013, and is likely to generate $335 billion annually by the year 2020. We should be highly 

skeptical of interventions that take away new conveniences and 

measurable benefits for consumers. 

Sharing platforms are inherently good, providing reputation feedback loops. As we look at any disrupter, we should ask ourselves, 

is more regulation needed, or is someone just concerned about 

change, and worried about change of the status quo? 

I want to thank the witnesses for participating. I look forward 

to a lively and informative discussion. I will yield back my time, 

and recognize the ranking member of the subcommittee, Ms. 

Schakowsky, for 5 minutes for an opening statement. 

[The prepared statement of Mr. Burgess follows:] 

PREPARED STATEMENT OF HON. MICHAEL C. BURGESS

Good morning and welcome to our hearing on the sharing economy. We are lucky 

to be here this morning to be able to talk about a sector of the economy actually 

putting people to work. 

All of us here on the dais endure the typical Government skirmishes—here in 

Washington we spend a lot of time quibbling over the proper size and role of Government. 

So it is uniquely refreshing for us to remind ourselves that the private sector is 

often working to solve the same problems we are and doing so in a way that fosters 

jobs through innovation. 

The opportunities sharing platforms provide are often in addition to—not necessarily instead of—the streams of income available through traditional sources. 

The sharing economy has captured the entrepreneurial spirit of many Americans 

already. Those who engage in freelance jobs are expected to skyrocket to 40 percent 

3 

of the workforce in the next 5 years—about 7.8 million of which will be participating 

in the sharing economy. 

The sharing economy is an excellent example of why I fight for smaller Government. And I want to hear about how technology has built in accountability and consumer protections into the platform. 

Because eventually we must confront the question of whether and how Congress 

responds to these types of firms. 

Many suggest no action is warranted either by Congress or local regulators, and 

others are seeking direct and immediate intervention from Congress. 

There should be some limited Government oversight, particularly where safety is 

needed. And firms should be thinking about privacy and cybersecurity from the outset, lest they invite the very regulation they would rather avoid. But generally 

speaking, the sharing economy companies do face regulations, like most other firms, 

under the typical patchwork of Federal and State laws. 

And I for one am more concerned about existing regulations hurting new jobs 

than I am about the need for new regulations. CEI estimates that the Federal Government has already stifled progress enough through regulation—to the tune of $1.8 

trillion per year. Meanwhile, the sharing economy generated $15 billion in global revenues in 2013 and will generate $335 billion annually by 2020. 

We should be highly skeptical of interventions that snatch away new conveniences 

and measurable benefits for consumers. Sharing platforms are inherently good at 

providing reputation feedback loops. 

As we look at any disrupter, we really need to ask is regulation needed or is someone just scared of a change to the status quo? 

I thank the witnesses for participating and look forward to a lively and informed 

discussion. 

OPENING STATEMENT OF HON. JANICE D. SCHAKOWSKY, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS 

Ms. SCHAKOWSKY. Thank you, Mr. Chairman, for holding this 

hearing on the sharing, some call gig, economy. This is a topic absolutely deserving of our attention, discussion, scrutiny. 

Over the past few years Americans have begun to interact in 

ways we never imagined just a decade, or even less, ago. The sharing economy is one of the byproducts of technological change. Today 

people hail rides, book rooms, hire a contractor, purchase groceries, 

at the push of a button. This is the fastest growing sector in our 

economy, and while there is undoubtedly a convenience factor for 

those engaged with the gig economy, there are a number of adverse 

consequences as well. 

For many millennials the gig economy model of employment may 

be appealing for a time, providing scheduling flexibility that many 

young people desire. But for many older workers, who used to have 

full time employment, or younger workers, seeking steady full time 

work, this transformational change is not always positive. The 

model of this economy, where people—there are people seeking economic predictability and stability, also—often eliminates benefits, 

like health care and pensions, and it means more questions about 

whether they can make ends meet, much less save for their children’s education, their parents’ elder care, or their own retirement. 

The gig economy companies argue that the individuals who generate earnings through the use of their technology are independent 

contractors. They claim only to operate a neutral technology—technological platform, enabling individuals to connect. Making that 

claim may enable gig economy companies to avoid legal liability for 

much of what happens as a result of the use of their platforms, 

may enable them—enables them to avoid Social Security contribuVerDate Mar 15 2010 11:59 May 17, 2016 Jkt 037690 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X80SHARINGECONOMYEDITSIFANY\114X80SHARINGECONO
4 

tions, and requirements to provide overtime pay, Workers’ Compensation, and Unemployment benefits. The workers are atomized, 

and unable to collectively bargain in their own interest. And this 

shift—many work related risks for employers go to workers. However, these entities are very often directly involved in almost every 

aspect of the transactions that occur by way of their technology. 

They maintain standards for users of their apps, and they have the 

ability to remove users from their platforms altogether, often without any mechanisms, by the way, to challenge their removal. 

In June the California Labor Commission found that Uber drivers are employees, rather than contractors. That determination, if 

upheld, would require Uber to provide reimbursable expenses, Social Security, Workers’ Compensation, and Unemployment Insurance benefits. Many gig economy businesses do not ensure that 

their employees met licensing, tax, and zoning requirements that 

are in place for the industries against which those businesses seek 

to compete. I believe those companies, and their employees and 

contractors, need to meet all existing requirements if they intend 

to compete with other entities honoring those standards. 

It is also important that liability questions are addressed by the 

businesses operating in the gig economy space. Is additional insurance coverage needed to protect employees or customers of gig 

economy businesses? When additional protection is required, how 

do gig economy businesses ensure that their employees and customers are adequately covered? 

These gig economy businesses are largely data driven, and there 

are few restrictions on how that data is used or protected. Highly 

sensitive information, including background checks, home addresses, credit cards, and bank account information and travel patterns 

are often collected by these businesses. Uber recently changed its 

privacy policy to allow the company to ask for location details when 

users aren’t actively engaging with the app. It also allows Uber access to a user’s contact list. Most Uber users probably have no idea 

about these policy changes, which is why greater oversight, transparency, and communication are needed in this emerging sector of 

the economy. All of these issues must be addressed if we are to ensure that the sharing economy is as much about improving the 

lives of working Americans as it is about increasing the market 

caps of gig economy companies. 

So I thank the witnesses for being here today. This is a truly important, seminal discussion that we have right now. I look forward 

to their testimony, and I yield back the balance of my time. 

[The prepared statement of Ms. Schakowsky follows:] 

PREPARED STATEMENT OF HON. JANICE D. SCHAKOWSKY

Thank you, Mr. Chairman, for holding today’s hearing on the sharing—or gig— 

economy. This is a topic deserving of our attention and scrutiny. 

Over the past few years, Americans have begun to interact in ways never imagined just a decade ago. The sharing economy is one of the byproducts of technological change. Today, people hail rides, book rooms, hire a contractor, and purchase 

groceries at the push of a button. This is the fastest growing sector in our economy. 

While there is undoubtedly a convenience factor for those who engage with the gig 

economy, there are a number of adverse consequences as well. 

For millennials, the gig economy model may be appealing for a time, providing 

scheduling flexibility that many young people desire. However, for many older workers who used to have full-time employment or younger workers seeking steady fullVerDate Mar 15 2010 11:59 May 17, 2016 Jkt 037690 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X80SHARINGECONOMYEDITSIFANY\114X80SHARINGECONO
5 

time work, this transformational change is not a positive. The model—which eliminates benefits like health care and pensions—means more questions about whether 

they can make ends meet, much less save for their children’s education, their parents’ elder care, or their own retirement. 

Gig economy companies argue that the individuals who generate earnings through 

the use of their technology are independent contractors. They claim only to operate 

a neutral technological platform, enabling individuals to connect. Making that claim 

may enable gig economy companies to avoid legal liability for much of what happens 

as a result of the use of their platforms, and enables them to avoid Social Security 

contributions and requirements to provide overtime pay, and workers’ compensation 

and unemployment benefits. This shifts many work-related risks from employers to 

workers. 

However, these entities are very often directly involved in almost every aspect of 

the transactions that occur by way of their technology. They maintain standards for 

users of their apps and they have the ability to remove users from their platforms 

altogether. 

In June, the California Labor Commission found that Uber drivers are employees 

rather than contractors. That determination—if upheld—would require Uber to provide reimbursable expenses, Social Security, workers’ compensation and unemployment insurance benefits. 

Many gig economy businesses do not ensure that their employees meet licensing, 

tax, and zoning requirements that are in place for the industries against which 

those businesses seek to compete. I believe those companies and their employees 

and contractors must meet all existing requirements if they intend to compete with 

other entities honoring those standards. 

It is also important that liability questions are addressed by the businesses operating in the gig economy space. Is additional insurance coverage needed to protect 

employees or customers of gig economy businesses? When additional protection is 

required, how do gig economy businesses ensure that their employees and customers 

are adequately covered? 

These gig economy businesses are largely data-driven, and there are few restrictions on how that data is used or protected. Highly sensitive information—including 

background checks, home addresses, credit card and bank account information, and 

travel patterns—is collected by these businesses. 

Uber recently changed its privacy policy to allow the company to ask for location 

details when users aren’t actively engaging with the app. It also allows Uber to access to a user’s contact list. Most Uber users probably have no idea about these policy changes, which is why greater oversight, transparency, and communication are 

needed in this emerging sector of the economy. 

All of these issues must be addressed if we are to ensure that the sharing economy is as much about improving the lives of working Americans as it is about increasing the market caps of gig economy companies. 

I thank our witnesses for being here today, and I look forward to their testimony. 

I yield back the balance of my time. 

Mr. BURGESS. The Chair thanks the gentlelady. The Chair recognizes the chair of the full committee, Mr. Upton, 5 minutes for an 

opening statement. 

OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN 

Mr. UPTON. Well, thank you, Mr. Chairman. You know, today we 

are here to discuss one of the most promising aspects of our recovering economy, the sharing economy. Significant innovation and advances have enabled new platforms to connect self-employed individuals or small businesses with the consumers who demand those 

goods and services. 

The sharing economy is growing in leaps and bounds. Believe it or not, in a decade, it is expected to generate $335 billion annually. 

That sort of growth cannot be ignored. So this series of hearings 

about disrupters, and I would include the Internet of things, and 

the vehicle to vehicle communications under that umbrella as well, 

is so important as we work to better understand how these innovaVerDate Mar 15 2010 11:59 May 17, 2016 Jkt 037690 PO 00000 Frm 00009 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X80SHARINGECONOMYEDITSIFANY\114X80SHARINGECONO
6 

tive companies impact consumers, job creation, and yes, our economy. I am always encouraged by the creativity and ingenuity that 

we see in America, and this hearing is a great forum to learn how 

real people are taking advantage of new opportunities to make a 

better life for themselves and their families. I know it is true in 

Michigan, as it is in the rest of the country, as families are glad 

to have new ways to make ends meet. 

One of the most intriguing aspects of this model is that it is not 

tied to any particular industry. The press regularly highlights the 

disruption in the lodging and transportation sectors, but there is 

innovation in every facet of the U.S. economy. And as with any developing marketplace, we must recognize the risk of stifling the innovation with reactionary regulatory measures. At a time when 

jobs are still hard to find, and balancing the budget is a challenge, 

we should not risk job creation with hasty calls to regulate. Where 

new technologies and competition are responding to consumer 

needs, and doing so safely, we should be asking ourselves if reducing the regulatory burden makes sense. This may be true for both 

the new entrepreneurs and incumbents. The sharing economy has 

also given folks across the country a chance to make decisions 

about how and when they work in a way that was not feasible even 

a few years ago. 

So we are familiar with high-profile leaders in the sharing economy, but there are many other platforms that are using technology 

to connect niche markets that have not been able to connect before, 

and I have seen that firsthand, and I am interested to hear more 

about those areas of the sharing economy. Our witnesses today represent a broad and diverse spectrum of the sharing economy. I 

would like to welcome in particular Michael Beckerman back to the 

committee, albeit on the other side of the dais this time around. I 

look forward to hearing all your stories and experiences with the 

sharing economy, and how we can foster an environment for community job growth and community development, and I yield back. 

