Gig working is the new buzz word in employment circles. It allows you to work (gigs) when and where you want without the obligations that come with normal employment.
Here we look at what a gig worker is, why it’s a good opportunity for some people, and some of the pitfalls due to lack of employment regulation.
WHAT IS A GIG WORKER
Formerly used to refer to engagements for musicians, the term “gig” is a word that traditionally describes a job that is a one-time engagement that lasts for a specified period of time.
Examples of gig workers include:
- Food delivery services such as DoorDash and MenuLog
- Ride shares such as Uber
- Professional services for a fee (i.e. freelance professionals)
Unlike employees who are obliged to work set hours, may have to wear a uniform and are unable to subcontract their labour, a gig worker has none of those obligations. And if they are subject to any of the above, they are technically employees rather than gig workers.
BENEFITS OF GIG WORKING
Like other industry disruptors, there are benefits for both business and workers.
The benefits for business include:
- Cheap work force – Gig workers are only paid by the job and are not subject to minimum wage and overtime.
- No benefits to pay – Gig workers do not receive benefits, workers compensation, or paid time off such as holiday or sick pay when they are unable to work.
- No safety liability – Gig workers may be exposed to risks such as traffic accidents or assaults, but the company has no responsibility towards them for compensation or providing a safe workplace.
- Ability to access specialist knowledge – Companies can tap into expertise on a one- time, on-demand basis, without having to employ a full time expert.
- Scalability – Companies who use gig workers have the ability to scale their business up or down as it expands or contracts without the need to pay redundancy payments.
The benefits for the individual include:
- Flexibility – Gig workers can usually work when and where they want and name their own hours.
- Extra income – Gig workers can supplement the income from their existing job by working at times that are convenient for them. This can also be a source of income during periods of unemployment.
- Greater control – A good work life balance is highly sought after by all employees, but gig workers are actually able to control work/home life ratio more effectively because they choose their own hours.
PROBLEMS OF GIG WORKING
Despite the obvious benefits to the individual, gig work also comes with its own inherent problems. These include:
No job security
Sally does gigs for a food delivery service and the owner decides he’d rather have only male drivers. Sally is dismissed without notice and has no recourse to discrimination or unfair dismissal laws because she is an ‘independent contractor’.
No health and safety protections
Sally is sideswiped by a car while delivering food and suffers injuries resulting in time off work. The company she gigs for has no obligations with regards to workers compensation.
No work benefits
Sally takes a short break from her food delivery gig but she must fund her break entirely herself because the company has no obligation to pay during break periods.
No legal protection against workplace misconduct
Sally receives unwanted attention from one of the other delivery drivers, but she is unable to make a formal complaint of sexual harassment as the company she gigs for has no liability towards independent contractors. Instead she is required to submit a personal police report and be responsible for court fees if there is evidence to substantiate her claim.
No minimum wage
Sally generally receives only an amount for each delivery she makes, not a minimum wage salary, and the company takes its cut from that as well.
No overtime or penalty rates
Sally is often asked to work on Sundays. She agrees because she needs the money, but she is not eligible for overtime or penalty rates.
MOVE FOR CHANGE
While there is a move to regulate gig employment, one of the main obstacles is defining exactly what a gig worker is. One definition is how financially dependent they are on the employer (i.e. how much they earn and how long that work continues).
Gig salary culture around the world
In Australia, the federal government is looking at introducing a new category to try and regulate the gig economy, but this has been criticised due to it’s failure to address the current gig situation. In Queensland in particular, they are introducing new laws relating to gig workers that give them minimum entitlements and conditions such as minimum wage, some paid leave and remedies for unfair dismissal.
Pressure from unions is also starting to have an impact, with industry disruptors such as Uber and DoorDash agreeing to minimum wages and conditions for their delivery drivers.
In the US, change is much slower – the tip-reliant culture means there are little to no state regulations that advocate for the minimum salary wages and a business’ obligations to fair recompense for employees, let alone gig workers.
In the UK, according to a study by the University of Bristol, 52% of gig economy workers surveyed are earning less than the minimum wage, and more than 75% experience work-related anxiety and insecurity.
Whilst change is coming, it’s still slow and in the meantime gig workers continue to endure low wages, unfavourable working conditions and lack of basic employment entitlements. If reform means we have to pay a couple of dollars more for our takeaways, surely that’s worth it to avoid a lower economic class of workers becoming the norm.
