The Gig Economy is WorkChoices by Stealth

The rapid growth of the gig economy in the past five years through businesses such as Uber and Deliveroo has raised fundamental questions about the nature of economic justice and working conditions in the 21st century. To frame these questions and contextualise the challenges, there is value in looking at them through the lens of one of the most infamous industrial relations fight in Australia in my lifetime –  the WorkChoices debate.

WorkChoices’ was the package of industrial relations reforms controversially introduced by the Howard Government in 2005. Two of the most important components of the package were the replacement of collective bargaining agreements with one-on-one individual employment agreements and the modification of the minimum legal standard that had to met for such agreements (such as in regards to penalty rates and minimum annual leave).

WorkChoices reflected the philosophical views of many on the Right. To them, collective bargaining reduced the ability of workers to negotiate agreements that were ‘flexible’ and suited their individual needs. It also reflected a conviction that labour unions stifle economic growth and reduced the potential productivity of individual workers.

The outcry from the Australian Left was immediate and emphatic. The resistance to the changes stemmed from a sense that the bargaining power of any individual worker was greater when negotiating was done collectively (ie. set by negotiation between major businesses and the labour unions responsible for the sector). Conversely, the power balance is tipped in favour of the employer if negotiation is done individually – particularly regarding workers in low-skilled jobs – because businesses could devote more resources to negotiate and, particularly in a tight labour market, offer a take-it-or-leave-it deal to prospective workers.

The opposition to WorkChioces was expressed through huge public rallies across Australia and when the Howard Government was defeated in the 2007 election, there was consensus across the political spectrum that WorkChoices had been a significant factor, leading to its ultimate demise a year later.

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The Australian Council of Trade Unions campaign ‘Your Rights at Work’ was hugely influential in the fight against the WorkChoices legislation (flickr)

Now let’s fast forward roughly a decade to the introduction of ‘gig economy’ businesses to Australia.

The gig economy has emerged from the idea that each piece of work (say, a taxi ride or food delivery) is an individual ‘gig’ which can be doled out on an individual basis to to ‘self-employed’ individuals. The growth of the leading gig economy businesses (Uber/Deliveroo/etc) has been spectacular. One in four Australians are now regular Uber rides and Deliveroo has been expanding significantly year on year.

While there are technical differences between being a low-skilled self-employed worker in the gig economy and being a low-skilled worker on a WorkChoices-style individual workplace agreement, the two modes of employment are, on a practical level, strikingly similar.

Take for example the idea that these agreements give greater flexibility to workers. This had been a major benefit to WorkChoices for the Business Council of Australia, who had previously praised WorkChoices for giving employees the flexibility to trade off or vary conditions in a way that may suit them. Similarly, gig economy businesses promote the flexibility they give their ‘employees’ (for want of better word) as a major drawcard. The ‘join us’ sections of the Deliveroo and Uber websites promote how you are “free to work to your own avaibility” and “set your own schedule” respectively. Furthermore, the business model operates on the basis that the workers are – at the outset -’cashing in’ benefits such as sick pay and annual leave for a higher upfront pay. Deliveroo, for example, notes that you can “earn up to £120 a day and Uber promotes how you can “make money on your own terms”.

These purported benefits of flexibility for the employees break down upon closer examination however. One Deliveroo rider explained the catch in conversation with The Guardian: “you can work anytime you want. But the reality is you have to do the evening shifts to make enough money to survive.” For Uber drivers, the catch that comes with the higher pay is that the driver must foot the the cost of providing one’s own vehicle, paying for the private hire insurance and accounting for the vehicle’s depreciation costs. When the hidden costs are taken into account, the actual rate per hour often drops far below the minimum wage.

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Deliveroo workers must supply their own vehicle, phone and foot the associated costs of any accidents or theft they experience (Flickr)


A common trend is that the workers earned more in the first few years of the gig economy business starting (“a year ago there were fewer drivers and a lot more work on the road… now it is much slower”). This trend is not accidental but rather the logical consequence of a business model that, in order to provide the high level of responsiveness that their customers value, necessarily flood the market with a high quantity of worker supply to guarantee an immediate response to any individual customer demand.

The concerns of being self-employed in the gig economy are, therefore, fundamentally similar to the concerns of individual workplace agreements; the sense of trying to negotiate with a powerful company without a union or under the guarantees of a government-enforced safety net. The gig economy is, in effect, WorkChoices by stealth.

The idea that an individual worker has significant bargaining power may apply where there are a limited number of skilled private contractors offering high end goods and services (such as consultancy services or plumbing) but it is unrealistic to presume that low-skilled workers have the same capacity for negotiation. Even the term ‘WorkChoices’ dovetails neatly with the premise on which the likes of Uber and Deliveroo base their appeal.

It has been therefore surprising that, considering the passionately critical response to Howard’s Workchoices in 2005, the response by Left has been relatively positive. While the gig economy in Australia has hardly been free of criticism, the overall reaction has been in no way comparable to the reaction to WorkChoices.