[The prepared statement of Mr. Upton follows:] 

PREPARED STATEMENT OF HON. FRED UPTON

Today we are here to discuss one of the most promising aspects of our recovering 

economy: the sharing economy. Significant innovation and advances have enabled 

new platforms to connect self-employed individuals or small businesses with the 

consumers who demand their goods and services. 

The sharing economy is growing in leaps and bounds. In a decade, it is expected 

to generate $335 billion annually. That sort of growth cannot be ignored. 

This series of hearings about disrupters—and I would include the Internet of 

Things and vehicle-to-vehicle communications under that umbrella as well—is important as we work to better understand how these innovative companies impact 

consumers, job creation, and our economy. 

I am always encouraged by the creativity and ingenuity we see in America and 

this hearing is a great forum to learn how real people are taking advantage of new 

opportunities to make a better life for themselves and their families. I know that 

this is as true in Michigan as it is in the rest of the country, as families are glad 

to have new ways to make ends meet. 

One of the most intriguing aspects of this model is that it is not tied to any particular industry. The press regularly highlights the disruption in the lodging and 

transportation sectors but there is innovation in every facet of the U.S. economy. 

As with any developing marketplace, we must recognize the risk of stifling innovation with reactionary regulatory measures. At a time when jobs are still hard to 

find, and balancing the budget is a challenge, we should not risk job creation with 

hasty calls to regulate. Where new technologies and competition are responding to 

7 

consumer needs, and doing so safely, we should be asking ourselves if reducing the 

regulatory burden makes sense. This may be true for both the new entrepreneurs 

and incumbents. 

The sharing economy has also given folks across the country a chance to make 

decisions about how and when they work in a way that was not feasible even a few 

years ago. 

We are familiar with high-profile leaders in the sharing economy, but there are 

many other platforms that are using technology to connect niche markets that have 

not been able to connect before. I am interested to hear more about those areas of 

the sharing economy. Our witnesses today represent a broad and diverse spectrum 

of the sharing economy—and I’d like to welcome Michael Beckerman back to the 

committee, albeit on the other side of the dais this time around. I look forward to 

hearing all your stories and experiences with the sharing economy and how we can 

foster an environment for continued job growth and community development. 

Mr. BURGESS. The Chair thanks the gentleman. The gentleman 

yields back. We are expecting the ranking member of the full committee, Mr. Pallone, to be here at any moment. But pending that, 

let me just go ahead and introduce our witnesses, and then, when 

Mr. Pallone arrives, we will yield back to him for his opening statement. So we do want to thank all of our witnesses for being here 

today, thank our witnesses for taking time to testify before the subcommittee. 

Our witness panel for today’s hearing will include Ms. Luceele 

Smith, a driver-partner with Uber Technologies, Incorporated, Mr. 

Michael Beckerman, President and CEO of the Internet Association—and, you know, Michael, after you left the committee, so 

many people asked, ‘‘What happened to Michael?’’ And people said, 

‘‘He went to a better place,’’ so I guess the Internet Association is 

defined as a better place. Mr. Bob Passmore, Assistant Vice President for Personal Lines Policy with the Property and Casualty Insurance Association of America, Mr. Dean Baker, Co-Director of the 

Center for Economic and Policy Research, Mr. Alex Chriss, Vice 

President and General Manager at Intuit, and Jon Lieber, Chief 

Economist at Thumbtack. We do appreciate all of you being here 

today. 

We will go ahead and proceed with the witness testimony, and 

we may allow Mr. Pallone to give his opening statement when he 

arrives. So we appreciate all of you being here. We will begin with 

you, Ms. Smith. You are recognized. Each of you will have 5 minutes to provide a summary of your testimony and given an opening 

statement. Ms. Smith, you are recognized. 

STATEMENTS OF LUCEELE SMITH, DRIVER/PARTNER, UBER 

TECHNOLOGIES, INC.; MICHAEL BECKERMAN, PRESIDENT 

AND CHIEF EXECUTIVE OFFICER, INTERNET ASSOCIATION; 

ROBERT PASSMORE, ASSISTANT VICE PRESIDENT, PERSONAL LINES, PROPERTY CASUALTY INSURERS ASSOCIATION OF AMERICA; DEAN BAKER, CO–DIRECTOR, CENTER 

FOR ECONOMIC AND POLICY RESEARCH; ALEX CHRISS, VICE 

PRESIDENT, QUICKBOOKS SELF–EMPLOYED SEGMENT, INTUIT, INC.; AND JONATHAN LIEBER, CHIEF ECONOMIST, 

THUMBTACK, INC. 

STATEMENT OF LUCEELE SMITH 

Ms. SMITH. Good morning, Chairman Burgess, Ranking Member 

Schakowsky, and committee members. My name is Luceele Smith, 

8 

and I appreciate this opportunity to address you today and speak 

about my experience working with Uber. I began driving with Uber 

in June 2014, and prior to that I worked in the legal field, and 

served 8 years in the Air Force. My son is also in the Air Force, 

and will soon be deployed to the United Arab Emirates. 

Uber has been a great opportunity for me and many others. 

What I like most about Uber is the flexibility. It allows drivers to 

make money on their own time. I don’t have a boss to report to. 

I don’t have to be on call. I work when I want to, for as long as 

I want to, or as little as I want to. I use Uber as supplementary 

income to finance my travel. I am from the British Virgin Islands, 

and I use my extra income to visit my family. And when I want 

to travel, I don’t need to ask permission. I just go. 

Driving with Uber has also helped me to discover the city in new 

ways, which has been very rewarding. In fact, I have encouraged 

friends, and even riders, to become drivers because I think it is a 

great opportunity not only to see new parts of the city, but to connect with people in the community. And these are people that I 

would never otherwise have met. 

Every rider that I have met is grateful for the choice, and the 

convenience, that Uber has brought to their lives. I particularly 

enjoy the people component of being an Uber driver. Having traveled all over the world, I can strike up conversation with anyone, 

and point out new restaurants or new shows in town. And when 

it comes to my riders, I have had so many good experiences. I remember I picked up a couple once from the airport and took them 

to a Redskins game, and when we arrived, it started to rain, and 

the young lady was very concerned about her hair, so I gave her 

my umbrella. I understood what it would be like to sit in the rain 

and ruin your hair. So it was just a great opportunity to help people in large and small ways. 

I have worked in traditional jobs before, but there is nothing else 

out there where you can set your own schedule and your own goals. 

Sometimes drivers ask me, how much money do you make in a 

week? And the answer is, you can make as much as you want to. 

If I want to make $500 to fly to St. Thomas for Christmas, I can 

do that. With other jobs, the only way to earn more money is to 

take another job, or to get a promotion, and that can take years. 

So that freedom—it removes a lot of stress from your life, and that 

freedom is priceless, knowing you can log in anytime and make 

money. That is incredible. It is unmatched. So it is an opportunity 

that I enjoy, and I know many people feel the same way. Thank 

you so much. 

[The prepared statement of Ms. Smith follows:] 

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Mr. BURGESS. The Chair thanks the gentlelady. The Chair recognizes Mr. Beckerman. Five minutes for an opening statement, 

please. 

STATEMENT OF MICHAEL BECKERMAN 

Mr. BECKERMAN. Thank you. Chairman Burgess, Ranking Member Schakowsky, Chairman Upton, and Ranking Member Pallone, 

and members of the committee, thank you for inviting me to testify. My name is Michael Beckerman. I am the President and CEO 

of the Internet Association, which represents the world’s most innovative Internet companies. The Internet Association is the unified 

voice of the Internet economy and its global community of users. 

We are dedicated to advancing public policy solutions to strengthen 

and protect Internet freedom, to foster innovation and growth, and 

to empower the global community of Internet users. 

Included in our membership are more than 35 of the world’s 

most innovative companies, including the sharing economy platforms, such as Airbnb, FlipKey, Lyft, Sidecar, and Uber. And as an 

advocate for these companies on the local, State, Federal, and 

international level, the Internet Association has witnessed firsthand the often heavy handed and misguided regulatory approach 

in markets throughout the country for these platforms. These companies have an extraordinary story to tell, a story about job creation, about economic growth, opportunity, and life changing flexibility. 

Ride sharing and home sharing do get most of the attention, but 

these business models are really just the tip of the iceberg. Companies like Instacart, Washio, TaskRabbit, GetAround, Handy, and 

Thumbtack, who is here with us today, are changing the way we 

shop, do our laundry, rent cars, improve our homes, and so much 

more. The incredible consumer benefits of these platforms pales in 

comparison to the benefits of flexible earning opportunities for 

those that opt-in to meet consumer demand. 

What we are seeing across the country is a tale of two cities. In 

some communities, regulators embrace new technology and competition. In these communities, consumers in the local economy 

have seen job creation and growth. Unfortunately, there are other 

communities where policymakers and regulators have put up roadblocks that block consumer choice and competition. In these areas, 

the community is worse off when arbitrary barriers are placed on 

new entrants to the market. Competition is stamped out, growth is 

stifled, and opportunities are lost. 

In my testimony this morning, I would like to outline a few important principles the Internet Association thinks is helpful in this 

policy debate. But first I would like to help put the on demand, or 

sharing, economy into the proper macroeconomic context. Sidecar, 

or Uber, or Lyft, they are neither taxi companies nor transportation companies. They are technology platforms that connect supply and demand. Likewise, Airbnb is not a hotel or lodging company. It is a technology platform that connects supply and demand. 

To just give one example, back in 1980, let us say, if you wanted 

a ride to the airport, you might pick up the Yellow Pages and look 

up a number for a car service. Then you would pick up the phone, 

dial the number, talk to the dispatcher, and arrange for a ride. In 

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that pre-Internet age, the Yellow Pages served a similar function 

to what Uber or Lyft does today. It connects supply, the driver, 

with demand, the rider. But today, thanks to the Internet, and advances in mobile payments and other technology, this connection of 

supply and demand happens in real time, and in a seamless way 

for consumers, and the same is true for the other sharing platforms. 

Based on our advocacy for the Internet industry, and for the 

sharing economy specifically, the Internet Association suggests the 

following principles guide the committee as you wade into this debate. First, evidence demonstrating the clear benefits to consumers 

must be taken into account. These benefits include lower prices, 

higher quality of services, and overall increase in consumer choice. 

Second, in weighing these benefits against perceived harms, lawmakers should consider whether sharing economy services may, in 

fact, be safer than incumbent counterparts. Third, in listening to 

complaints against sharing economy companies in local markets, 

assess whether these complaints capture a genuine consumer protection concern, and are not merely complaints against increased 

competition that will benefit consumers. And finally, recognize the 

sharing economy platforms already self-regulate through various 

mechanisms that are hardwired into the technology, such as consumer ratings, payment systems, and GPS tracking, not to mention 

the intense competition between all of these platforms. And I do 

elaborate on each of these points in my written testimony, which 

I ask to be submitted for the record. 

In closing, the sharing economy is an exciting innovation that 

collapses the distance between those offering services and those 

consuming services. The end result of this arrangement is increasing quality, and lower costs. The sharing economy provides clear 

benefits to both consumers and those who wish to earn extra 

money, and evidence of this fact must be considered before taking 

legislative or regulatory action. Thank you for allowing me to testify, and I look forward to any questions the committee may have. 

[The prepared statement of Mr. Beckerman follows:] 

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Mr. BURGESS. The Chair thanks the gentleman. The Chair recognizes Mr. Passmore. Five minutes to summarize your testimony, 

sir. 

STATEMENT OF ROBERT PASSMORE 

Mr. PASSMORE. Let us turn on the button first. Good morning, 

Chairman Burgess, Ranking Member Schakowsky, and members of 

the committee. My name is Bob Passmore, Assistant Vice President 

for Personal Lines Policy at the Property Casualty Insurance Association of America, better known as PCI. On behalf of our nearly 

1,000 member companies, I thank you for your invitation at—to 

speak today—at today’s hearing. 

