The Gig Economy - Modern Business or Exploitation | Eden Scott

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The Gig Economy - Modern Business or Exploitation

22 Jun 2017
Paul Buchan

The Gig Economy – Is it Wrong?

Many of us in the recruitment industry have been watching the latest developments in relation to the “gig economy” with great interest as it adds to an ever-changing landscape in both workers’ rights and employer responsibilities.

There a number of court cases that have been brought in the last year or so, none more high profile than that of Uber, which indicate there is something of a grey area in this working practice.

The Gig Economy – What Is It?

The period from 2007-17 has been a fascinating one in the UK’s economic history driven as much by necessity as it has been free-market principles. The emergence of zero-hours contracts and ‘Uberisation of the workforce’ over the last decade has resulted in a rush to condemn modern employment practices by many politician and the development of unions amongst the independent workers to cut back on exploitation. Many have characterised the approach of companies as evil and in some instances it is very difficult to mount a credible case for the defence.

However, as with any and all aspects of the modern economy the truth is probably somewhere in between.

The Oxford English dictionary describes the Gig Economy as,

“A way of working that is based on people having temporary jobs or doing separate pieces of work, each paid separately, rather than working for an employer”

It does seem that flexibility from both sides is vital. For the survival and growth of small companies on one side to those people at a certain stage of their lives where it suits them to work on their terms and earn the money that their lifestyle can support.

However, as with everything while there are positives to this approach they are always open to abuse and certain companies could be seen as taking advantage for economic gain.

The Gig Economy – What’s going wrong?

It was summed up rather well I thought by Sarah O’Connor in the FT last year in her piece “When your boss is an algorithm”. She describes a ‘strange clash’ by a bunch of young men who were outside Ubereats. They were’

“…workers without a workplace, striking against a company that does not employ them. They are managed not by people but by an algorithm that communicates with them via their smartphones. And what they are rebelling against is an app update.

All in all it is a very strange situation but one that is certainly creating some ripples. In my role as a recruitment consultant I need to tread a fine line between being openly critical about organisations but also of having the courage of my convictions to highlight unedifying tactics and it does seem that some organisations are abusing these employment mechanisms as a way to circumnavigate workers’ rights. With a good internet service provider and a basic grasp of research you will be able to find these instances quicker than you can say “Google”.

There are quite a number of large-corporate businesses (who shall remain nameless) who have record breaking levels of turnover and profitability who are using these employment types to mitigate and dilute their basic fiduciary responsibilities as employers. But this does not mean we should eradicate this type of employment, as I mentioned, the answer lies in finding some sort of happy medium.

Tech Start-Up vs Multi-National

For every tech start-up on a shoestring fighting for survival that cares about their staff there is a behemoth who may seem less focused on their workers wellbeing. But that neatly encapsulates the controversy surrounding these methods of engaging staff.

On the one-hand this type of “casual” employment is to help employers at one end of the scale to be fearless in achieving growth and on the other it helps large conglomerates to treat people like A.N.Other. The legalities, morals and reasoning behind these working practices are open to debate but what is not in question is that what was initially conceived of as a method to promote growth at a difficult time in our economy has actually been used by some organisations to negate their basic responsibilities towards people.

This is something that a fairly basic legislative programme should be able to tackle however the appetite to do so may be limited at the moment given the size of the fish currently being fried in Westminster. What is for certain is that something will need to be done to tackle these injustices in this cycle of government, it should be fairly simple to garner cross-party support for measures that improve the rights of workers in the UK? Possibly not…..

In any-case, I am not entirely against the “gig-economy”, flexible working or (dare I say it) “zero-hours” contracts for I have seen throughout my career the difficulty that some companies can experience when growing as an organisation.

In recent years AWR, IR35, auto-enrolment and other burdensome laws have been enacted that have eroded profitability, affected growth and (in some cases) led to the closure of viable business. So for the small business owner it can be a case of “damned if you do, damned if you don’t” but what is clear is that we need to offer businesses incentives to grow that also meet the challenging financial needs of individuals.

Whether you are a millennial, baby-boomer or Gen X citizen it is fair to say that expectation levels are sky-high in the modern world. Not only do we expect good holiday entitlement’s, bonuses and other benefits from work; we are also living in a world where it is perfectly reasonable to walk into a supermarket and walk away (having paid!) with everything ranging from a mobile phone contract to a sink plunger. And with these expectations comes a price and therefore a cost.

Conclusion

For the lowest paid and most vulnerable in our society we need laws that protect them but we also need laws that enable small businesses to grow. Without small businesses we have no economy, it is vital to support them but it is equally important to be a just and fair society, after all, this is what we expect.

Author

Paul Buchan
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