The clearest indication of this is the ease with which state and territory Labor Governments – which were at the forefront of the opposition to WorkChoices – are leading the way in terms of deregulating taxi industries.

There has also been a relative lack of solidarity from the broader labour movement towards these sectors when they do protest. This has been perhaps most acutely displayed recently in London where Deliveroo and UberEats workers have faced a targeted wave of theft and acid attacks by groups stealing their mopeds – thus depriving them of the means of earning an income (and for which Deliveroo has no legal obligation to compensate them for). These attacks have occurred in a highly progressive area (within Jeremy Corbyn’s seat of North Islington) and come at a time when the limitations of the gig economy have great media prominence (following a recent UK Government review on the gig economy). Hundreds of delivery drivers descended on Parliament Square to call for a crackdown on acid attacks and motorcycle theft. If there was ever a time for the Left to protest in solidarity at the injustice of their predicament, this was it. Instead, the protest was limited to the workers themselves (thus ensuring the protest was limited to a few hundred when it could have numbered in the thousands) and the opportunity to make the issue a watershed moment for the treatment of gig economy workers (or at least to demand that Deliveroo compensate those workers who need to purchase new vehicles) was missed.

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Parliament Square, London (flickr)

This is not to deny that the gig economy has been free of controversy or criticism – the founder of Uber Travis Kalanick has, after all, recently resigned after months of public outrage and the #deleteuber hashtag attracts dozens of mentions every day on Twitter. These concerns however, have related largely to issues of sexist corporate culture, sexual assaults by Uber drivers and anger over inappropriate use of surge pricing. When it comes to concerns about exploitation and worker conditions, it is largely only those directly affected (such as the taxi drivers, or the gig economy workers) that take to the streets, with limited backing from the broader labour movement (with the honourable exception of British Shadow Chancellor John McDonnell and Shadow Business Secretary Rebecca Long-Bailey).

When such a visceral example of injustice forces itself into the media and fails to attract significant support outside of the sector, it raises the question of what *would* provoke greater outrage and bring people to the streets and why the issue of worker exploitation in the gig economy does not motivate people in the same way that WorkChoices did.

The political context is undoubtedly a factor. It’s easier for the Left to know where to stand when a Conservative or Liberal Government is introducing industrial relation laws. Furthermore, the unprecedented nature of mobile app-facilitated economic activity also means there is no existing Right/Left political dynamic in which to situate the new gig economy – especially when it’s made up of predominately young ‘disruptive’ entrepreneurs.

However, in an era where greater attention is paid to the ethical standards of the supply chains that bring goods and services to the consumer, it is odd that the concern seems to ebb away at the point at which the link in the chain is a gig economy worker.

This does not mean that we can put the genie back in the bottle and go back to the pre-mobile app era of business and nor does it mean that old taxi services constituted some virtuous standard of ethical business. Yet a concern about economic justice and the legacy of the fight against WorkChoices should imply a need to advocate for better worker standards in the gig economy. After all, why should we boycott businesses that no longer pay penalty rates but be delighted about the introduction of UberEats to Canberra?

The Left’s broad ambivalence to the gig economy can surely only be temporary, as it is only a matter of time before it expands and swallows up the jobs and industries of tertiary-educated knowledge workers bringing the supposed benefits of flexibility very close to home. Yet the broad acceptance of the current terms of the gig economy will undermine any effort to fight back in the future.

Progressives accordingly find themselves at a crossroads – either the current terms of the gig economy are fought with the same ferocity with which WorkChoices was fought, or we acknowledge our implicit acceptance is allowing the implementation of WorkChoices by stealth.

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To the barricades, comrades! (google)

 

Postscript:

It seems rather relevant to this essay to mention that, on the day I wrote it, I also caught an Uber. I have drawn my personal red line at the point of not personally getting an Uber account but I am also choosing to not make an issue of my friends and family utilising it to get us to our preferred destination quickly and cheaply. While I am entirely sympathetic to any critique that this action renders me an insufferable hypocrite, I consider that there’s an inherent and unavoidable tension between acknowledging and trying to change the injustices of society while also having to live in society. The elements within the Left (described by the writer Guy Rundle as the ‘social market’ strain which operate on the basis of “letting the market run things, regulate it to a degree, and supplement what it cannot do”) that seek to address the injustices through improved individual consumer decisions can only achieve so much (but that’s a whole other blogpost).

My concerns about the limitations of the social market approach restrain me from advocating that readers ‘boycott Uber’. Instead, I advocate that we demand the State – through the existing framework of the labour movement and existing left-of-centre parties – to see addressing the economic injustices of the gig economy as a top priority industrial relations political issue (just like they did with WorkChoices) and force it to address the issues that all sectors of the economy will soon be confronted with.

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One thought on “The Gig Economy is WorkChoices by Stealth

  1. Pingback: 7 Canberra Blog Posts I Couldn’t’ve Wrote Better. – canbrrr.

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