PCI members are at the heart of the sharing economy. While 

innovators in the sharing economy have designed new ways of 

using technology to improve business models, insurers have been 

innovating new ways of providing protection for centuries, and 

similarly will be the grease that will enable the sharing economy 

to reach its potential. The sharing economy is typically not new 

commercial activity, but rather is a new business model that allows 

individuals to use their personal time and resources to engage in 

commercial activity, with the potential to provide for more efficient 

use of resources for society, while essentially creating millions of 

single-person businesses. 

Where the sharing economy poses the biggest challenge, and the 

most controversy, is when they enter into a commercial activity 

that is highly regulated when conducted by a traditional business, 

such as a taxi company or a hotel. Essentially the same activity, 

but on a much smaller scale, but connected to a large sharing economy company. The policy question becomes what is the appropriate 

level of regulation, and does applying the same level of regulation 

render the sharing business model impractical or impossible? Insurers are certainly interested in the—understanding the answers 

to those larger policy questions, but of primary concern for insurers 

are critical insurance issues that are raised, as these business models blur the line between what has traditionally been thought of as 

a commercial or personal exposure. 

A prominent example of this dynamic has been evident in the 

emergence of ride sharing, or transportation network companies, or 

TNCs. TNCs had initially relied on their—the driver’s personal 

auto insurance policies for coverage, with the companies themselves providing some coverage that applied if the driver’s coverage 

was exhausted. However, most personal auto policies specifically 

exclude coverage when the vehicle is being driven for hire, leaving 

TNC drivers facing some significant gaps in coverage. And since almost every State has a motor vehicle financial responsibility law 

that requires vehicle owners to have—maintain some kind of auto 

insurance coverage, disputes in coverage litigation were inevitable. 

If these coverage disputes would result in court decisions imposing 

coverage for driving for a TNC on a personal policy that was neither intended for—neither intended or priced for, this potentially 

shifts the cost of this—of the risk associated with driving for hire 

onto the personal auto insurance system, requiring that all bear— 

drivers bear the cost of the activities of a relatively small number 

of TNC drivers. 

25 

The good news is that TNCs and insurers have been able to 

reach a consensus on a model law that supports the sharing economy business model, while providing appropriate protection—insurance protection, as well as disclosures that protect drivers, consumers, and insurers. The consensus model also allows for the development of different private sector business solutions for personal 

and commercial insurance coverages that can evolve over time, and 

has already been adopted in over half of the States. 

Over the last year it has become clear that, while there are significant insurance challenges presented by the sharing economy 

business models, solutions can be found by following a few principles. First, market-based approaches are preferred for both sharing business models and insurance, but in some cases State laws 

may need to be clarified to protect consumers in policy language 

certainty. Awareness of issues is essential. Many may not be aware 

if they have the right insurance when they enter into these activities. There needs to be proactive disclosures by the sharing business of what the insurance issues are, what coverage the sharing 

business is providing, and what additional coverage one may need 

to get prior to participation. 

Finally, State laws and regulations need to be flexible to allow 

for different insurance solutions. The sharing economy business 

model creates opportunities for both personal lines and commercial 

lines insurance products, and the excess and surplus lines insurance market is where many new businesses, such as the sharing 

economy business models, find their coverage, and those avenues 

need to be open to the sharing economy business models as well. 

PCI’s mission is to promote and protect a competitive insurance 

market for the benefit of consumers and insurers. Our members 

are committed to developing and providing new insurance products 

to support commercial and consumer innovation for the sharing 

economy. We appreciate that Congress has taken an interest in 

these issues, and look forward to continuing to work on sharing 

economy issues in the future. Once again, on behalf of our members, I thank you for inviting us to share our views, and I would 

be happy to answer any questions that you might have. 

[The prepared statement of Mr. Passmore follows:] 

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Mr. BURGESS. The Chair thanks the gentleman. The gentleman 

yields back. Mr. Baker, recognized for 5 minutes for summarizing 

your opening statement, please. 

STATEMENT OF DEAN BAKER 

Mr. BAKER. Thank you, Chairman Burgess, and Ranking Member Schakowsky. I appreciate the opportunity to address the committee. My name is Dean Baker. I am the Co-Director of the Center 

for Economic and Policy Research. I want to raise some general 

issues about the sharing economy. Certainly I would agree with 

comments that have been made that it offers great opportunities, 

basically, to take advantage of idle resources, as Ms. Smith had indicated her labor, her free time. Of course, with apartments, other 

sorts of idle resources to put them to greater use, that is the great 

opportunity, the great benefit of the sharing economy. The great 

risk is that it is—it—risk undermining a set of regulations at national, State, and local level that have often been put in place for 

very good purposes. And that is my real concern that I want to address here. And in doing so, I want to say I strongly disagree with 

Mr. Beckerman’s comment that this is simply the Internet version 

of the Yellow Pages. We have that. It is called craigslist. We aren’t 

talking about that. These are companies that have an active role 

in the operations that we are talking about here. 

So very quickly, I want to outline four areas that I talk about 

in my testimony, where regulations are being called into question. 

First, labor regulations. Secondly, consumer, both safety and quality regulations. Third, a question on property rights that has come 

up in a lot of different contexts. Fourth, anti-discrimination laws 

and regulations. And fifth, an important issue that the committee 

should be concerned about, issues of tax collection at all levels of 

Government. 

Starting with the issue of labor regulation, as Ranking Member 

Schakowsky raised in her opening testimony, we don’t know that 

sharing economy companies will provide the same sorts of protections that we expect—that Congress and State and local governments have given to traditional employees. So that means wage 

and hour laws, do minimum wage laws apply, Workers’ Comp laws. 

These are issues that should concern us. We don’t want to see sharing economy companies benefit simply because they are capable to 

undermine those laws. I should also point out that in many cases, 

perhaps most cases, this is not an insoluble task. For example, 

Uber could very easily use the information that is available to ensure that all its drivers are getting minimum wage laws, and they 

are paid in accordance with wage and hour standards. 

The second area, consumer safety regulation, we have extensive 

sets of regulations to ensure that, when you get into a cab, that the 

driver is a safe driver. I abuse my mother in this context. She is 

an 84-year-old woman who is a very decent person, and she has a 

Washington State Driver’s License. I really do not think she should 

be driving an Uber. This is the sort of issue that we should be concerned about. We ensure that people who drive cabs, drive commercially, have commercial driver’s licenses. We want to make sure 

that you have good drivers for Uber, or any other car driving service. Cars should be safe. Again, insurance issues. Insofar as those 

30 

are being settled, that is a big step forward, but I should point out 

that was not the original intention of Uber. They would—that was 

done under public pressure. In the case of—if we look at Airbnb, 

again, are they renting rooms that are safe? You know, do we know 

that they are—that they meet fire codes? This should be an important concern. Certainly we make sure that hotels—or at least we 

try to make sure that hotels are not fire traps. We would want to 

make sure the same is true of rooms rented through Airbnb. 

The third issue has to do with property rights. Many leases, 

many apartment leases, prohibit subletting. Many—in many cases, 

someone could sublet through Airbnb in violation of that lease. 

Again, does Airbnb bear responsibility? I would say we would want 

a situation where they do bear responsibility. Condo associations 

also often prohibit subleasing. Again, are people renting out rooms 

through Airbnb, or whole units, in violation of condo laws? And 

then, of course, it goes beyond that. Very often you have rent stabilization rules, you have zoning rules. These have all been called 

into question by Airbnb. I am not saying Airbnb is necessarily 

wrong in these circumstances, but we need clear regulation. 

The fourth issue, discrimination. Again, we have well developed 

sets of rules prohibiting discrimination based on race, gender. We 

don’t want discrimination against the handicapped—handicapped 

individuals. We want to make sure—case of—with Uber, we want 

to make sure we have handicapped accessible vehicles. Again, this 

is something that is a matter of legitimate public concern threatened by the sharing economy companies. 

The last point, we know in the case of traditional employers they 

are obligated to take out money for taxes for people, for their workers, and also, I should say, if you have someone renting out a unit, 

that can be done through Airbnb. This is a real concern. It is not 

a concern just for purposes of tax collection. We don’t want someone to come to April 15 and suddenly find they owe the IRS $5,000 

because nothing has been taken out of their paycheck. 

So these are very real concerns. So just to sum up, the whole 

point, to me, of the sharing economy is that it offers greater opportunities. We want to take advantage of the new technology. This 

should not be a way where firms are able to prosper simply by finding a more effective way to evade the law. Thank you. 

[The prepared statement of Mr. Baker follows:] 

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Mr. BURGESS. The gentleman yields back. The Chair thanks the 

gentleman. Mr. Chriss, you are recognized for 5 minutes for summarizing your opening statement, please. 

STATEMENT OF ALEX CHRISS 

Mr. CHRISS. Good morning, and thank you Chairman Burgess, 

Ranking Member Schakowsky, and members of the committee, for 

providing Intuit the opportunity to be here. My name is Alex 

Chriss from Intuit, and I am the Vice President for QuickBooks 

Self-Employed Business. I appreciate the opportunity to speak with 

you today about the sharing economy, and I am pleased to provide 

some insights we have gathered from close collaboration with our 

customers. I will also outline three recommendations Government 

could take to ease the burdens of sharing economy workers. 

As context, Intuit was founded over 30 years ago with one core 

mission that remains today, to improve people’s financial lives so 

profoundly they cannot imagine going back to the old way of doing 

things. We currently serve more than 45 million consumers and 

small businesses with our QuickBooks, TurboTax, and Mint offerings. 

In the past few years we have noticed an acceleration of a trend 

that began decades ago. We believe this trend to be a massive shift 

in employment towards a more independent, or self-employed 

workforce. Intuit recently conducted a study forecasting that selfemployed will grow to represent 43 percent of the workforce by 

2020. A very fast growing segment of this new workforce is the 

sharing economy. According to our data, 3.2 million Americans are 

earning income from the sharing economy. Within 5 years, our survey suggests the total population of sharing economy workers will 

more than double, to 7.6 million. 

What is not—what is often not fully appreciated is that the people who are self-employed and in the sharing economy are ultimately a small business of one in the eyes of the U.S. tax structure. They have a unique set of financial management needs. They 

often co-mingle business and personal expenses in a single bank account, making expense management and deduction tracking burdensome. They get paid a gross amount, often on a weekly basis, 

making visibility into their real income, or what is safe to spend, 

nearly impossible. And they are often unclear about their quarterly 

tax obligations, as this is most often a new and unfamiliar requirement. It is with these unique needs in mind that we created our 

QuickBooks Self-Employed offering. We strived to make the business aspect of being self-employed simple and pain free, while improving our users’ cash flow. 

I would like to outline three opportunities policymakers could 

being to take action on to improve the lives of this fast growing 

segment of the economy. The first is to clarify what constitutes a 

record for Schedule C tax compliance. Sharing economy workers 

find customers and income at the touch of a button on a mobile device. If they are required to keep paper records to verify their 

Schedule C deductions, this requirement raises questions about the 

regulatory definition of what a record entails. Flexibility with respect to the term record would benefit the growth of this worker 

44 

segment. The less time people spend managing paperwork, the 

more time they have to earn a living. 

The second is to enable sharing platforms to give guidance without triggering worker classification issues. Sharing economy platforms can play a role in helping this segment of the workforce meet 

and understand their obligations. Many sharing platforms limit the 

advice they provide to workers for fear of triggering employment 

regulations that would characterize this workforce as employees. 

Providing this information would be beneficial to the sharing platforms, the workers, and the IRS. This creates an opportunity for 

Government agencies that oversee classification guidelines. Clarity 

around the type of communication companies can share with selfemployed workers will enable them to access helpful information 

regarding financial literacy, tax obligations, and savings. 

Finally, the third recommendation is to update Government programs to support the self-employed. A great example is the Department of Treasury. They initially released its MyRA retirement savings product to employees to access exclusively through employers. 

They are now planning to allow individuals to open accounts, but 

they were not initially being considered, and had to wait for benefits to be opened up to them. Creating a shift in mindset where 

self-employed are considered part of the workforce is something 

Government agencies should prioritize. 

We encourage the committee to explore ways to adapt our current structure to meet the needs of the sharing economy workers 

so that the grown and success of this segment continues. Once 

again, Chairman Burgess, Ranking Member Schakowsky, and 

members of the committee, thank you for giving Intuit the opportunity to share insights from our sharing economy customers, and 

I look forward to answering any questions you may have. 

