If one company caught the zeitgeist in 2015 then it’s probably Uber, the app powered taxi-booking firm. It has become the leitmotif of the so-called gig-economy, attracting enormous coverage and consumer popularity, alongside a fair amount of hostility. A key source of tension concerns its relationship with its drivers: are they right to be treated as so-called ‘partners’, effectively self-employed contractors, or are they actually more like employees with workplace rights?

Get ready to hear a lot about this in 2016. Lawyers in different countries are busy working on it and the outcome will not just affect Uber, it could shape the whole future of the on-demand economy.

A recent ruling in California has already determined that an Uber driver should be viewed as an employee and now a far wider class action is proceeding. In the UK the GMB union is bringing a similar case on behalf of drivers arguing they are misclassified as self-employed and thereby denied rights such as the minimum wage, paid leave and rest breaks. Their lawyer, Nigel Mackay, explained his view to me that Uber is effectively an ‘employer’ controlling hiring, firing and paying drivers as well as shaping key elements of their work like charging and routing. Other recent cases finding that workers in other industries have been wrongly classified as self-employed contractors reinforces Mr Mackay’s confidence that the drivers will prevail.

Whichever way the judgement goes, there is an underlying question as to whether flexible ‘gig’ forms of work fit neatly into traditional categories of employment law. Some maintain that our existing framework remains fit for purpose: strip away the gee-wizzery of online apps and the essential legal issues that determine whether someone should be treated as an employee or a freelancer are unchanged. Others disagree, arguing that technology platforms are enabling workers and consumers to come together in radically new ways, often across borders, and in doing so altering the character of the employment relationship and challenging our policy and legal framework: 21st century technology is racing ahead of 20th century institutions.

That’s exactly the debate that has just ignited in the US. One spark was a call last month from a powerful coalition of progressive tech leaders (including those from Uber rivals Lyft), unions and philanthropists calling for the creation of a new and flexible system of worker protection based on portable benefits. Then just last night there was a landmark vote by Seattle City Council to pass a bill permitting independent contractors to join a union. It is the first US city ever to do this — and the same city, recall, that was a first-mover in the ‘fight for $15’ which is now spreading across urban America. It is a highly contentious move that will be battled over in the courts by the likes of Uber and Lyft who will argue that it conflicts with federal anti-trust law.

All this comes alongside a heavily publicised proposal for the creation of a new system of worker protection for the gig economy by two Democrat heavy-hitters — Professor Alan Krueger, former Chair of the White House’s Council of Economic Advisors, and Seth Harris, former Labor Secretary. It argues a hybrid category of ‘independent worker’ is needed to accommodate situations where an ‘employer’ exerts control over much of what a worker does at the same time as the worker retains the right (like the self-employed) to work as much or as little as they want, when they want.

The report’s conclusion is that a raft of legal rights should be extended to the on-demand workforce including: compulsory employer contributions for health insurance, the right to organise a union, application of anti-discrimination laws and tax-withholding services. Controversially, however, it also argues that — as with the self-employed — the minimum wage should be waived on the basis that the nature of the work undertaken makes it very hard, or impossible, to reliably measure hours undertaken.

Whatever your take on the exact proposal, the underlying objective — ensuring that any gains to society arising from gig type activity reflect genuine innovation and service improvement rather than regulatory arbitrage at the expense of workers — is surely the right one.

The US debate doesn’t, of course, translate into the UK’s very different legal and welfare system — for instance, we already have an intermediate status for so-called ‘workers’ falling between that of employees and the self-employed, though whether it any better suits the realities of gig type working is unclear.

For now we remain in legal limbo as we wait to find out whether Uber will itself face its own great ‘disruption’ (to use their favoured phrase) in the form of a verdict forcing it to comply with UK workplace rights. Paying the minimum wage in full, together with becoming liable for employer’s NICs, pension contributions, and other employer responsibilities, would severely challenge the business model of many nascent on-demand enterprises.

All of which means we suggests that, like the US, we should be thrashing these issues out. Might it be possible to craft forms of protection that give greater security to so-called gig workers without destroying innovative and popular features of these new business models? Or would any gains to those potentially misclassified as self-employed be outweighed by the risk that larger numbers of other workers, in traditional sectors, get shunted into a new, less protected employment status? Ill-judged reform could mean more levelling down than up.

Today the gig economy is smaller than the hype would suggest. It remains in its infancy. But as it matures out of its noisy, insurgent phase it needs to find a better accommodation with the workforce that powers it. Right now, the focus is on an established union seeking to enforce traditional employment law. In time, new forms of protection and worker organisation may be needed. Just as business faces an imperative to innovate, so too do those who believe in social protection.

Gavin Kelly is CEO of the Resolution Foundation. This article was originally published on his blog which is available at www.gavinkellyblog.com