Gig economy? Unknowingly we're all slipping into a new wave job market

There have been problems emerging from the emerging nature of workforce of the gig economy crying for solution

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Some highly populated cities of India, especially Kolkata, Chennai and Bangalore have made headlines recently with the food delivery aggregators such as Swiggy and Zomato slashing the pay to delivery boys drastically by half.

The newly emerging workforce is changing the contours of employment rules, per se, as they are no longer offered jobs as workers but as partners in service or business, but get paid relatively less. American futurologist Alvin Toffler had hinted at the emerging trend when the digital revolution was at the corner during turn of the last century, tracing consumers as emerging prosumers, or those who do half the job themselves before the company takes up work using its staff.

Alvin Toffler's prosumers?

Toffler had missed the gig economy's emergence but it was there for the current generation to see and be active partners in it. Essentially, the old economy's jobs have replaced with the new delivery partners, thus flooding the roads of many cities with bike-borne boys carrying food and grocery packages all over the cities. And they're now getting heavy price cuts in their remuneration with no trade unions around to voice their grievances.

With the rise of millions of these 'gig' workers, mainly from the delivery businesses, investors have used digital platforms to spread across the world like Uber, Zomato, Deliveroo among others. This has brought in challenges to the nature of labour itself that would have escaped many economists.

What's 'Gig' economy?

Gig economy, involving the use of temporary or freelance workers on perform jobs typically in the service sector, has gained currency after the e-commerce boom. However, gigs have always been a part of our daily life across the world in the past too in the form of a paper boy or the milkman, but it went unnoticed until now.

The new-age workers are not traditional workers and do not have a classical employer-employee relationship like the traditional ones that got crystallized after rigorous movements like the International workers day to obtain basic security for workers. However, the gig aggregators argue that there is flexibility of work and no compulsions with catchy slogans like 'Ride to your dreams'.

Ride to your dreams

However, Ravi Kumar, (name changed) a delivery partner with Zomato, explains it candidly: "I want work, flexibility is not my concern, I want to feed my family. To gain a reasonable incentive I have to work for at least 16 hours. Only the slogans are nice, but the working conditions force us to take up more deliveries for better incentives."

The gig workers are not technically 'workers', hence, redefining the entire labour concept in a new model of work and reward bereft of job security. There have been attempts to take this narrative further to the ground level.

food delivery
Food Delivery Partner Pexels

It started with Spain (Madrid) Court in a July 2019 ruling stated that food delivery workforce are employees, not freelancers. Later, California Assembly Bill 5 (AB5), which extended 'employee' status to gig workers. The California Supreme Court ruled that companies must perform the 'ABC' test prescribed by the bill to classify a person as a gig worker.

It further stated that a person hired by an entity is not a gig worker if the person works without the control of the company, the person performs work that is outside the usual course of the hiring entity's business and if the person is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed. This ruling defined the contours of a gig worker, but we need to accept and redefine a worker encompassing gigs too.

The app has become a trap

A report in January from doteveryone, a tech think tank, says for those who don't have financial security, "The app has become a trap," adding that gig workers have no option but to work gigs, and no way out once they've begun. Gig workers 'don't know what comes next' as the always-on, piecemeal work they do makes it impossible to think or plan for a different future, the report added. It has recommended steps for financial security, platforms alteration for transparent data on earning fluctuations and the part of share that goes to the platform and worker.

An insurance platform startup 'Collective Benefits' wants to provide basic benefits to the workers in the Gig market such as family leave and sick pay, and critical injury pay. They aim to provide the same benefits and protections to gig workers as normal employees. The UK-based startup announced on Tuesday, Feb 25 that they raised £3.3 million to undertake the feat they hope to accomplish.

The workers are sad despite all these efforts, and worldwide protests have been ongoing as the problems faced by the workers have not been addressed comprehensively by the companies. About 56% of gig workers in North America felt the need to unionize to improve conditions, according to a report from Ceridian in January.

Alarming rise in gig workers

In India food delivery partners protested against fierce working conditions in 2019 in view of 16-hour work to deliver food and necessary incentives from delivery apps, and some unions also have been formed which led for the provincial Karnataka government to step in to ensure rights.

About 20-30 percent workforce of the developed countries are currently engaged in independent work, according to a McKinsey report. Gig workers would comprise as much as half the workforce by 2020, and as much as 80% by 2030, according to Peter Miscovich, Managing Director, Strategy + Innovation, JLL Consulting in New York.

High unemployment rate across the world leads people to take up any jobs that somehow help to feed them. This opportunity is capitalized by the investors to open more gig economy jobs. But everytime an economic crisis looms large, the common man tries to save more while the investor spends less. Gig economy, thus, would rise in the face of a mounting crisis highlighting the problem of security and labour rights. Solutions are the need of the hour.

This article was first published on February 26, 2020