Headline January 04, 2017/ ''' EMPLOYMENT & *EMPLOYEES* '''

''' EMPLOYMENT & *EMPLOYEES* '''

MULTI-BILLIONAIRE FARAZ  -at the hosts Pakistan-   could just so easily make it, as one of  country's richest lads. No matter, what the measure. 

He just about shares and participates, in every economic pie. And then To top it all, - and the reason he makes it to the Headline Post on !WOW!,  is the sterling fact that the Good Lord, in his infinite mercy and wisdom, could not have blessed a finer human with such riches.

Faraz and his associates, over these many years, have given away over 37 fully paid scholarships to students of Pakistan. The details of these scholarships will soon be published in  Sam Daily Times.

But the introduction doesn't end here. When I meet him next, I am going to reason and  persuade him for ever more scholarships and also for some international ones for the Students of  Chad, Somalia, Afghanistan, Siri Lanka and Bangladesh. So, standby. 

WHAT IS AN EMPLOYEE?  Since  last year judges in several American courts are grappling with  this very profound question.

Most notably, some drivers for  Uber,  -at the time-  an app-based taxi service, went on to sue to have themselves declared employees, rather than independent contractors, in a bid to gain more rights.

With  technology making  it  ever easier to farm out small tasks, and freelancing on the rise, the traditional definition of employment may eventually break down. 

Yet the importance of the  ''employee''  label  -and the benefits that come with it   is very often overstated.

Historically, the challenge for economists has been to explain employment rather than contracting  

Firms with employees use  plans and hierarchies  to get things done.; those who use contractors rely on markets and prices instead.

In 1937, Ronald Coase, an economist, argued that this comes down to transaction costs. For instance, it is difficult to contract on output when it is tough to judge quality  [as with say a spreadsheet].

When transaction costs  are high, it may be better to replace contractors with employees, who are paid for their input rather than outputs.

A corollary to Coase's theory is that when transaction costs are low, there is no need for a firm.

Industries in which tasks can be neatly divided and when output is easily tracked, such as building, haulage and logging, contractors have been prevalent for decades.

In 2009,  the year Uber was founded,  88%  of taxi drivers were already contractors.

Contracting then, is not new. But campaigners for workers' rights worry about the use of contractors in the rapidly growing app economy. Often, governments and companies provide benefits exclusively to employees. Are contractors missing out?

In the  Developed World The main benefits associated with employment fall into three  broad categories:

.- public pensions

.- health care

.- unemployment insurance.

In the case of pensions, governments usually levy payroll taxes on firms in proportion to their workforce, and use the proceeds to support pensioners.

Hire a worker as a contractor, and firms need not pay the levy; in America the  self-employed must instead pay it  themselves . Workers' advocate claim this means contractor face higher face higher tax rates than employees.

However, conventional economics say the burden of tax cannot be altered to just by changing which party writes the cheque. 

America's Congressional Budget Office considers payroll taxes part of a worker's tax burden, even though employers pay them.

Were Uber forced to play  social-security contributions instead of its drivers, it would presumably offset the extra cost by reducing the  share of each fare that goes to the driver. 

Their take home pay would remain the same. This argument cuts both ways:

If it does not matter who pays, firms may as well cough up {though businesses may legitimately  worry about the associated administrative costs of paying contributions}.

Then there is health care, which is often tied to jobs in America. Again there is no free lunch for workers when employers foot the bill.

Numerous studies have found that the more firms pay for the health insurance, the less they pay in wages.

For instance, in 1994  Jonathan Gruber of  MIT   found that when some states began insisting on better coverage for childbirth, married 20 to 40 year old women-

Whose insurance costs rose most on average   -took an offsetting hit to their pay.

The Honour and Serving of the latest  *Operational Research* on Freelancers and Jobs continues. Thank Ya all for reading and sharing forward and see you on the following one.

With respectful dedication to the Business Leaders, Students, Professors and Teachers of the World. See Ya all on !WOW!   -the World Students Society and Twitter-!E-WOW!  -the Ecosystem 2011:

''' Right On Target '''

Good Night and God Bless

SAM Daily Times - the Voice of the Voiceless