[The prepared statement of Mr. Chriss follows:] 

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Mr. BURGESS. The gentleman yields back. The Chair thanks the 

gentleman. Mr. Lieber, you are recognized for 5 minutes for an 

opening statement, please. 

STATEMENT OF JONATHAN LIEBER 

Mr. LIEBER. Good morning, and thank you for the opportunity to 

testify today. My name is Jon Lieber, and I am testifying on behalf 

of Thumbtack. We are a San Francisco based technology company 

that matches consumer with—consumers with service professionals 

to help them accomplish projects that are central to their lives. We 

are honored to be part of this discussion here today on behalf of 

our growing technology companies and the small businesses we 

serve. 

Thumbtack’s network of more than 150,000 active professionals 

help customers get started with more than 5 million projects each 

year. We are proud to say that we will be putting more than a billion dollars into the pockets of these professionals this year, and 

multiples of that in years to come. Our professionals are active 

across all 50 States, and here in the District of Columbia, and they 

offer services across more than 1,000 categories, from dog walking 

to bathroom remodeling. About half the service professionals on 

Thumbtack have been in business for themselves for 5 or more 

years, and similar numbers report that they have one or more employees. Two-thirds say that the businesses they run on Thumbtack 

is their primary form of income. 

Our most active categories are events, such as DJs, photography, 

and catering, home improvement, including lawn care, house cleaning, plumbing, and electricians, and we also offer wellness services, 

like personal training, and a variety of lessons, from Spanish to 

horseback riding. And though we are headquartered in San Francisco, it is only our 11th biggest market. We operate only in the 

United States for now. 

Although the hearing today is officially about the sharing economy, this name is frequently misapplied to a variety of new business technologies that are connecting people together. Thumbtack 

does not consider ourselves to be part of the sharing economy. We 

like to say we are part of the real economy. Technology is enabling 

the businesses who use Thumbtack to work—find work faster and 

cheaper than they ever could before. And not to pile on the Yellow 

Pages here, but while a previous generation was limited to placing 

an ad in the Yellow Pages and waiting for the phone to ring, 

Thumbtack directly connects these small businesses to customers 

who are looking for their services. 

The ease of introducing small service businesses to new clients 

is solving one of the biggest problems that these businesses have. 

And along with back office support tools, like those offered by Intuit, is lowering the cost of starting and growing a successful small 

business. We believe that we are empowering these professionals to 

realize their dreams of working for themselves, and the stories that 

we hear from our pros about what Thumbtack has enabled them 

to do are inspiring and powerful. 

In my written testimony I discuss some of the effects that technological disintermediation is having on both consumers and the 

professionals who serve them, and I would like to mention two of 

56 

them now. First is that although disruptive technology companies 

are bringing attention to issues of worker classification and workplace benefits, for small businesses, like the ones that use Thumbtack, to grown, these issues aren’t new. 

Because Congress has passed responsibility for certain elements 

of the social safety net onto employers through a combination of 

mandates, tax incentives, and payroll taxes, we have created a twotier benefit system in this country, one for individuals who generally work full time at larger companies, and one for everyone 

else. The decision to go work for one’s self has long meant giving 

up the comforts of traditional employment, including paid time off, 

and a variety of tax-preferred health and retirement benefits. And 

although Congress has attempted to extend some of these benefits 

outside the workplace through the Affordable Care Act and tax-free 

savings vehicles, like IRAs, there is more that could be done. To 

the extent possible, benefits should be tied to the worker, and not 

their place of work, or their form of compensation. 

Small businesses are also intimately familiar with issues surrounding worker classification. Although many of the businesses 

we speak with would love to bring on full time workers to help 

them expand, the cost, not just in wages, but in compliance and 

benefits, are often prohibitively high. The decision to bring on a full 

time worker can frequently mean with—dealing with unexpected 

and expensive mandates, such as California’s recent decision to require that all employers, regardless of size, provide paid sick leave. 

Often it is far easier to rely on independent contractors, who generally don’t qualify for these benefits. 

The second issue I would like to emphasize for the committee is 

the need for better measurement tools. Although all signs point to 

the rapid adoption of technology that will connect people together, 

and allow an increasing number of people to work outside of the 

traditional employment system over the coming decades, we don’t 

have a great count of how many people are actually engaged in this 

kind of work. The Bureau of Labor Statistics hasn’t had dedicated 

funds to study this segment of the workforce, which they call contingent workers, since 2005. Private researchers and corporations 

are attempting to fill the gaps, but the Government should be 

doing more to keep up with the pace of change in the labor market 

by more accurately tallying and releasing data on the number of 

self-employed and independent contractors on a more regular basis. 

Thank you again for the opportunity to testify, and I look forward to taking your questions. 

[The prepared statement of Mr. Lieber follows:] 

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Mr. BURGESS. The Chair thanks the gentleman. The gentleman 

yields back. The Chair would ask unanimous consent that Mr. 

Pallone be allowed to give his opening statement out of order before we proceed to questions. Mr. Pallone, you are recognized for 

5 minutes. 

OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW JERSEY 

Mr. PALLONE. Thank you, Mr. Chairman. Today this subcommittee has the opportunity to discuss one of the fastest growing 

sectors of the U.S. economy, and that is the sharing economy, 

which is just not millennials hailing rides and renting spare rooms 

from their phones. In communities across the country, Americans 

are using their computers and smartphones to order a meal, find 

a gardener, sell homemade crafts, and even request a dog sitter. 

Just like Google and Facebook before them, businesses like Uber, 

Lyft, and Airbnb are rapidly evolving from names into verbs. One 

recent study predicts that the five biggest sectors of the sharing 

economy generated $15 billion in revenues last year, and could exceed $330 billion in a decade. In my home State of New Jersey, 

Uber has already signed up 9,000 drivers. These businesses can 

offer benefits for both buyers and sellers. Some platforms provide 

temporary access to goods and services that buyers might not be 

able to otherwise afford. Consumers enjoy the convenience of being 

able to summon a ride, request a dry cleaning pickup, or order groceries from a device in their pocket. And sellers can benefit from 

a new source of income, sometimes just by renting items sitting unused in their basements or garages. 

But the growth of the sharing economy has also raised a number 

of difficult issues. Many services track their users’ location, potentially putting privacy and safety at risk. To verify users’ identity 

some apps store credit card information, home and work addresses, 

and other personal information. Consumers often have no way of 

knowing if their information is protected from a data breach, or if 

it will be sold to or shared with an unknown third party. In addition, may apps allow both buyers and sellers to view ratings and 

reviews of past transactions. These reviews can push bad actors out 

of the market by making sure users are trustworthy and legitimate, but it can also be difficult to tell if these reviews are accurate, and it is unclear whether reviews and rankings alone can protect users’ safety. 

As more Americans seek to provide services in the sharing economy, the question of whether they are employees or independent 

contractors remains unresolved. Other than that logo on the door, 

there is little obvious difference between Uber drivers and cab drivers, but for the workers a lot is riding on the distinctions. Unemployment benefits and overtime pay are just a couple of the workplace protections at stake. State and local governments across the 

country are also grappling with the regulatory challenges posed by 

the growth of the sharing economy, including whether companies 

are responsible for paying local taxes, providing insurance, or conducting background checks. 

72 

The sharing economy is about transforming innovative ideas into 

services we depend on, but that innovation must be coupled with 

basic protections for all participants, including worker protections, 

privacy, data security, and safety, and I am confident that we can 

find a balance that protects consumers while preserving innovation, 

and ensuring a level playing field for businesses. And I think the— 

I, again, thank the chairman for holding this hearing, and giving 

me the opportunity to make my statement. Thank you. 

[The prepared statement of Mr. Pallone follows:] 

PREPARED STATEMENT OF HON. FRANK PALLONE, JR. 

Today this subcommittee has the opportunity to discuss one of the fastest-growing 

sectors of the U.S. economy. The ‘‘sharing economy’’ is not just millennials hailing 

rides and renting spare rooms from their phones. In communities across the country, Americans are using their computers and smartphones to order a meal, find a 

gardener, sell homemade crafts, and even request a dog-sitter. 

Just like Google and Facebook before them, businesses like Uber, Lyft, and 

Airbnb are rapidly evolving from names into verbs. One recent study predicts that 

the five biggest sectors of the sharing economy generated $15 billion in revenues 

last year and could exceed $330 billion in a decade. In my home State of New Jersey, Uber has already signed up 9,000 drivers. 

These businesses can offer benefits for both buyers and sellers. Some platforms 

provide temporary access to goods and services that buyers might not be able to otherwise afford. Consumers enjoy the convenience of being able to summon a ride, request a dry-cleaning pickup, or order groceries from a device in their pocket. Sellers 

can benefit from a new source of income, sometimes just by renting items sitting 

unused in their basements or garages. 

But the growth of the sharing economy has also raised a number of difficult 

issues. Many services track their users’ location, potentially putting privacy and 

safety at risk. To verify users’ identities, some apps store credit card information, 

home and work addresses, and other personal information. Consumers often have 

no way of knowing if their information is protected from a data breach or if it will 

be sold to, or shared with, an unknown third party. 

In addition, many apps allow both buyers and sellers to view ratings and reviews 

of past transactions. These reviews can push bad actors out of the market by making sure users are trustworthy and legitimate. But it can be difficult to tell if these 

reviews are accurate, and it is unclear whether reviews and rankings alone can protect user safety. 

As more Americans seek to provide services in the sharing economy, the question 

of whether they are employees or independent contractors remains unresolved. 

Other than the logo on the door, there is little obvious difference between Uber drivers and cab drivers. But for the workers, a lot is riding on the distinctions. Unemployment benefits and overtime pay are just a couple of the workplace protections 

at stake. 

State and local governments across the country are also grappling with the regulatory challenges posed by the growth of the sharing economy, including whether 

companies are responsible for paying local taxes, providing insurance, or conducting 

background checks. 

The sharing economy is about transforming innovative ideas into services we depend on. But that innovation must be coupled with basic protections for all participants, including worker protections, privacy, data security, and safety. I am confident that we can find a balance that protects consumers while preserving innovation and ensuring a level playing field for businesses. I thank the chairman for holding this hearing and look forward to hearing from our witnesses. 

Mr. BURGESS. The Chair thanks the gentleman, and the Chair 

would like to remind members that, pursuant to committee rules, 

all members’ opening statements will be made part of the record. 

We conclude, then, our witness testimony, and we thank you for 

your presence and your testimony today. We will move to the questions part of the hearing. And I will recognize myself for 5 minutes 

for the purposes of questions. 

73 

Mr. Chriss, let me ask you, because the study that we both reference, that estimated that almost 8 million people will be participating in a sharing economy very soon, begs the question, why are 

so many people showing up to participate in the sharing economy? 

Mr. CHRISS. Thank you. I think one of the things that we have 

seen, as people are coming in, and—we actually refer to this as the 

on demand economy. On demand refers to not only the ability to 

push a button, as a consumer, and get a ride, or have someone deliver food to you, but also the idea that workers are able to come 

in, and push a button, and get a job. I think that is where we are 

seeing more and more people coming in, when they have the ability 

to—before, just—literally at the push of a button, find income. 

This is changing behavior—just as we see from consumers, this 

is changing behavior of workers. Right now we are seeing 79 percent—in our research, 79 percent of the workers in on demand are 

working part time. Many of them are coming from traditional jobs, 

and adding this to create incremental income as well. And as they 

test their way in, I think we will see that they continue to evolve. 

Many of these workers right now, again, with our research, are less 

than 1 year working in on demand. So while this is wonderful we 

are having this conversation, it is so early in the game right now. 

It will be interesting to see how it evolves. 

Mr. BURGESS. Ms. Smith, let me ask you kind of the same question. I mean, how did you arrive at the decision that this was something that you wanted to do? 

Ms. SMITH. It—it is a great opportunity to make money by one’s 

choice. So—I have worked in traditional jobs before. This opportunity to log in and earn money on any schedule that I chose, for 

any goal that I had, is just incredible. So that was very attractive 

to me. 

