Category: Regulations

Regulators Threaten App Startups That “Give People Access to Their Pay as They Earn It”

(p. B5) WASHINGTON—A growing industry of financial apps that allow workers to access their pay early is drawing scrutiny from regulators to prove they are different from payday lenders.

. . .

Last month, regulators from New York and 10 other states said they were investigating whether some payroll-advance firms violated payday-lending laws. In California, state lawmakers are debating a law that aims to set the legal foundation for the industry and provide consumer protections, the first such attempt in the country.

The moves by state officials come as the industry is growing. Leslie Parrish, an analyst for research firm Aite Group, said the industry is “poised for exponential growth.” Aite Group estimated the app companies handled 18.6 million early U.S. payroll transactions valued at more than $3.15 billion in 2018.

. . .

Industry executives and some consumer advocates say the services offer the potential to help lower- and moderate-income workers by providing low-cost tools, though they disagree on how businesses should be structured and regulated.

“It hasn’t solved the income inequality problem,” Todd Baker, a senior fellow at Columbia Business School, said. “What it does is replace, for a nominal cost, the $30, $40 people pay today for a single overdraft or a $200 payday loan.”

. . .

“In the U.S., we have this pay cycle that holds back people’s pay,” said Ram Palaniappan, chief executive of Earnin. “What we have been able to do is to give people access to their pay as they earn it.”

Earnin tracks users’ work and pay schedules using time sheets or location services and will deposit up to $500 per pay period in their bank accounts. Rather than charging fees for its service, Earnin asks users to consider voluntary tips of up to $14.

For the full story, see:

Yuka Hayashi. “Pay-App Startups Draw Scrutiny.” The Wall Street Journal (Tuesday, Sept. 3, 2019): B5.

(Note: ellipses added.)

(Note: the online version of the story has the date Sept. 2, 2019, and has the title “Pay-Access Apps Face Regulatory Test.”)

Lyft Driver Fears California Law Will Destroy Her Work Flexibility

(p. B4) California lawmakers have hailed the law signed by Gov. Gavin Newsom this week that could require drivers of ride-hailing companies to be labeled as employees rather than independent contractors, saying the measure could raise wages and provide new workplace benefits.

But the drivers are divided about how it will affect them.

For Rachel Hudson, a 43-year-old driver for Lyft Inc. who struggles with arthritis and an anxiety disorder, the bill’s passage is unwelcome. Ms. Hudson has driven for Lyft for about five years and fears employment status could mean having to work in scheduled shifts that would wipe out the flexibility she needs.

“Sometimes, I need a two- to three-hour break. I can’t always be relied upon to be at work at specific times,” Ms. Hudson said. Driving for Lyft “is the only way I can afford a car. It makes a huge impact on my life.”

Ms. Hudson, who lives alone in Stockton, Calif., said that besides federal disability benefits, the earnings from Lyft are her only income.

For the full story, see:

Sebastian Herrera. “Uber, Lyft Drivers Torn Over Law Meant to Protect Them.” The Wall Street Journal (Monday, Sept. 23, 2019): B4.

(Note: the online version of the story has the date Sept. 21, 2019, and has the title “Uber, Lyft Drivers Torn as California Law Could Reclassify Them.”)

New York City Regs Force Arthritic Woman to Push Cart to Laundromat Instead of Using Her Laundry Room

(p. A1) When Jean Harrow got a ticket in 2016 for unauthorized renovations to her Queens home, she thought it was a misunderstanding. Yes, she had put a powder room in her basement without realizing she needed a permit. But surely, she said, she wasn’t responsible for the washer and dryer a previous owner had installed downstairs — illegally, according to the $1,600 citation. She would simply explain that at her hearing.

As she waited to do just that, Ms. Harrow got a second ticket — for “failure to comply” with the first. In the 14 months after the original citation, she received five others for the same issue: $15,600 in additional fines. Each meant another hearing, and although she never missed a court date, the tickets kept coming.

Thousands of small property owners in New York City have been hit with a similar pileup of fines, an unintended result of a decade-long crackdown set off by fatal construction accidents. In recent years, the city’s Buildings Department has hired hundreds of new inspectors and doled out harsher penalties for violators. But rules introduced as a safeguard have become a costly trap for ordinary people, The New York Times found.

. . .

(p. A23) Ms. Harrow admits she made a mistake: She should have sought a permit to install the toilet and sink that piggybacked on plumbing already in her laundry room. But, she said she told the inspector, “I didn’t run those pipes — I bought it like this.”

