Corporations aren’t people, but people and corporations do share some characteristics. Whether you’re a human being or an immortal sinister colony organism that uses humans as gut flora (e.g. a corporation), most of us need to pay the rent and cover our other expenses.

“Earning a living” is a fact of life for humans and for corporations, and in both cases, the failure to do so can have dire consequences. For most humans, the path to earning a living is in selling your labor: that is, by finding a job, probably with a corporation. In taking that job, you assume some risk — for example, that your boss might be a jerk who makes your life a living hell, or that the company will go bust and leave you scrambling to make rent.

The corporation takes a risk, too: you might be an ineffectual or even counterproductive employee who fails to work its capital to produce a surplus from which a profit can be extracted. You might also fail to show up for work, or come in late, and lower the productivity of the firm (say, because another worker will have to cover for you and fall behind on their own work). You could even quit your job.

Both workers and corporations seek to “de-risk” their position. Workers can vote for politicians who will set minimum wages, punish unsafe working conditions and on-the-job harassment, and require health and disability insurance. They can also unionize and get some or all of these measures through collective bargaining (they might even get more protections, such as workplace tribunals to protect them from jobsite harassment). These are all examples of measures that shift risk from workers to capital. If a boss hires or promotes an abusive manager or cuts corners on shop-floor safety, the company — not the workers — will ultimately have to pay the price for its managers’ poor judgment.

Bosses also strive to de-risk their position, by shifting the risk onto workers. For example, bosses love noncompete clauses in contracts, which let them harness the power of the government to punish workers their workers for changing jobs, and other bosses for hiring them. Given a tight noncompete, a boss can impose such high costs on workers who quit that they will elect to stay, even in the face of degraded working conditions, inadequate pay, and abusive management:

https://pluralistic.net/2022/02/02/its-the-economy-stupid/#neofeudal

If you have $250,000 worth of student debt and your boss has coerced you into signing a contract with a noncompete, that means that quitting your job will see you excluded for three years (or longer) from the field you paid all that money to get a degree in, but you will still be expected to pay your loans over that period. Missing the loan payments means sky-high penalties, which is how you get situations where you borrow $79k, pay back $190k, and still owe $236k:

https://pluralistic.net/2020/12/04/kawaski-trawick/#strike-debt

Bosses can also coerce workers into signing contracts with “training repayment agreement provisions” (TRAPs), which force workers to pay thousands of dollars for the privilege of quitting their job. Put this in stark economic terms: if your boss can fine you $5,000 for quitting your job, he can impose $4,999 worth of risk on you without risking your departure:

https://pluralistic.net/2022/08/04/its-a-trap/#a-little-on-the-nose

Bosses also enter into illegal, secret “no poach” agreements whereby they all agree not to hire one another’s workers. One particularly pernicious version of this is the “bondage fee,” where a staffing agency will demand that all its clients agree never to hire one of its contractors. In NYC, the majority of “doorman buildings” use a staffing agency called Planned Companies, a subsidiary of Toronto-based Firstservice, whose standard contract contains a bondage fee provision. The upshot is that pretty much every doorman building is legally on the hook for huge cash fines if they hire pretty much anyone who has worked as a doorman anywhere in the city:

https://pluralistic.net/2023/04/21/bondage-fees/#doorman-building

Again, this is a form of de-risking for capital. By creating barriers to workers quitting their jobs, bosses can reduce the risk that their workers will quit, even if the pay and working conditions are inadequate.

One of the most profound, effective and pervasive sites of de-risking is the gig economy, in which workers are not guaranteed any wages. By paying workers on a piecework basis — where you are only paid if a customer appears and consumes some of your labor — bosses can shift the risks associated with bad marketing, bad planning, and bad pricing onto their workers.

