The rise of the gig economy: Employers and jobseekers call for more workers’ rights
A recent totaljobs study has revealed that employers and jobseekers are united in calling for greater protection to be given to those who work in the gig economy.
The study of nearly 5,000 jobseekers and over 100 employers has revealed that 90% of employers and jobseekers believe that more regulations are needed to protect the rights of gig workers. This comes as the shift towards flexible working continues to rise, as more people – particularly those currently out of work – are considering contracts, freelance working and ‘gigs’ as an attractive option.
The gig economy includes freelance, contract and ad-hoc work which is often classed as self-employed and means contractors don’t have the same rights as employees. So while the mind immediately conjures images of delivered pizzas and handy lifts home, the gig economy stretches much further than this, incorporating contractors in accountancy, technology and virtually every other industry.
So what’s the debate?
Supporters claim that the gig economy offers workers the joy of flexibility and the ability to control their own working hours in order to prioritise other aspects such as a passion, study or family ties.
The debate arises, as this very same flexibility means that businesses are not beholden to offering statutory rights such as minimum wage, redundancy pay, holiday pay, sick pay or company pensions.
Therein lies the problem, as many people believe this flexibility is soon blurred with exploitation
And why do people work in the gig economy?
Interestingly, nearly 43% of employers told us that they already hire gig workers, while nearly half of those who don’t told us that they expect they will in the future.
35% of gig workers told us that they work this way because of the greater flexibility it offers compared to traditional nine-to-five roles, while 32% said it’s because they couldn’t find full or part-time work, and one in five (22%) said it was to get experience in a different industry.
There are benefits for businesses too. 79% of employers said they employed gig economy workers to offer flexibility to their business, wherein they only pay for the work done, meaning they can scale-down operations should the need arise. 40% said it’s to fill a gap in the team, and over a third (35%) said it’s to help them scale their operations up and down.
The call for protection
The gig economy has been on the rise for several years and nearly two-thirds of employers believe its importance will only continue to grow in the next year, as individuals turn to self-employment in favour of more flexible working arrangements. This forecast is backed up by an annual 24% increase in the number of contract and freelance roles advertised on totaljobs, and a 36% rise in candidate applications.
As demand, and supply for gig economy work accelerates the Taylor Review of Modern Working Practices has recommended greater protection for workers.
The Taylor Review called for gig economy workers to be classified as dependent contractors, as the government project outlined that these workers are “not an employee, but neither are they genuinely self-employed.” The recommendations from the report suggest that while they may not be permanent employees, they should be eligible for more rights and benefits from their hiring company.
In doing so, Taylor disparaged the gig economy for breeding “one-sided flexibility” where “employers seek to transfer all risk onto the shoulder of workers in ways that make people more insecure and makes their lives harder to manage. It’s the people told to be ready for work or travelling to work, only to be told none is available.”
Interestingly though, The Labour Party’s shadow business secretary Rebecca Long-Bailey has criticised the Taylor Review for not being bold enough in looking to help the 4.5 million people working within the gig economy. She told the BBC: “If it looks like a job or it smells like a job then it is a job, and the worker should be employed, and I think in those situations where a worker is carrying out work on behalf of an employer… they should not be exploited as a flexible workers.”
So what next?
Alongside an agreement on all sides that legislation needs to be implemented to protect gig economy workers, the Office for Budget Responsibility (OBR) has estimated that by 2020-21 unpaid taxes from the gig economy will come at a cost to the Treasury of £3.5bn.
Surely, with these factors in play, greater protection, rights and legislation is only a matter of time?
Do you employ workers as part of the gig economy? Leave your thoughts below.