To correct the violation, Ms. Harrow needed to have the unauthorized plumbing removed. Before she could get the permit, however, she had to pay a $1,500 civil penalty.

Pulling the money together took months. The receipt for the payment was lost, then found. Her permit request was rejected several times, because of errors a plumber had made on the application. She received another fine during this period.

At Ms. Harrow’s final hearing, the agency lawyer reduced two fines imposed after the permit came through. But Ms. Harrow was on the hook for the rest. Besides losing the bathroom, she would be out $13,100 in fines plus interest, as well as permit costs, plumbers’ fees, two taxi fares, and a washer and dryer. A different permit would have allowed her to keep the laundry room, but the process would have been even more expensive.

“Now I have to be pushing a cart to go to the wash,” she said. “I have rheumatoid arthritis.”

Ms. Harrow said she tried to put $50 a month toward the fines. “But sometimes, to tell you the truth, I can’t make it.”

For the full story, see:

Grace Ashford. “Snowballing Tickets Bury Homeowners in Debt.” The New York Times (Monday, September 9, 2019): A1 & A22-A23.

(Note: ellipsis added.)

(Note: the online version of the story has the same date as the print version, and has the title “The Law Was Aimed at Deadly Machinery. It Hit Her Washer.”)

California Anti-Gig-Worker Regulations Have “Unintended Victims”

(p. B1) SAN FRANCISCO — After months of bickering over who would be covered by a landmark bill meant to protect workers, California legislators passed legislation on Wednesday [Sept. 11, 2019] that could help hundreds of thousands of independent contractors become employees and earn a minimum wage, overtime pay and other benefits.

. . .

In California, religious groups said they feared that small churches and synagogues would not be able to afford making pastors and rabbis employees. Winemakers and franchise owners said they were worried they could be ensnared by the law, too. Even some of the contractors for the app-based businesses that have been at the center of this debate said the change could hurt them if companies like Uber, Lyft and DoorDash decided to restrict how often they could work or cut them off entirely.

. . .

(p. B4) Small vineyard owners are concerned that they could be forced to directly employ the independent truckers they use to haul their harvests and become responsible for providing insurance and workers’ compensation. Currently, truckers operate as contractors, with their own rigs and insurance, and serve several vineyards, said Michael Miiller, director of government relations at the California Association of Winegrape Growers.

“Our members are growers, not trucking companies,” Mr. Miiller said. “The target of legislators is Uber and Lyft, but the unintended victims are small, independent vineyards on the coast of California.”

Saunda Kitchen owns a Mr. Rooter plumbing business in Sonoma County that has 30 employees, for whom she pays payroll taxes and provides the various mandated benefits. But Ms. Kitchen said she believed that she herself would have to become an employee of Mr. Rooter under the new law, which could cause the parent company to pull out of the state.

“I wouldn’t have access to new technology, training, help with marketing,” said Ms. Kitchen, who planned to talk with Mr. Rooter officials on Thursday [Sept. 12, 2019] about how to proceed.

For the full story, see:

Kate Conger and Noam Scheiber. “Gig-Worker Law Sows Confusion and Defiance.” The New York Times (Thursday, September 12, 2019): B1 & B4.

(Note: ellipses, and bracketed dates, added.)

(Note: the online version of the story has the date Sept. 11, 2019, and has the title “California’s Contractor Law Stirs Confusion Beyond the Gig Economy.”)

Consumers May Again Be Free to Choose an Incandescent Bulb

(p. A1) The Trump administration plans to significantly weaken federal rules that would have forced Americans to use much more energy-efficient light bulbs, a move that could contribute to greenhouse gas emissions that cause global warming.

The proposed changes would eliminate requirements that effectively meant that most light bulbs sold in the United States — not only the familiar, pear-shaped ones, but several other styles as well — must be either LEDs or fluorescent to meet new efficiency standards.

The rules being weakened, which dated from 2007 and the administration of President George W. Bush and slated to start in the new year, would have all but ended the era of the incandescent bulb invented more than a century ago.

. . .

The Trump administration said the changes would benefit consumers by keeping prices low and eliminating government regulation.

For the full story, see:

John Schwartz. “New Rollback To Ease a Ban On Old Bulbs.” The New York Times (Thursday, September 5, 2019): A1 & A15.

(Note: ellipsis added.)

(Note: the online version of the story was last updated Sept. 6 [sic], 2019, and has the title “White House to Relax Energy Efficiency Rules for Light Bulbs.”)