Mr. BURGESS. Mr. Lieber, we will probably disagree about the 

amount of money available to the Bureau of Labor Statistics, but 

one of the things they do is provide to Congress, the first Friday 

of every month, to the Joint Economic Committee—I am no longer 

on that committee, but I was, so—during the harshest part of the 

recession it was part of my job to hear their report on the first Friday of every month. 

And we all talk about the unemployment rate, and the U–6 numbers, and what the employment rate really is, but it seemed to me, 

studying for this hearing and understanding better the sharing 

economy that—I mean, this is a way for some of those people who 

have been chronically unemployed now, may have left, may even 

have dropped out of the labor workforce participation. But, again, 

you can punch an app and earn some money, that is a pretty powerful notion, isn’t it? 

Mr. LIEBER. Absolutely. And what we find of users of—business 

users of Thumbtack is many of them are leaving a corporate job, 

and they are kind of putting their finger in the wind to test out 

if they can actually cut it as a full time caterer, or a photographer. 

And by lowering the cost of getting these people into their own 

business, and by delivering consumers to them, we think that we 

are creating this opportunity that didn’t exist in years past, and 

making it easier than ever for them to start and go work for themselves. 

74 

Mr. BURGESS. And it is certainly not part of this hearing, but 

having spent time on the Joint Economic Committee, and hearing 

those figures from the Bureau of Labor Statistics, and the people 

who were discouraged from ever finding or looking for traditional 

employment again, I mean, this seems to be a way back into the 

workforce that, really, probably wasn’t even available, or only 

available on a limited basis, as the years of the Great Recession 

began to unfold. Would you agree that this is a fifth pathway, if 

you would, back into employment? 

Mr. LIEBER. Absolutely. I think this represents a tremendous opportunity for people. And what is—what is exciting to me is that, 

for people who have a skill—say you are a locksmith, and you are 

good at locks, but you, you know, haven’t had a chance to build out 

your customer base yet, this is the opportunity for you to go online, 

find customers, and get your business started quickly, easily, and 

start getting customers pushed to you. 

And we have heard a lot of stories like that, of people who have 

been down on their luck, people who just left the military, people 

who lost their jobs, or people who are looking for what next to do 

in their lives. And they are able to come to these platforms, come 

online, and start finding new work. 

Mr. BURGESS. Well, I kind of believe we are just beginning to 

scratch the surface. Mr. Beckerman, let me just ask you, because 

I remember my predecessor in this office, who at the time was Majority Leader, in the late 1990s described to the Dallas Chamber 

a situation with—this thing was new, it was e-commerce. He said 

Congress doesn’t understand it, they are very likely to try to regulate it and tax it, and when they do that, they will kill it. Do you 

think he was correct in that assessment? 

Mr. BECKERMAN. I think this is a new area providing incredible 

opportunity, and Congress need to be a little careful not to put too 

heavy of a hand on this and regulate it too much. Because, as we 

are hearing from a number of the witnesses, it is providing opportunities for them that didn’t exist before, and it is a great opportunity for our economy, for people to get back to work, and earn 

extra money for their families. 

Mr. BURGESS. Very good. Thank you, and my time has expired. 

I will recognize the ranking member of the subcommittee, Ms. 

Schakowsky. Five minutes for questions, please. 

Ms. SCHAKOWSKY. Thank you. Mr. Baker, I want to ask some 

questions, but first I want to read a piece of testimony that I would 

like to put in the record for—from Indir Pamar, who says he has 

a been a professional driver in New York City for 15 years. He 

says, I began working for Uber because I thought I could earn more 

money than I had working for other black car companies. Uber’s 

rates sounded like a good deal. When I first started working with 

Uber X, the minimum fare would be $12. Uber would take 10 percent of each fare, and the rest would be mine to keep. 

Within just months, though, Uber changed its payment rates, 

and while the price of gas and my car payment stayed the same, 

the 10 percent commission I paid to Uber became 20 percent, and 

the $12 minimum fare dropped to $8. And then he also says, the— 

Uber’s business model is flood the streets with cars, regardless of 

how much work is available for them. In New York City, Uber 

75 

added 20,000 new cars to have us compete with 13,600 taxis, and 

another 40,000 black cars, and car service liveries that were already on the streets. It says that Uber doesn’t care—if there are 

100,000 trips a day, those trips could be split between 10,000 drivers or 30,000 drivers. 

And he—finally he says, Uber says they are not my employer— 

to the point that you made—even though they direct my every 

move, and control my income, and can punish me. With Uber we 

have no voice. I don’t get to set the rates. Uber takes away my fare 

income if a passenger has a dispute with them over the fare they 

set. And if a passenger complains that I took a long route, Uber 

takes the money back without giving me a chance to explain myself. Friends of mine have been suspended because their passenger 

rating was too low, even though they had been accused of doing 

nothing wrong. What was too low? Less than 4.5 out of 5 stars, a 

B+. 

So I just wanted to talk to—here is somebody who though he was 

going to make more money, have more control, and finds that, really, Uber, that says they are just a Web site, or just a technological 

platform, is controlling their life. 

Mr. BAKER. Yes, well, I think this is very problematic, and exactly the sort of situation that I think we have to be concerned 

about. So just to be clear, you know, being able to order a cab over 

the Internet, wonderful thing. You could be on a smartphone, that 

is a great thing. But, on the other hand, these people, for practical 

purposes, are employees while they are on the job. 

And, again, we aren’t asking a lot if we are to tell Uber that, you 

know, you have to make sure that your drivers make at least the 

minimum wage. They have the technology to do that. If they are 

competent enough, then they should be replaced by a company that 

is. I mean, that is a very, very simple thing. So extending employee-type relationships, employee-type rights, for example, collective bargaining—again, people may not like it, but that is the law. 

It doesn’t make sense that you have collective bargaining over 

here, but we are going to call ourselves Uber, and now you don’t 

have collective bargaining. So these are issues that I think are very 

much a proper concern of Congress, and of State and local governments as well. 

Ms. SCHAKOWSKY. Let me just ask you this. So many sharing 

economy firms have said that they are just an app. They describe 

themselves not as employers, but rather as technology platforms. 

So how would you compare the type of work being done by workers 

who have traditionally been deemed independent contractors, such 

as electricians, Realtors, or consultants, with those in the sharing 

economy? 

Mr. BAKER. Well, traditional contractors, they control their time, 

they control their wage rate, they control what they do. I sometimes write a paper, sometimes I will be paid on commission. Well, 

if someone contacts me, they say, ‘‘We need this in two weeks,’’ I 

am going to decide what it looks like, I will decide the content. 

That is really not the case with Uber. They specify the rules. 

In a lot of ways, that is a good thing. We want to make sure that, 

when you drive an Uber, the car’s safe, other conditions are met, 

but that is not the situation of an independent contractor. 

76 

Mr. BURGESS. Let me—Mr. Lieber, in your testimony you seem 

to suggest that most sharing companies fall into one of two buckets, that those that have a mostly hands-off approach, perhaps 

such as Etsy, and eBay, and others that impose certain requirements on the independent contractor, such as Uber. Can you further explain those two types? 

Mr. LIEBER. Yes. The distinction there is—we think of there of 

being—as kind of a marketplace company, which is kind of matching buyers and sellers in a marketplace, giving them information 

to make informed decisions on their own, and a dispatch company, 

which is directly pushing a service provider to you. You know, you 

ask for your groceries delivered, and the groceries then come to 

you. And I think these are kind of two separate types of technologies that are out there today. 

Ms. SCHAKOWSKY. OK. And so, Dr. Baker, do you agree that 

there are two types of sharing companies, and would the need for 

more or less regulation depend on which of those buckets a company falls into? 

Mr. BAKER. I think that is exactly right. Inevitably there will be 

some gray areas, but I think Uber’s a very clear side of the gray 

area. This is an employee-type relationship. 

Ms. SCHAKOWSKY. Thank you. I yield back. 

Mr. BURGESS. The gentlelady yields back. The Chair thanks the 

gentlelady. The Chair recognizes the gentleman from Texas, Mr. 

Olson. Five minutes for your questions, please. 

Mr. OLSON. I thank the Chair, and welcome to our witnesses. I 

am excited about the sharing economy, all this new technology, 

new innovation. But with regards to these changes, I asked myself, 

how does this impact the market? Is it good, is it bad, and most 

importantly, is it safe? 

My first question is for Mrs. Smith, Mr. Passmore, and Mr. 

Beckerman. Unfortunately, we don’t hear a lot about the good actors. We hear about the bad actors, stories from back home. For example, people who use the sharing economy to do harm. Back home 

in Houston, Texas, a driver in the shared economy assaulted an intoxicated woman. The background check missed him because he 

had been in jail for most of that time. My question is, who should 

be liable for protecting our consumers from bad actors in the 

shared economy? Mrs. Smith, your thoughts, ma’am? 

Ms. SMITH. I believe that is an Uber policy question that I am 

not comfortable answering. 

Mr. OLSON. Thank you, ma’am. Mr. Beckerman? 

Mr. BECKERMAN. Thank you. I would add, I think there are a 

number of safety precautions that are hardwired into the technology that provides accountability that didn’t exist prior, and that 

does not exist on taxi cabs. And no industry is 100 percent safe, 

or 100 percent perfect. 

Mr. OLSON. You bet. 

Mr. BECKERMAN. Certainly hotels are not, and taxi cabs are not. 

But the two-way rating system, having GPS tracking, and the 

background checks that all the sharing economy platforms do on 

the ride sharing side are very comprehensive, and they seek to 

have transparency, accountability, and trust for their users. And I 

think that goes a long way. 

77 

Mr. OLSON. Mr. Passmore, your thoughts, sir? 

Mr. PASSMORE. PCI represents auto home and business insurers, 

so I think the question gets a little bit beyond the scope of what 

I am prepared to answer for. But, you know, what we have tried 

to do is clarify the auto insurance issues to make sure that, if you 

get involved in an accident, there is a clear line of where the injured parties can go to collect for their damaged vehicles, and injuries, and things like that. 

Mr. OLSON. And my final question is for the entire panel. Start 

with you, Mr. Lieber. Sadly, my home of Houston, Texas, is ground 

zero for human trafficking in America. Interstate 10, according to 

our FBI, right through Houston, Texas, is the number one highway 

for human trafficking to come through. Girls, mostly, being sold 

into slavery right through my hometown. 

I have held several roundtables back home with law enforcement 

officials, local mayors, all these people involved in this. It is a real 

big problem. But I am concerned that the bad guys can use the 

shared economy to promote human trafficking. So my questions is, 

what can this shared economy do to stop human trafficking? Mr. 

Lieber, your thoughts? 

Mr. LIEBER. Just speaking from Thumbtack’s perspective, there 

is—I mean, we don’t offer any kind of services that would be appropriate to be abused in that fashion. Trust and safety is the number 

one important factor for Thumbtack, getting you a trusted professional to do a great job for you, and marketplace integrity is something we take very seriously. 

Mr. OLSON. Mr. Chriss, your thoughts, sir? 

Mr. CHRISS. Providing financial management software through 

Intuit, I think this would be beyond my expertise to answer. 

Mr. OLSON. OK. Mr. Baker? 

Mr. BAKER. I don’t know of things sharing economy companies 

can specifically do, but the one thing I would say is that, insofar 

as Congress puts—or State Governments, for that matter, put in 

regulations in place to try to crack down on human traffic, again, 

the point is it has got to apply to sharing economy companies as 

well. So if you have regulations that make it more difficult for, say, 

a traditional cab company to be involved in this in some way, certainly you want that to be applied to your ride sharing services 

also. 

Mr. OLSON. Thank you. Mr. Passmore? Any thoughts about 

human trafficking, how—I mean, I know you are not quite directly 

involved, but any thoughts how—— 

Mr. PASSMORE. Right. 

Mr. OLSON [continuing]. You can influence this, make sure we 

separate the bad guys from the people who are getting abused by 

these—— 

Mr. PASSMORE. Again, it is a little outside of our realm of expertise, but I would say that, you know, if you are applying—no, I 

think—I don’t really think I am qualified to answer that question. 

