Governments Reacting to the Failures of the Gig Economy

economic chart

According to economists the economy is the labour market is fine as unemployment is relatively low. The truth is different from the on-paper measurements. High employment numbers don’t mean much if the jobs don’t pay well and the working conditions are miserable. The modern “gig economy” is to blame for this counterintuitive economic situation. Governments are starting to catch on that these “modern” jobs aren’t nearly as beneficial to workers or the economy as more traditional jobs were. As a result new laws are being passed to prevent workers from being exploited by the likes of Uber and other gig economy giants.

AB 5’s reclassification provision would also allow gig workers to unionize, granting them a modicum of protection. Big Tech greeted previous unionization efforts with outright hostility. In November, Google publicly fired five engineers involved in union activity. Other companies, like Uber, use antitrust law to bar drivers from collective action to address their concerns.

A more radical approach would be to break up the Big Tech monopolies that have such a tight grip on California and its economy, making it more difficult for these companies to dictate the terms of employment. Presidential candidates such as Bernie Sanders and Elizabeth Warren have vowed to dismantle giants like Facebook and Google if elected. Sanders’s plan, arguably the most ambitious, would order companies to offer workers more benefits and higher wages and pensions. Workers would also need to make up at least 45 percent of companies’ board memberships, ensuring that they would have a seat at the table when executives make decisions that affect their livelihood.

Read more.

It’s Time the Gig Economy Paid

Foodora work

Foodora workers are looking for justice for the way they have been ripped off and poorly treated by Foodora. Foodora is like any other gig economy company insofar that it takes an existing business model but places the operating costs onto independent contractors. Due to legal loopholes Foodora workers are easier to exploit and get less protection than workers labelled as employees – and this issue isn’t unique to Foodora. Most gig economy “jobs” are questionable.

In the USA, Trump’s anti-labour government has failed to protect workers so individual states are starting to act. California is looking at legislation to protect people who work in the gig economy.

Last Wednesday, the California assembly passed legislation codifying an important California supreme court decision: in order for companies to treat workers as independent contractors, the workers must be free from company control, doing work that’s not central to the company’s business, and have an independent business in that trade.

Whatever national rule eventually emerges for defining gig workers, they’ll need a different system of social insurance than was the case when steady full-time employment was the norm.

For example, they need income insurance rather than unemployment insurance. One model: If someone’s monthly income dips below their average monthly income from all jobs over the preceding five years, they automatically receive half the difference for up to a year.

Read more.

Scroll To Top
%d bloggers like this: