Gig economy exploitation spurs workplace reforms

Gig economy exploitation spurs workplace reforms

Gig workers have been given new protections as part of the biggest workplace rights reform in 20 years.

The official gig economy definition is ‘a labour market characterised by the prevalence of short-term contracts or freelance work, as opposed to permanent jobs’.

This is often painted as flexible, allowing the worker to choose their hours and the jobs they take. However, it also leaves ample space for exploitation, with gig workers subject to very few benefits and almost no workplace protections.

In short, workers quite literally get paid for the ‘gigs’ that they work. They do not have the right to holiday or sick pay, or minium wage.

Gig Economy Exploitation

Some of the larger companies that thrive on gig economy are Uber, Deliveroo and Addison Lee, all of which have seen legal action in regards to the treatment of workers.

A high-profile employment rights case that played out in the Court of Appeal back in February 2017 concerned Pimlico Plumbers. The plumber in question won his appeal against London’s largest independent plumbing firm, finding that he should’ve been classified as – and received the benefits of - an employee.

He was a long-serving worker, was required to wear a uniform, wasn’t permitted to work for rival plumbing firms and had his working hours and the jobs he accepted dictated to him, all of which are distinct indicators of an employer-employee relationship.

Despite many workers in the gig economy experiencing the same restrictions, the majority are currently classed as independent contractors. This means they have no protection against unfair dismissal, no right to redundancy pay, no right to national minimum wage and no holiday or sickness pay.

Yet another example is the case made by 27 National Gallery employees, some of whom had worked there for decades, after being dismissed without warning or compensation. An outcome is yet to be reached.

It’s this lack of protection that’s necessitated the reforms now taking place.

Legalisation Launch

The reforms, outlined by business secretary Greg Clark, aim to prevent the ‘unfair use’ of contractors and freelancers, as well as reinforce paid time off for seasonal and temporary workers.

The ideology behind the legislation is fully covered in a report titled ‘Good Work’, released in February of this year, which is based on recommendations by former Tony Blair adviser Matthew Taylor. These reforms came into effect today.

This new legislation rules, amongst other things, that staff now have to be told details of their rights on their first day, including whether they’ll be receiving holiday and sick pay.

Workers will also be given the power to request more predictable hours, although there’s no legal reinforcement in place to make employers adhere to such a request.

Ministers have stated that the legislation will:

  • Close a loophole that had previously allowed contractors to be paid less than permanent employees
  • Ensure firms will have to provide a ‘statement of rights’ on the first day of a person’s employment, setting out what paid leave they are entitled to, including for illness, maternity and paternity leave
  • Increase the maximum fine employers face at a tribunal from £5,000 to £20,000 if they are found to have demonstrated ‘malice, spite or gross oversight’ in their treatment of the worker
  • Ensure that companies will have to calculate holiday pay based on 52 weeks, as opposed to 12 weeks, so people in ‘seasonal or atypical roles get the paid time off they are entitled to’.

Zero Hours, Zero Change

Zero hours contracts are still yet to be comprehensively addressed by the government as a separate issue, despite the working conditions being almost as precarious as gig work.

Prevalent zero-hours employers include JD Wetherspoons, McDonald's and Sports Direct. The government has said that completely banning the contracts at this time will ‘negatively impact’ more people than it will help, voicing concerns that it will cause such employers to cut back on their sizeable yearly intake of staff.

Frances O’Grady, TUC general secretary, is disappointed that the government has missed such an opportunity to rectify the rights of zero-hour workers. She states that ‘the right to request guaranteed working hours is no right at all. Zero-hours contract workers will have no more leverage than Oliver Twist’.

The Archbishop of Canterbury, Justin Welby, also famously dubbed the controversial contracts ‘the reincarnation of an ancient evil’ while speaking at the 150th annual TUC Congress in September this year. Watch his full speech here.

It is yet to be seen if further reforms to workplace rights will take place in 2019.

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