Mr. OLSON. Mr. Beckerman? 

Mr. BECKERMAN. Safety and security is first and foremost for all 

of our member companies, and, you know, those kinds of activities 

I think are outside of the scope of the services that our companies 

offer. But I think technology certainly can help, and when you look 

78 

at all of these platforms, the community that they create, and the 

trust they create, I think could be helpful in stopping some of this. 

Mr. OLSON. And, finally, Ms. Smith? 

Ms. SMITH. As a driver, I have never encountered anything remotely connected to human trafficking, and so I don’t feel informed 

enough to give a detailed response on that. 

Mr. OLSON. Well, thank you. Thank you for your service, and we 

can agree, go Air Force, go Navy, beat Army. I yield back. 

Mr. BURGESS. The Chair thanks the gentleman. The Chair recognizes the gentleman from New Jersey, Mr. Pallone, the ranking 

member of the full committee. Five minutes for your questions, 

please. 

Mr. PALLONE. Thank you, Mr. Chairman. In May of this year, 

Uber updated its privacy policy to allow the company to track 

users’ location whenever its application is open, even if consumers 

are not actively using the application. In other words, if I take a 

ride on a Monday, Uber still can be tracking my location the following Thursday. And, of course, Uber is not the only sharing economy firm to track its users. The constant collection of that data 

does raise privacy concerns. So I wanted to initially ask Mr. Baker, 

it is my understanding that most consumers do not understand the 

extent to which mobile applications, such as those created by sharing economy firms, can access and store data about consumers’ locations. Do you agree with that statement? 

Mr. BAKER. I would be inclined to agree, but I have to say, that 

is really not based on any data. It is just simply anecdotal. I mean, 

I do know people, obviously, who will use Uber. I will confess I 

have never used it myself, but, you know, I do know many people, 

and they have no idea of what data they collect and what they do 

with it. And I think it is certainly a proper concern of Congress 

that there be, at the very least, clear disclosure, if not actual regulation, on what they can do with it, but certainly disclosure of what 

their practices are. 

Mr. PALLONE. Well, from a—I mean, expressing the privacy concerns that I share, but do you see any—well, I mean, what about 

this idea of storing location data permanently, rather than discarding it after the transaction is completed? Is there some way— 

I mean, obviously, from a privacy concern, you would rather see it 

discarded after the transaction is completed. What would be your 

view on that? 

Mr. BAKER. Well, I think it would be totally appropriate to say 

that, you know, to prohibit those companies from keeping that 

data, because it is—well, on the face of it, you are contracting with 

them for a ride, and that seems to me that should be the end of 

the relationship, unless people consciously decide they want a further relationship with the company. But, again, I think most people 

are understanding, when they are taking an Uber, they are contracting for a ride, not to give away details of their lift to third parties. 

Mr. PALLONE. OK. Now, should sharing economy firms be more 

up front about when, how, and why they are tracking user locations, in your opinion? 

79 

Mr. BAKER. I think absolutely. Again, I think, two separate 

issues here. One, do you restrict what they can do? Open question, 

you know, I couldn’t give you a well-reasoned—— 

Mr. PALLONE. OK. 

Mr. BAKER [continuing]. Answer on that, but that is one issue. 

Second one, disclosure of what they are doing, and, to my mind, 

that has to be a clear responsibility, that there have to be clear 

roles so that everyone at least can know. I mean, some people may 

not care, and that is fine, but a lot of people may want to know 

that if they are taking an Uber, this information is being kept and 

quite possibly shared with a third party. 

Mr. PALLONE. All right. Now, some apps, including Uber, give 

companies access to other personal information, including users’ 

contacts and address book. It is my understanding that most consumers do not understand the extent to which mobile applications, 

such as those created by sharing economy firms, can access and 

store data from consumers’ contacts and address books. Do you 

agree, and you want to talk about the privacy concerns with that? 

Mr. BAKER. Well, that is, to my view, you know, I have heard accounts of that. I assume that they are true. But, to my view, that 

is absolutely amazing. I mean, again, you are contracting with 

Uber to get from point A to point B. You aren’t—at least I think 

almost no one is knowingly contracting with them to give them access to their address book. So it is very hard to see why they would 

have a legitimate reason to get access to that sort of information. 

Mr. PALLONE. Well, let me go to Ms. Smith. In order to use Uber, 

a person must download the Uber app, giving permission for Uber 

to collect that person’s address book. Can you explain how that information is used by Uber? 

Ms. SMITH. I am not sure how it is used by Uber, but when an 

individual does download the app, they are given an opportunity to 

agree to what Uber may do. And, as far as the location, I believe 

that the information may always be collected only when the app is 

being used, or never. And so an individual does have an opportunity to decline, if they are not comfortable. And whenever you do 

download the app, there is an agreement that you must agree to 

in order to use the app. So everyone who uses the app agrees to 

the conditions that are in the agreement. 

Mr. PALLONE. Well, let me ask Mr. Beckerman to comment on 

that, and also, since there are only a few minutes—seconds left. We 

all know the critique, Mr. Beckerman, that privacy policies are too 

long and full of legalese, especially on a mobile device. But how are 

your members taking steps to make sure consumers are aware of 

the extent to which their information is collected, and sometimes 

is shared or sold? Or if you want to also comment on what Ms. 

Smith said? 

Mr. BECKERMAN. Yes. Thank you for the question. First, on the 

tracking, if you look at the settings in your phone, it does indicate 

that the tracking only happens when the app is open, and you are 

using it. And the ability to look at the map and see where you are 

going is part of, actually, the safety and security features of the 

phone. You know, my wife left her purse in an Uber once, and we 

were able to retrieve it immediately because of some of these feaVerDate Mar 15 2010 11:59 May 17, 2016 Jkt 037690 PO 00000 Frm 00083 Fmt 6633 Sfmt 6633 F:\114THCONGRESS\114X80SHARINGECONOMYEDITSIFANY\114X80SHARINGECONO
80 

tures. And had she left it in a cab, we probably never would have 

seen it again. 

When it comes to data security and privacy, there are laws on 

the books from Congress and the FTC that apply to all companies, 

sharing economy companies, Internet companies, brick and mortar 

companies, and I don’t believe there are any gaps in the coverage 

of protections that we have. 

Mr. PALLONE. All right, thank you. Thank you, Mr. Chairman. 

Mr. BURGESS. The gentleman yields back. The Chair thanks the 

gentleman. The Chair recognizes the gentleman from Illinois, Mr. 

Kinzinger. Five minutes for questions, please. 

Mr. KINZINGER. Well, thank you, Mr. Chairman, and thank you 

all for being here. It is helpful to us, appreciate it. Chairman, 

thank you for holding the hearing of—that is the first of what I expect will be a great series of hearings. I think there is a lot to be 

excited about in the sharing economy, and I appreciate the committee’s consideration of the economic benefits, new choices for consumers, and the underlying policy impacts that have come to light. 

Last week Business Insider ran an article on the sharing economy that started with ‘‘The rise of the sharing economy has fundamentally changed the business landscape, and some companies 

are going to have to adapt to survive.’’ And I think that sentence 

captures some essential characteristics about the sharing economy. 

It is new, it is changing, and it is adapting to meet market demands. In such a dynamic economic space, I think the committee’s 

approach towards this regulation is pragmatic, and, frankly, the 

correct course. Sharing platforms have provided two apparent benefits in particular. They have given workers another source of income in addition to traditional work options, and they have also 

given consumers additional choices. 

Ms. Smith—by the way—I am an Air Force pilot, so thank you 

for your service. And I am still in the Air Guard. I love it, so—but 

I want to say thank you for your service, and for—I guess your 

son’s as well, so that is fantastic. I appreciate your testimony, and 

for highlighting that many Uber driver use this service for supplemental income. Do you think this is something you are going to utilize long term? 

Ms. SMITH. Yes, absolutely. Yes. 

Mr. KINZINGER. And what is it you enjoy about it? What is it that 

makes you think that this is going to be a long-term process for 

you? 

Ms. SMITH. Just about everyone that I have driven has expressed 

the joy, really, at having the alternative. 

Mr. KINZINGER. Um-hum. 

Ms. SMITH. Whether they didn’t have a car at all, or they constantly relied on others to take them from place to place, or a bus 

was not available where they lived, or a taxi was more expensive. 

Whatever their reason was, they just were so grateful to have the 

opportunity to have a means of transportation that is affordable 

and safe. 

Mr. KINZINGER. And as a user of it, I can agree. And I will tell 

you what is neat too is the whole idea of the surge pricing. If you 

don’t have enough drivers, it helps drivers come online, to say that 

81 

there is a surge. Consumer makes a decision, the supply makes the 

decision, and it kind of works out for everybody. 

Mr. Beckerman, as sharing platforms proliferate, is there a way 

to maintain light touch regulations in a way that promotes competition on a level playing field, and can local governments peel 

back some unnecessary regulations on incumbents to some equilibrium that encompasses sharing platforms to the extent that they 

directly compete? 

Mr. BECKERMAN. Thanks for the question. Yes, I think so. I 

mean, we have seen two different kinds of regulations in local communities. Some that were maybe written in the ’70s and ’80s that 

just couldn’t anticipate any kind of Internet platform at all, and 

those are being peeled back. But we are seeing in some areas new 

regulations that are put in with the sole purpose of blocking, or discriminating, against these platforms, and those are the ones we are 

the most concerned about. 

Mr. KINZINGER. OK. And, Mr. Passmore, some commenters suggest that the insurance problems are too hard to solve when a 

sharing platform is involved. How has the insurance company 

worked to solve the coverage issues in the transportation network 

company context? Is the insurance industry hopeful that insurance 

questions raised by other types of sharing platforms can be resolved? 

Mr. PASSMORE. Yes. As I mentioned in my testimony, we have— 

we worked very hard with the sharing economy companies, the 

TNCs, to develop a solution that would work, and is being implemented in over half the States right now. 

As for other sharing economy businesses, I think a lot of them 

have sort of observed what has happened with the transportation 

network companies, and sort of been more proactive about making 

sure that their participants, whoever, whether it is Airbnb hosts, 

or Thumbtack vendors, or what have you, they are being more 

proactive and making sure that they are aware of the insurance 

issues, making it clear what kind of insurance they provide, and 

what they might have to get on their own. Those kind of developments are very encouraging. 

Mr. KINZINGER. And I think every major invention or leap in humanity, or leap in technology, or leap in any way we do business 

sometimes is met by resistance, and that is natural. People feel uncomfortable, they don’t know what the future holds. But the great 

thing, I think, about a free market, capitalistic economy like ours 

is we have the ability to adapt. And adapting is what makes us 

great, and, frankly, why we continue to lead the world. 

So, with that, Mr. Chairman, again, thank you for doing this. 

This is very beneficial, and thank you to the witnesses, and I yield 

back. 

Mr. BURGESS. The gentleman yields back. The Chair thanks the 

gentleman. The Chair recognizes the gentleman from North Caroline, Mr. Butterfield. Five minutes for questions, please. 

Mr. BUTTERFIELD. Thank you very much, Chairman Burgess, and 

Ms. Schakowsky, and members. Thank you very much for holding 

this hearing today, Mr. Chairman. I was just looking at the memorandum, and I think it is a very appropriate topic. It is sharing 

the—‘‘How the sharing economy creates jobs, benefits consumers, 

82 

and raises policy questions’’. A very appropriate topic, and I thank 

you so very much for it. 

As you know, Mr. Chairman, I am now the chair of the Congressional Black Caucus. For several months now we have been examining diversity among the Fortune 500 companies in America, and 

we realize that taking on 500 companies at one time is a daunting 

task, and so we have started to target the technology companies in 

particular. And we have found that African Americans have been 

largely excluded from all levels of technology. African Americans 

are a missing link in the tech economy, and until we see full participation in the tech economy, America will never truly unlock its 

full potential, and that is why I like the topic of this hearing. That 

is why, as part of my role as the chair of the CBC, I have focused 

on our efforts of increasing diversity within the technology sector. 