U.S. Forest Service Regulations Delay Monitoring Signs of Volcanic Eruptions

(p. D1) On Mount Hood, “any little thing that happens could have a big consequence,” said Dr. Moran, scientist-in-charge at the federal Cascades Volcano Observatory.

And yet the volcano is hardly monitored. If scientists miss early warning signs of an eruption, they might not know the volcano is about to blow until it’s too late.

Determined to avoid such a tragedy, Dr. Moran and his colleagues proposed installing new instruments on the flanks of Mount Hood in 2014. Those include three seismometers to measure earthquakes, three GPS instruments to chart ground deformation and one instrument to monitor gas emissions at four different locations on the mountain.

But they quickly hit a major hiccup: The monitoring sites are in wilderness areas, meaning that the use of the land is tightly restricted. It took five years before the Forest Service granted the team approval in August.

The approval is a promising step forward, but Dr. Moran and his colleagues still face limitations, including potential legal action that may block their work.

Such obstacles are a problem across the United States where most volcanoes lack adequate monitoring. Although federal legislation passed in March could help improve the monitoring of volcanoes like Mount Hood, scientists remain concerned that red tape could continue to leave them blind to future eruptions, with deadly consequences.

For the full story, see:

Shannon Hall. “Eruptions of Red Tape.” The New York Times (Tuesday, September 10, 2019): D1 & D6.

(Note: the online version of the story has the date Sept. 9, 2019, and has the title “We’re Barely Listening to the U.S.’s Most Dangerous Volcanoes.”)

California Passes Statewide Rent Control

(p. A20) California lawmakers approved a statewide rent cap on Wednesday [Sept. 11, 2019] covering millions of tenants, the biggest step yet in a surge of initiatives to address an affordable-housing crunch nationwide.

The bill limits annual rent increases to 5 percent after inflation and offers new barriers to eviction, providing a bit of housing security in a state with the nation’s highest housing prices and a swelling homeless population.

. . .

“Caps on rent increases, like the one proposed in California or the one recently passed in Oregon, are part of a new generation of rent-regulation policies that are trying to thread the needle by offering some form of protection against egregious rent hikes for vulnerable renters without stymieing much-needed new housing construction,” said Elizabeth Kneebone, research director at the Terner Center for Housing Innovation at the University of California.

. . .

Even as more states begin to experiment with rent control, it has long existed in places like New York City, which intervened to address a housing shortage post-World War II, and San Francisco, where it was adopted in 1979.

Today it is common in many towns across New Jersey and in several cities in California, including Berkeley and Oakland, although the form differs by jurisdiction. Regulated apartments in New York City are mostly subject to rent caps even after a change in tenants, for example, while rent control in the Bay Area has no such provision.

In New York City, where almost half of the rental stock is regulated, a board determines the maximum rent increases each year; this year it approved a 1.5 percent cap on one-year leases, considerably lower than the limits passed in Oregon and California.

For the full story, see:

Conor Dougherty and Luis Ferré-Sadurní. “California Passes Statewide Rent Control in Effort to Ease Housing Crisis.” The New York Times (Thursday, September 12, 2019): A15.

(Note: ellipses, and bracketed date, added.)

(Note: the online version of the story has the same date Sept. 11, 2019, and has the title “California Approves Statewide Rent Control to Ease Housing Crisis.” The online version says that the page of the New York print edition was A16. The page number in my National edition was A15.)

Medical Paperwork Wastes Resources and Burns Out Physicians

(p. A23) Consider the use of medical scribes, who complete doctors’ electronic paperwork in real time during patient visits. The American College of Medical Scribe Specialists reported that 20,000 scribes were working in 2014, and expects that number to climb to 100,000 in 2020.

I have heard doctors say they need a scribe to keep up with electronic medical records, the mounting demand of which is driving a burnout epidemic among physicians. Scribes allow doctors to talk with and examine patients without having a computer come between them, but at base they are a workaround for the well-known design flaws of electronic medical records.

As a nurse, when I first learned about scribes, I was outraged. On the job, nurses hear repeatedly how health care companies can’t afford to have more nurses or aides to work with patients on hospital floors — and yet, money is available to pay people to manage medical records. Doctors who use scribes tend to see their productivity and work satisfaction increase, but the trade-off is still there: Scribes demonstrate the extent to which paperwork has become more important than patients in American health care.

For the full commentary, see:

Theresa Brown. “Our Jury-Rigged Health Care.” The New York Times (Friday, September 6, 2019): A23.

(Note: the online version of the commentary has the date September 5, 2019, and has the title “The American Medical System Is One Giant Workaround.”)

