AOL not alone in volunteer controversy
The class-action suit filed against America Online has brought to light an issue that faces a number of community sites: the legality of using volunteer workers to manage Web sites.
AOL is not the only company that employs volunteers, so it is not alone in the new spotlight being focused on this practice. Other community sites, such as Tripod, GeoCities, and iVillage, depend on volunteers to perform an array of duties such as patrolling chat rooms and bulletin boards or helping users navigate a site.
Although the practice of using volunteers has become somewhat commonplace, the Labor Department investigation of AOL and the class-action suit have raised concerns among other companies that rely on volunteers about how their businesses might be affected by a widespread backlash.
"GeoCities does not believe that any of its practices in connection with the use of volunteers in its business is in violation of any labor laws; however, to the extent that the Department of Labor makes an adverse determination in the AOL matter, it could materially and adversely affect the combined company's business and financial results," GeoCities said in a recent filing with the Securities and Exchange Commission.
A deal in which GeoCities will be acquired by Yahoo is expected to close tomorrow.
"Certainly under federal law and under the law in several states, individuals cannot volunteer for other than humanitarian or public service-oriented purposes," said Karen Kubin, a partner with law firm Cooley Godward who specializes in employment and trade secret litigation.
"The laws are meant to protect employees from being replaced by volunteers" such as people wanting to get a foot in the door in a given company, she added, noting that the question the court will be asking is, "In the absence of volunteers, would there be a workforce employed to [perform the volunteers' tasks] on a paid basis?"
Labor attorney Victor Van Bourg added that volunteers "are employees of the companies, and they should be paid," he said.
In AOL's case, these volunteers, called "community leaders," patrol the online service to uphold its terms of service agreement and provide online help to its members. AOL in return gives community leaders free access to its services as well as access to areas forbidden to members.
Kubin noted that the free services and access the volunteers are given would not be enough if the court rules they are employees, because the value of those services is unlikely to be enough to cover federal minimum wage requirements.
Web site community volunteers perform similar duties, such as patrolling chat rooms and bulletin boards for user content deemed unacceptable by the company. Often they answer questions or help guide users around the site. In return, most companies offer incentives, such as free access or perks within their sites.
Other companies, such as GeoCities and Tripod, have attracted many users to help oversee topic-specific areas on their personal home page sites. For example, someone interested in cars could volunteer in an autos area by sending out emails outlining home page building tips or relevant Web links to other interested members.
AOL and the community sites could use the nature of the work the volunteers do as a defense, Kubin said. "The argument can be made that their work is public service-oriented," she said. "These are new waters."
But Jupiter Communications analyst Anya Sacharow said the lawsuit was uncertain because the volunteers had agreed to work without pay.
"It's like an intern suing a company for being an intern," Sacharow said.
Former AOL community leader Bob McBride pointed out that volunteers entered their agreements with the company knowing they would not be paid.
"We all understood the agreement when we accepted the position--none of us were forced into taking the positions, nor were any of us held in those positions against our will," McBride wrote in an email message to CNET News.com.
Still, according to attorney Kubin's argument, the sites may not have the right to offer the volunteer positions in the first place.
"If [the volunteers] are deemed employees, the companies have to meet federal minimum wage requirements," she said.
Some companies are approaching the labor question from a different angle, offering ways for site contributors to generate income.
About.com (formerly the Mining Company), for example, offers stock incentives and revenue sharing as a way to draw in Netizens to contribute to its site.
Scott Kurnit, chief executive of About.com, said the volunteers are required to be present in chat rooms and bulletin boards, produce a weekly newsletter, and update links in their topic areas. Kurnit said the site's top guide earned $10,000 in one month. Analysts point to About.com as an example of a strong incentive-based program to get contracted labor.
"From a legal standpoint, it's the same as if we hired someone to write code for us," Kurnit said.
Kubin said About.com "could be on stronger footing" if its workers are "truly independent contractors."