In May the CBC launched the CBC Tech 2020, which is an initiative to bring together the best minds in the technology, non-profit, education, and public sectors to chart a path forward to increase 

minority inclusion at all levels of the technology industry. The goal 

of CBC Tech 2020 is to achieve full representation of African Americans at every level of the industry in 5 years. Over the past few 

months I have taken this message across the country, and even to 

the heart of Silicon Valley. And now I would like to ask just a few 

questions on a few of these subjects. 

Let me start with Mr. Beckerman. Thank you for participating, 

and thank all six of you for participating today. Mr. Beckerman, as 

I said, I am interested in the inclusion of African Americans and 

other minorities in the technology industry, both as owners and 

employees, as well as vendors. How many companies, if you know, 

are members of—well, I am sure you know—are members of your 

association? 

Mr. BECKERMAN. Thirty-six. 

Mr. BUTTERFIELD. Thirty-six. Let me write that down, 36. 

Mr. BECKERMAN. I am glad I got that one. 

Mr. BUTTERFIELD. All right. I have got four here, so I don’t know 

how we are going to do on the other ones. Out of your companies, 

how many have African American CEOs, if you know? 

Mr. BECKERMAN. I would be happy to get back to you on that. 

Mr. BUTTERFIELD. All right. Question mark. Please get back. 

How many have an African American on their Board? 

Mr. BECKERMAN. I would be happy to get back to you with those 

numbers. 

Mr. BUTTERFIELD. All right. The reason I ask the Board question 

is because we found, of the top 20 technology companies, collectively they have 189 directors. And of those 189, three are African 

Americans, so we are particularly interested in that as well. And 

do you know if any of those companies have released their diversity 

data? I know they do the EEO–1s, but have any of these made 

their diversity data reports public? 

And now we are seeing the trend in Silicon Valley that companies are now opening up their EEO reports for the world to see, 

and they are making a commitment to us that they are going to 

work with us in trying to improve it. 

Mr. BECKERMAN. Yes. I just want to say I appreciate what you 

are doing, and our companies realize there is a lot of work to be 

83 

done, and they are making strides to improve, but I do think that 

these platforms do create a lot of opportunities both for direct employment, and what—the opportunities that we see on the sharing 

platforms that we are talking about today. But thank you for your 

work on this, and it is something that I know our companies are 

striving to do better. 

Mr. BUTTERFIELD. I really want you to pay attention to it, and 

I won’t call up the CEO’s name that I met with in Silicon, but all 

of you would recognize the name. He told us that there is a correlation between the bottom line and diversity, that you—that the profits are really related to diversity and inclusion, and if you can get 

those two in sync, you can really grow the economy, grow the consumer base, and the company can do very well. So I look forward 

to working with you. And thank you, Mr. Chairman. I yield back. 

Mr. BURGESS. The Chair thanks the gentleman. The gentleman 

yields back. The Chair recognizes the gentleman from Kentucky, 

Mr. Guthrie. Five minutes for questions, please. 

Mr. GUTHRIE. Thank you, Mr. Chairman, I appreciate it. I am 

also a member of the Education and Workforce Committee, and we 

were having a meeting downstairs. Sorry I didn’t hear all this on 

a joint employer, and the definition of joint employer. So I say that 

because I am from the business world as well, and labor issues are 

something I have worked on and understand, that labor classification issues are at the forefront of this debate. 

But in your—so this is to Mr. Beckerman. So in your testimony 

you urged Congress to consider the real benefits of the sharing 

economy before moving too quickly into regulations. And what are 

some of the most critical benefits offered by these platforms that 

would be affected if service providers on these platforms are classified as something other than independent contractors? 

Mr. BECKERMAN. Thank you for the question. I think first and 

foremost there is incredible flexibility, and we have heard a lot of 

that today from Ms. Smith and others. On all these platforms it is 

opt-in, and a majority of the people participating on these services 

are doing so part time. They are doing it to have new income, not 

necessarily replacing a full time job that they had before, and the 

ability to be your own boss. That is compelling to a lot of people, 

to be able to set your own schedule, and really work for yourself 

as a small business person, and I think that is probably top of the 

list. 

Mr. GUTHRIE. OK. Again, Mr. Beckerman, when we consider the 

extent of consumer protection regulations that should exist for 

sharing platforms, we have heard today that reputation mechanisms, like rating systems, lessen the need for certain consumer 

protection regulation. What kinds of consumer protection regulation should apply to apps, such as Uber? 

Mr. BECKERMAN. There are a few things. When it comes to data 

security and privacy, I just want to note that there are laws in the 

books, and regulations, the FTC and other places, that apply to all 

platforms, online and offline, and I don’t think there are gaps in 

that kind of coverage. But when it comes to rating systems, there 

is incredible transparency and accountability that really never existed before, being able to rate the driver, and have the driver rate 

you, and on Airbnb, and other platforms, being able to see peoples’ 

84 

past experiences. And I think this is a new innovation, and it is 

important. 

Mr. GUTHRIE. And what about apps for TaskRabbit? Same—— 

Mr. BECKERMAN. Same. 

Mr. GUTHRIE [continuing]. Situation? Well, thanks. I know on 

Uber you can see the picture of the driver, and understand there 

have been a couple instances in Chicago where somebody has 

pulled up, say, you looking for an Uber driver? And they—and it 

is not an Uber driver. So those protections seem to be in there, if 

somebody checks their—— 

Mr. BECKERMAN. I think those protections are working, and what 

you see with all these platforms you mentioned, TaskRabbit and 

others, trust is first, but also a community has been created where 

you want to have a higher level of service for your customers because you know you are being rated on an instant basis, and you 

are being rated many times throughout the day. And I think that 

helps what you are asking for. 

Mr. GUTHRIE. Yes. I think in the incidents in Chicago people 

were getting in the car—somebody just pulled up and looked like 

they were looking for an Uber driver, but if somebody followed 

what Uber provided, either the picture, or the car, the make, the 

model, that wouldn’t have happened. 

Mr. BECKERMAN. If they don’t know your name, you know, don’t 

get in the car. 

Mr. GUTHRIE. So, Mr. Lieber, I am going to—how much time did 

a person usually spend trying to track down local professional services before Thumbtack? 

Mr. LIEBER. That is a great question, and we don’t have a scientific answer for you, but I am sure, from your own experience, 

you have tried to hire a—somebody for your house, a plumber—and 

my parents have lived in the same house for 40 years, they still 

don’t know who to go to to find a plumber. So they found Thumbtack is a really useful tool for them to bring somebody to their 

house who is trusted, and is going to do a great job. 

Mr. GUTHRIE. Does Thumbtack reduce the cost of looking for— 

I guess it is self-evident in your answer here—reduce the cost for 

looking for the right professional? 

Mr. LIEBER. On both sides of the marketplace, we believe 

Thumbtack dramatically reduces the cost, both search time for the 

consumers—it is time you could be spent hanging out with your 

kids, as opposed to calling people and trying to find somebody who 

is right for you. And on the pro side, finding new business is a really hard thing to do. Finding a new client, you put an ad out in the 

paper, maybe, you know, the name of our business is Thumbtack 

because it is named after the pins people used to put on bulletin 

boards, where they would just put this up on the bulletin board, 

and hope that somebody called them. And that system is really outdated today, and we think that we are lowering the cost of that, 

finding them new customers. 

Mr. GUTHRIE. Thank you very much. And it is good for our businesses to have that opportunity. I always say—difference in our 

system in the world and everywhere else is that everybody that becomes a plumber, or skilled trades, eventually usually becomes 

their own boss, especially in the plumbing business and HVAC 

85 

business. You see a lot of people with vans with their name on the 

side, my name, Inc., and they are driving around. And helping 

them market is a great opportunity for those who provide it, as 

well as those who receive it. 

Mr. LIEBER. Absolutely. And a lot of these are skilled professionals who are really great plumbers, maybe don’t know how to 

run their own business. And that is where companies like Intuit 

and Thumbtack come in, to help them market themselves a lot 

more—in a lot more sophisticated manner. 

Mr. GUTHRIE. Because they are very much in demand. Mr. 

Chriss, you had a comment on that? 

Mr. CHRISS. Just to pile onto that, one of the—having served 

small businesses for a number of years, one of the top challenges 

that our small businesses face is finding customers, and many of 

these new platforms are now allowing them to, again, with the 

push of a button, find that customer, to allow the individual to 

spend more time actually making money. 

Mr. GUTHRIE. It only works because you have customers looking 

for them. So it is a win-win. 

Mr. CHRISS. It is. 

Mr. GUTHRIE. Thank you very much, I appreciate that, and I will 

yield back. 

Mr. BURGESS. The gentleman yields back. The Chair thanks the 

gentleman. The Chair now recognizes the gentlelady from Indiana, 

Mrs. Brooks. Five minutes for questions, please. 

Mrs. BROOKS. Thank you, Mr. Chairman, for holding this fascinating hearing. I co-chair what is called the Women in High Tech 

Caucus here. It is a bipartisan group that is about promoting 

women and leadership in the tech companies as well, and—so I 

talk with a lot of tech companies, particularly in Central Indiana, 

where I am from, and I can’t tell you how excited the sharing economy is to so many people, and whether—particularly when we have 

hack-a-thons, whether it is for businesses, or whether or not it is 

for State Governments, or Federal Government, there is so much 

energy and excitement about the sharing economy, and the platforms that are coming forward. And I—we also have what is called 

1150 Academy in my district, which is teaching people how to code, 

which is so critical to all of this, and all of these new platforms. 

But I have to tell you, there are—there is a lot of concern, and— 

particularly generational, probably more than anything, when it 

comes to this sharing economy, and the questions about the sharing economy, so I think this type of hearing—and I hope, Mr. 

Chairman, there are going to be more hearings on this, because I 

don’t think it is really cut and dry on a lot of these issues. There 

are a lot of questions. 

But I do have to ask, Mr. Beckerman, it—and I am a former deputy mayor in Indianapolis, and I know that State and local regulations can really get in the way, and I know that a lot of these platforms, and a lot of these innovations have struggled with State and 

local regulations. And I know that it often can be used in many 

ways to block competition, and to block innovation. Can you share 

a bit more about what we, in looking at what the Federal Government should be doing, what lessons can we be learning about what 

is happening maybe at State and local issues around the country? 

86 

Mr. BECKERMAN. Sure, thank you. Competition obviously is important for consumers in all communities, and our companies have 

made great strides in working with local mayors and local city governments to make sure their services are allowed to operate in 

those communities. But I think the leadership of this committee, 

and of Congress, talking to your local mayors, and even your Governors, and, you know, taxi commissions, as appropriate, that they 

should allow these services to operate because it is benefitting consumers. It is providing more choice, it is lowering costs, and that 

is what this is really all about. 

Mrs. BROOKS. And so this is an education process you are undertaking at mayor—with individual mayors, or at association meetings, or how are you doing it? 

Mr. BECKERMAN. Both. You know, the companies are actually 

working city by city, town by town, State by State in a lot of places. 

And you asked for some examples, you know, we have seen areas 

where they are putting new regulations in place, such as saying 

for—on the ride sharing side, you have to wait 40 minutes before 

a car picks you up, which obviously does not have any consumer 

benefits at all. It is just meant to block competition. Or regulations 

that say the minimum fare must be $50, which is 10 times the fare 

of a taxi, which, again, has no consumer benefits whatsoever. And 

so those are the things we are trying to get rid of. 

Mrs. BROOKS. Thank you. Mr. Chriss, there were conversations 

and discussions about protecting consumers’ financial data, and obviously, in today’s day and age, when we rely so heavily on technology for all—so many financial transactions, how is this different, 

if it even is different? How is the sharing economy any different 

than the other ways in which we transact business, or is it essentially the same? 

Mr. CHRISS. I think in many ways it is still the same. The—all 

of our partners, including ourselves, need to think of data privacy 

as chief, and we need to maintain the stewardship that we have 

of our customers’ data. When it comes to consumer protections, 

again, I think there isn’t much difference that we have seen in the 

number of companies. 

I do want to mention, we have talked a lot about Uber as an example here today. It should be said that we have seen over 200 

other platforms, sharing economy platforms, coming in that are impacting all sorts of different businesses. And so... 