Think of an Uber driver: when an Uber driver clocks into the app, they make the whole system more valuable. Each additional Uber driver on the road shortens the average wait time for a taxi. What’s more, Uber’s algorithmic wage discrimination allows the company to pay lower wages when there are more workers available:

https://pluralistic.net/2023/04/12/algorithmic-wage-discrimination/#fishers-of-men

Lots of companies have hit on the strategy of increasing staffing levels in order to increase customer satisfaction. If you’re a hardcore frequent flier, your chosen airline will give you a special number you can call to speak to a human in a matter of seconds, without ever being shunted to a chatbot. This is a gigantic perk — especially if you’re flying at a time when air traffic controllers are quitting in droves because they haven’t been paid in a month, and thousands of flights are being canceled, leaving travelers scrambling to get rebooked:

https://www.thedailybeast.com/air-traffic-controllers-start-resigning-as-shutdown-bites/

The airline that creates the secret, heavily staffed call center for its biggest customers is making a bet that those customers will spend enough money with the airline to cover the wage of those call-center employees. If the company bets wrong, it pays the penalty, taking a net loss on the call center.

But what if the airline could switch to a “gig economy” call center like Arise, a pyramid scheme that ropes in primarily Black women who have to pay for the privilege of answering phones, and pay for the privilege of quitting, but who can be fired at any time?

https://pluralistic.net/2020/10/02/chickenized-by-arise/#arise

Well, in that case the airline could tap an effectively limitless pool of call-center workers who could keep its best customers happy, but without taking the risk that the wages for those workers will exceed the new business brought in by those frequent fliers. Instead, that risk is borne by the workers, who have to pay for their own training, and whose pay can be doled out on a piecework basis, only paying them when someone calls in, but not paying them to simply be available in case someone calls in.

This isn’t merely an employer de-risking its position: rather, the company is shifting its risk onto its workers. By deploying the legal fiction of worker misclassification in which an employee is classed as an “independent contractor,” the boss can shift all the risk of misallocating labor onto workers.

In other words, risk-shifting isn’t eliminating risk, it’s just moving it around. Remember: both the corporation and the humans who work for it have to earn a living. They both need money for rent and other bills, and they both face dire consequences if they fail to pay those bills. When your boss misclassifies you as a contractor and only pays you when there’s a customer demanding your labor, the boss is shifting the risk that they won’t be able to pay the rent (because they hired too many workers or marketed their product badly) to you. If your boss screws up, they can still pay the rent — because you won’t be able to pay yours.

That’s what bosses mean by a “flexible workforce”: a workforce that can coerced into assuming risk that properly belongs to its employers. After all, if you get into your car and clock onto the Uber app and fail to get a fare, whose fault is that? Uber bosses have all kinds of levers they can pull to increase ridership: they can reduce fares, they can advertise, they can even ping Uber riders directly through the app. What can an Uber driver do to increase the likelihood that they will get a fare? Absolutely, positively nothing. But who assumes the risk if a driver cruises the streets for hours, burning gas, not earning elsewhere, and not making a dime? The driver.

Uber alone determines the conditions for drivers, including how many drivers they will allow to be on the streets at the same time. Uber alone has the aggregated statistics with which to estimate likely ridership. Uber alone has the ability to entice more riders to hail cars. And yet it is Uber drivers who bear the responsibility if Uber fucks any of this up, and Uber does fuck this up, so badly that the true average driver wage (that is, the wage for hours in the car, not just when there’s a passenger in there with you) is $2.50/hour:

https://pluralistic.net/2024/02/29/geometry-hates-uber/#toronto-the-gullible

This is what it means to shift risk. Uber doesn’t have to be disciplined about its fares or its staffing levels or its marketing, because its workers can be made to pay the penalties for its mistakes. It’s like this throughout the gig economy: the rise and rise of a massive “flexible workforce” is actually the rise and rise of a system in which labor assumes capital’s risk.

Capital’s story about a “flexible workforce” is that the risk is somehow magicked away when you can reclassify a worker as a contractor, but that’s not true. A business that can only secure its sustained operations by shifting risk to its workers is a corporation that only exists because the workers who produce its profits assume the risks for its managers’ blunders.