New proposals from the U.S. Securities and Exchange Commission (SEC) would allow so-called “gig workers” to be partially paid in equity.
The commission voted to propose rule changes that would allow companies to pay equity compensation to “platform” workers, such as Uber drivers.
“Today’s proposed amendments seek to modernize our requirements for including company securities in worker-company compensation arrangements so that workers have the opportunity to share in the growth of the business,” said SEC chairman, Jay Clayton, in a statement.
Under the proposals, firms would be able to pay gig workers up to 15% of their annual compensation in equity, to a maximum of US$75,000 over three years.
The SEC said that the proposed rules aim to “reflect the significant evolution that has taken place in the composition and participation of the workforce” in recent years.
“Work relationships have evolved along with technology, and workers who participate in the gig economy have become increasingly important to the continued growth of the broader U.S. economy,” said Clayton.
The proposals will go out for a 60-day public comment period after being published in the Federal Register.
The SEC is proposing to adopt the measures for five years, which will allow the regulator to examine whether companies are using the provisions to pay workers rather than raise capital.
“The commission would also be able to assess whether such issuances have the expected beneficial effects for issuers in the ‘gig economy’ and their investors, including those platform workers who have received securities as compensation, and whether such issuances have resulted in any unintended consequences,” the SEC said.