California Uber Regulation Reduces Drivers’ Freedom to Choose

(p. A27) Drivers are at the heart of the ride-share business. They’re also at the heart of the debate over a bill approved by California’s legislature, A.B. 5, which aims to solidify gig workers’ legal status as employees. Uber and Lyft have always classified drivers as independent contractors. But many lawsuits over the years, by drivers and others, have put that classification under question. A.B.5 is intended to help drivers by creating a set of criteria under which Uber or Lyft drivers could be considered employees of those companies, and therefore entitled to the benefits and protections of employees.

So why would some drivers be against it?

I spent nearly a year driving part time for Uber and Lyft, and then left my job as an engineer to cover the industry full-time through my blog “The Rideshare Guy.” After thousands of conversations with drivers, I’ve found that while they come from all walks of life, one of the main reasons they value this work is flexibility. As a driver, you can work almost as much or as little as you want, cash out your pay instantly, take a break at a moment’s notice, or even go on a six-month vacation. This flexibility and that feeling of not having a boss makes ride-hail driving stand out in the vast array of service jobs and low-wage work.

For the full commentary, see:

Harry Campbell. “Uber Drivers Just Want to Be Free.” The New York Times (Tuesday, September 17, 2019): A27.

(Note: the online version of the commentary has the date Sept. 16, 2019, and has the same title as the print version.)

Physician-Scientists Should Be Allowed to Discover Cures

(p. A27) Time and again, physician-scientists have changed the history of medicine by identifying a problem in the clinic and taking to the lab to address it. Alexander Fleming watched men die of sepsis during World War I while serving in the Royal Army Medical Corps, then returned home to create penicillin. Sidney Farber, a young physician at Children’s Hospital in Boston, committed himself to finding treatments for childhood leukemia, and laid the foundation for modern cancer chemotherapy.

In the 1970s, the physicians Michael Brown and Joseph Goldstein set out to understand how a young child’s arteries could be as clogged as those of an overweight septuagenarian. This patient-inspired research led to the discovery of LDL-cholesterol receptors, and paved the way for the statin drugs that are taken by millions of people every year in the United States alone.

And more recently, the research efforts of two physicians, Brian Kobilka and one of us, Dr. Lefkowitz, seeking to understand how hormones conferred their biological effects, led to the discovery of a large family of receptors that have formed the basis for the development of hundreds of F.D.A.-approved medications.

. . .

Unfortunately, the career path of the physician-scientist has become longer and a lot less appealing. In the United States, about 20,000 graduates emerge from medical school each year, many with significant debt. Many physicians are well into their 30s by the time they complete their clinical training. Doctors who decide to take the research path face the daunting prospect of many more years struggling to win grants and establish a lab. According to N.I.H. statistics, researchers with medical degrees on average receive their first major N.I.H. grant only at age 45.

. . .

We need to ensure that the brightest young doctors can contribute to further advancements in their field, or we risk stalling the engine that consistently delivers better medicine, longer lives and a stronger economy for Americans and people around the world.

For the full commentary, see:

Mukesh K. Jain, Tadataka Yamada and Robert Lefkowitz. ” More Doctors Should Do Research.” The New York Times (Tuesday, Sept. 24, 2019): A27.

(Note: ellipses added.)

(Note: the online version of the commentary has the date Sept. 23, 2019, and has the title “We Need More Doctors Who Are Scientists.” The online version says that the commentary appeared on p. A29 of the New York print edition. The commentary appeared on p. A27 of my National print edition.)

Regulations Mandate Ineffective Dishwashers

(p. A18) The FreedomWorks regulatory policy manager, Daniel Savickas, said the Competitive Enterprise Institute had flagged the dishwasher issue and the groups had decided to combine their efforts. “We try and roll back burdensome regulations and make life easier for consumers and manufacturers,” he said.

“The dishwasher in my apartment is absolute garbage, and I have to run cycles multiple times,” Mr. Savickas said.

The crux of their argument is that energy efficiency standards have made America’s dishwashers ineffective with ever-longer cycles, to the consternation of users. “Why should the government mandate these models rather than leave the choice to consumers in the first place?” Mr. Kazman said.

For the full story, see:

Hiroko Tabuchi. “Warriors Against Environmental Rules Champion the Dishwasher.” The New York Times (Wednesday, Sept. 18, 2019): A18.

(Note: the online version of the story has the date Sept. 17, 2019, and has the title “Inside Conservative Groups’ Effort to ‘Make Dishwashers Great Again’.” The online version says that the New York print edition was on p. A17. In my National print edition, the article was on p. A18.)