Mrs. BROOKS. Can you give us some examples? 

Mr. CHRISS. Absolutely, and these would be ones that might surprise you. So we have talked some about food delivery, and caring 

for your dog, but there are some that are disrupting industries like 

the legal industry. So one of our partners, Up Council, has provided 

an opportunity for lawyers to come in, and, again, find clients that 

are perfectly matched to them. Or a company called Hourly Nerd, 

which allows MBAs to be partnered with the right Fortune 500 

company as well. So this is very broad, and, again, we are very 

early in this journey, but with over 200 now, it will be amazing to 

see how that grows over the next few years as well. 

Mrs. BROOKS. I would be curious, Mr. Lieber, with respect—because I think one of the things that we are—we are often concerned 

about, whether it is with Airbnb, whether it is with Uber, whether 

87 

it is with the providers that you are—or the people who are going 

into the homes, providing services, the safety issues that are discussed, can you talk about that a little bit with respect to Thumbtack, and how you educate your customers, as well as the people 

who are providing the services? What kind of safety issues are addressed, with respect to—whether it is criminal history background 

checks, whether it is just educating your customers about what 

kind of background checks have been done or not been done, and 

informing them? 

Mr. LIEBER. Yes. So we do background checks on every professional who is active on Thumbtack to make sure that we are delivering somebody that we can be proud of to your house. Marketplace 

integrity is incredibly important to us. We have a large team dedicated to that. We kick off any bad actors who we think have violated our principles of marketplace integrity, and we do everything 

we can to ensure that we are delivering a trusted professional to 

your house. Reviews are a part of that. We try to do everything we 

can to collect and aggregate reviews so you have the most information to make an informed decision, and we police this very, very 

carefully. 

Mrs. BROOKS. Thank you. My time is up. I yield back. 

Mr. BURGESS. The gentlelady’s time has expired. The Chair 

thanks the gentlelady. The Chair recognizes the vice chair of the 

full committee, Mr. Lance of New Jersey. Five minutes for questions. 

Mr. LANCE. Thank you, Mr. Chairman. I apologize to the panel 

for being late. I was in continuing legal education over at the Library of Congress, in the hopes perhaps someday there will be a 

lawyer app that will employ me. 

Mr. Baker, I certainly understand your point. Would it be fair to 

say that the distinction between independent contracts and employees is an ongoing discussion in our society, and has been for quite 

some time? 

Mr. BAKER. Sure. I mean, the issues certainly pre-date the rise 

of the sharing economy companies. 

Mr. LANCE. For example, I sold real estate. I was not the broker. 

I was merely an agent, and I was treated as an independent contractor, and I think that is traditional in the real estate industry. 

Is that your understanding of it, as it—how it works in real life? 

Mr. BAKER. To be honest, I couldn’t tell you whether most realtors are treated as independent contractors or employees. I—— 

Mr. LANCE. I believe most salespersons are treated as independent contractors, although there certainly is significant guidance. I was trained as to how to answer the telephone. I was 

trained how to try to sell real estate, but definitely I was an independent contractor. 

You state in your testimony, regarding Uber and Lyft, that there 

have been several cases brought before the NLRB, and in Federal 

Court, arguing that those working in these companies are employees. Has either the NLRB or the Federal Courts adjudicated any 

of those questions yet? 

Mr. BAKER. No, there has been no final adjudication on that. 

Those cases are still pending. 

88 

Mr. LANCE. I see. And do you expect that there will be a decision 

at some point in the near future? 

Mr. BAKER. It depends on your definition of near. I suspect we 

are talking about a couple years before we get anything resembling 

a final decision. 

Mr. LANCE. I see. And anything that is adjudicated by the NLRB 

then potentially could be appealed, probably to the United States 

Court of Appeals for the District of Columbia. Is that accurate? 

Mr. BAKER. Exactly, yes. 

Mr. LANCE. Yes. Thank you. Mr. Beckerman, I also was greatly 

interested in your testimony, and you point out that this is a growing phenomenon in this country, and that there are internal checks 

regarding all of this. Could you elaborate a little greater on your 

point of view in that regard? 

Mr. BECKERMAN. Absolutely. There are certain transparency, and 

accountability, and trust features that are built into the platforms. 

Again, on the rating system, it is something that doesn’t exist in— 

for many of the incumbents. Being able to track your location, in 

many cases, does make you safer. Or, if you end up leaving your 

purse or your bag in the car, that helps you retrieve that. And so 

there are a lot of things built into technology, and that has worked 

out very well. 

Mr. LANCE. Thank you. I point out particularly of—four points 

that you articulated. You stated, second, in weighing these clear 

benefits against perceived harms, lawmakers should consider 

whether sharing economy services may, in fact, be safer for consumers when compared to their incumbent counterparts. And number four, recognizing that sharing economy platforms already selfregulate through various mechanisms that are hardwired into the 

technology, such as consumer ratings, payment systems, intense 

competition, and GPS tracking. I tend to agree with that. This is 

obviously a growing phenomenon in this country. 

And, Mr. Beckerman, you state that in a pre-Internet age the 

Yellow Pages served as a similar function that Lyft and Uber serve 

today. Would you explain your point of view regarding that? 

Mr. BECKERMAN. Sure. At the basic level, these are technology 

platforms that are removing friction between the transaction, and 

they are connecting the supply and the demand. Be it a plumber, 

or a driver, a home that you are trying to rent—— 

Mr. LANCE. Um-hum. 

Mr. BECKERMAN [continuing]. And having that frictionless transaction, I think, helps the economy—— 

Mr. LANCE. Um-hum. 

Mr. BECKERMAN [continuing]. And it certainly helps the individuals on both sides of the transaction. 

Mr. LANCE. Thank you. Finally, in the last 50 seconds, I will relate a story—when I sold real estate, the real estate broker told me 

that if the property was 20 minutes farther west from where the 

potential customer wanted to live, I was to create interesting conversation in the automobile and drive as fast as I could. Thank you 

very much. Mr. Chairman, I yield back 27 seconds. 

Mr. BURGESS. The gentleman yields back. The Chair thanks the 

gentleman. The Chair recognizes the gentleman from Mississippi, 

Mr. Harper. Five minutes for questions, please. 

89 

Mr. HARPER. Thank you, Mr. Chairman. Thanks to each of you 

for being here today. And, Mr. Chriss, if I could ask you a question? What has been your clients’ feedback as they transitioned 

successfully to sharing platforms as a source of income, and then 

are they happy with their choice. So looking for what the feedback 

would be that you are hearing right now. 

Mr. CHRISS. Thank you for the question. The feedback we are 

hearing right now is certainly a happiness factor from being able 

to be their own boss, and control their own income streams. The 

shadow to that has been—not sure that they understood they were 

becoming a small business when they entered into this. 

Again, if you think about the—for many of them the feedback 

was it was so easy to download an application and create income, 

and then I realized I now have to pay quarterly taxes, I have to 

track my expenses, I have to track mileage. Many of these folks are 

working in an app that is on the palm of their hand, and yet when 

you ask a driver to open up their glove box, it is littered with receipts. And so this change in mindset, of going from, hey, this was 

very easy to enter into this economy has been a true positive, with 

the shadow of, I now have a whole bunch of obligations that I 

wasn’t sure I was set up to do. 

Mr. HARPER. And has there been a change in the way that is now 

initiated, so that there is a better understanding from the beginning for these? 

Mr. CHRISS. You know, there is, and, I mean, this is why we created the QuickBooks Self-Employed product that we have, and we 

have seen—certainly we track our customer success metrics as 

well, and we have seen that with our product we put $3,800 of tax 

savings back into our customers’ hands. 

The difficulty, though, is there are still challenges when—January to April of every year, when an independent contractor receives 

a 1099, their first call is to their platform, who sent them the 1099, 

and the response from that platform is, I am sorry, I can’t even answer your question, you have to go find a tax professional. 

Mr. HARPER. Right. 

Mr. CHRISS. So there are still some real challenges in the system 

that I think we could, again, create some clarity around to make 

things easier. 

Mr. HARPER. You had mentioned in your testimony that people 

who provide services through sharing platforms would benefit from 

some guidance from the platforms on how to operate successfully, 

and I guess that would be the main takeaway, then, on what you 

are saying, is that training up front, that knowledge up front, 

would be the biggest benefit for them? 

Mr. CHRISS. There are a number of our users that have come in 

that, again, didn’t even know what they were getting into. They are 

happy to be where they are, but being able to provide some guidance from the platforms, again, not necessarily providing the answer, but at least providing the guidance would certainly be beneficial. 

Mr. HARPER. So what they have to do on their income tax, but 

also the regulatory requirements that may go with that as well, it 

sometimes—can take some of the joy out of it if they don’t know 

that on the front. 

90 

Mr. CHRISS. What we have seen from our customers is, once they 

know, and once they are able to do the calculations through our 

product, or through whatever, they are happy to do it. 

Mr. HARPER. Good. 

Mr. CHRISS. It is the lack of transparency, and the lack of understanding, that is the most difficult. 

Mr. HARPER. Mr. Passmore, when we talk about property casualty insurance, and what that entails, what are the incentives for 

the insurance industry to participate in the sharing economy? 

Mr. PASSMORE. Opportunity. Insurers like to sell insurance, 

and—— 

Mr. HARPER. Sure. 

Mr. PASSMORE [continuing]. They are—these businesses certainly 

represent opportunities to do that by developing new products. A 

good example is the transportation network companies, particularly 

in the States where they put in place the clear insurance rules, so 

the rules of the road are established, and certainty is established. 

We have seen companies introduce a lot of different products. 

One—a PCI member company, Erie Insurance, was one of the 

first to introduce an endorsement that you could buy for your personal auto policy to provide coverage for transportation network 

drivers. And other companies, such as Geico, and Progressive, and 

MetLife and Home, have all introduced products. Some have had— 

some have introduced even separate policies just for TNC drivers. 

Some have had partnerships with some of the TNCs to develop 

products just for their drivers. 

Mr. HARPER. So do you see the future—how would you describe 

the future for property casualty insurance in this economy? 

Mr. PASSMORE. Well, I think it is a great opportunity for insurers, as long as there are clear rules of the road, and certainty has 

been established. You know, with the TNCs, we have had—we had 

a little bit of a bumpy road, but we got there in the end, and we 

are making excellent progress on it now. We may not need that 

kind of clarification in every other kind of sharing economy model, 

but there may be some needs for that. So the ability to develop that 

certainty, so the insurance industry can grow along with the sharing economy, is going to be very important. 

Mr. HARPER. And with that, I yield back, Mr. Chairman. 

Mr. BURGESS. The gentleman yields back. The Chair thanks the 

gentleman, and the Chair wants to thank all the members, and the 

witnesses, for being here today. Seeing that there are no further 

members wishing to ask questions, I do want to thank each of you 

for participating in today’s hearing. Before we conclude, I will yield 

to Ms. Schakowsky for a unanimous consent request. 

Ms. SCHAKOWSKY. Yes. I would like to add a statement of 

Vaughn Armour from the New York Committee for Change into the 

record, testimony that I referred to earlier of Indir Pamar, a New 

York taxi worker, and, let us see—Uber worker, actually—testimony from the Taxicab, Limousine, and Paratransit Association, 

and testimony from Working Partnership U.S.A., San Jose, California, into the record. 

Mr. BURGESS. Without objection, so ordered. 

[The information appears at the conclusion of the hearing.] 

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Mr. BURGESS. I also want to include the following documents to 

be submitted for the record by unanimous consent: a statement for 

the record from the American Hotel and Lodging Association, a 

statement for the record from the Hotel Association of New York 

City, a statement for the record from the Texas Hotel and Lodging 

Association. Without objection, so ordered. 

[The information appears at the conclusion of the hearing.] 

Mr. BURGESS. Pursuant to committee rules, I remind members 

they have 10 business days to submit additional questions for the 

record. And I would ask our witnesses to submit their responses to 

those questions within 10 business days upon receipt of the questions. 

So, again, thanks all to everyone here. Without objection, the 

subcommittee is adjourned. 

[Whereupon, at 11:55 a.m., the subcommittee was adjourned.] 

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