Where next for the gig economy and precarious work post COVID-19?

By Elaine Yerby and Rebecca Page- Tickell

The global pandemic exposes the inherent precarity at the heart of the gig economy for governments, organisations and individuals. But will conditions for precarious workers change post the crisis?

The COVID-19 crisis has created unprecedented global challenges that have fundamentally impacted the way in which individuals conduct and experience their daily lives. As the disruption unfolds, the World Economic Forum have identified those reliant on the gig economy for work as among the hardest hit. In our recent interdisciplinary analysis of the amorphous gig economy, precarity emerged as the central tenet for understanding the tensions created, not only for individuals but also organisational structures and welfare systems. Whilst precarious work is not a new feature of capitalist societies, it is argued neoliberalism and associated discourses of flexibility and freedoms have exacerbated the conditions of precarity we see in the gig economy and are amplified in the current crisis.

Will the current crisis propel a response from stakeholder groups (e.g. gig based work platforms, governments, individuals, trade unions etc.) to change the trajectory and precarity inherent in the gig economy? Based on the findings of our recent interdisciplinary analysis of the gig economy, any hope for improvements after COVID-19 remains unlikely without significant legislative change.

Many gig workers face little choice between protecting their health and the necessity to work

Key challenges associated with predicting the future trajectory of the gig economy, irrespective of the current crisis, is its amorphous, varied and often hidden nature. National level surveys of employment were created for traditional employment patterns and are only slowly catching up with the transglobal nature of the gig economy (Abraham, Haltiwanger, Sandusky, & Spletzer, 2017). The gig economy we see today refers to the broad trend towards the use of freelance contractors on a short-term basis, who are often connected to contractors through mobile platforms (Perry, 2020). Well recognised in industries such as food delivery and taxi transportation, gig-based work arrangements have also grown exponentially in professional areas including financial services, law and healthcare (Naghieh, 2020).

This huge diversity in the nature of gig work and those undertaking it poses another challenge for measuring and understanding the experiences of those engaged in this work (CIPD, 2017). New interfaces are also created between traditional employment practices and the gig economy, and between localities of enhanced precariousness versus flexibility and lifestyle freedoms for some.

The possibility of change is primarily led by governmental policy and new legislation

The current crisis has intensified conditions for precarity for everyone, due to the significant decline and growth in different types of gig work and the lack of legal protections afforded to those working in the gig economy (such as statutory sick pay). Many gig workers face little choice between protecting their health and the necessity to work. A small number of maturing platform companies, already conscious of their poor reputation, have been offering superficial forms of protections to public facing workers – such as glass screens and plastic gloves. Only 5 out of 120 platform companies have introduced compensation for loss of earnings during COVID-19, highlighting how gig economy companies are choosing shareholder interests over the safety of their workers (The Fairwork Foundation, 2020).

At the same time, we see a continuing discourse around the precariousness of gigging as a viable economic response for individuals and organisations and as a potential solution to the current crisis. For instance, we see resourcing strategies from supermarket chains relying even more on precarious forms of work. Before the crisis many had been proclaiming the benefits of platform-based recruitment models to meet current demands and ‘flexibility’ for individuals.

Within this neoliberal hegemony, the possibility of change is primarily led by governmental policy and new legislation. In the UK the government has taken some steps to support freelancers in the current crisis by delaying the implementation of IR35 – legislation that ensures workers (who would have been an employee if they were providing their services directly to the client) pay broadly the same tax and National Insurance contributions as employees – in the private sector.

However, as the Lords noted in a recent review of IR35 regulations, the reforms heighten precarity for individuals and reduce remittances being directed to the government. Remittances from the gig economy remaining very low reduces the available funds for national governments to spend on health and welfare spending (Roy-Mukherjee and Harrison, 2020), which become even more pertinent in the current crisis. Globally, different legislative approaches are emerging to reclassify gig workers to some extent as employees. For example, France has recently recognised Uber drivers as employees which offers them a degree of security and protection. In the UK, economic uncertainty and slow growth since the EU referendum result has meant a continued reliance on the ‘flexibility’ afforded by the gig economy and conditions of precarity to be tolerated.

Current organisational and governmental responses suggest we are unlikely to see little change from this position post-COVID-19, heightening both health and wealth precarity for a large number of workers and their families.

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