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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Fake news and ‘post-truth’

Following the unexpected victories of the Leave campaign in the Brexit referendum and Donald Trump in the US election, media commentators have been scrambling for an explanation. The search for an explanation stems from both the unexpectedness of the results and the fact that it took place despite the overwhelming majority of major media publications recommending against it.

A prevailing explanation across many parts of the media and political spectrum is that the results were largely driven by the phenomena of ‘fake news’. Some major examples include one of the central claims of the Brexit Leave Campaign – that 350 million is sent to the European Union every week (which, as The Guardian has written, does not stand up to the facts. The New York Times has written about “Fake News Sausage Factories” based in Eastern European countries churning out deliberately fake pro-Trump news stories with the purpose of influencing the US election.

I do not seek to dispute the veracity of the investigative journalism in the above articles or deny that there are partisans who are self-consciously propagating factually incorrect stories. What I am interested in however is the notion that ‘post-truth’ is a relatively new concept and the implicit assumption of many articles decrying fake news – and, indeed, of most mainstream media publications – that, had those fake stories not existed and people were instead exposed to ‘real news’, they would not have voted either for Brexit or for Trump.

To appreciate why this is a poor prism through which to understand the changes that have taken place in the media landscape over the last few years, it is worth asking not why people find ‘fake news’ believable, but rather why the value of ‘objective facts’ – and, by extension, fact-checking – has plummeted in public discourse.

The focus on fake news perhaps reached its zenith with the Oxford English Dictionary announcing ‘post-truth’ as its 2016 Word of the Year – which it defines as “circumstances in which objective facts are less influential in shaping public opinion than appeals to emotion and personal belief.”

However, the real question is why Oxford English Dictionary might have waited until 2016 to declare it the word of the year, when the process of ‘objective facts’ being subsumed into ‘emotion and personal belief’ has been gathering momentum for decades.

Take, for example, the phenomena of human-induced climate change. This is a process which has been established to a high degree of certainty since the early 1990s. It has been the overwhelming consensus of national scientific organisations and reflected in each of the United Nations International Panel on Climate Change reports. The scientific nature of the issue was also expressed in economic terms in the landmark 2006 Stern Review, which found that “the benefits of strong and early action far outweigh the economic costs of not acting.” If there is any public policy issue that has significant expert consensus (and would therefore meet the articulated standard of ‘objective fact’), it is Anthropogenic Climate Change.

Despite this, significant sections of the media and political class have never truly accepted its veracity. From right-leaning media organisations who reject it outright to organisations such as the ABC and BBC who have in effect downplayed the issue through the promotion of ‘false balance’ in its reporting.

Climate change ‘critiques’ sometimes take the form of disproportionate coverage of a tiny minority of scientist ‘climate skeptics’ (usually from outside the field of climate science). More often however, climate science is rejected on the basis that the scientists are biased by their desire to implement communism or, more typically, through a vague religious devotion to environmentalism or groupthink. While this line of attack appears in all the usual suspect right wing media outlets, it is perhaps noteworthy that it also came from Bret Stephens from the New York Times – a reporter and newspaper which sees itself as a vanguard against the ‘war on truth’ just earlier this year, in his article warning against “overweening scientism” in the climate change debate.

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The NY Times’ insufferably sanctimonious advertisment – photo credit

Given the extent to which major media publications across the political spectrum have promoted the idea that public science institutions (originally established to provide objective policy guidance on issues requiring scientific-expertise) are either incompetent or motivated by political bias, it should not come as a shock that populist political leaders extend that critique to other institutions with ease.

That task has undoubtedly been made easier by the fact that many prestigious economic institutions have allowed themselves to be drawn into politics. The US Federal Reserve, through its former chairman Alan Greenspan promoted a vision of economic management that had significant consequences in terms of defining the policy options of governments (through, for example, a deference to market-based solutions to public policy issues). Following the Global Financial Crisis (GFC), he was forced to admit that he had put too much faith in the self-correcting power of free markets. The International Monetary Fund (IMF) was at the forefront of the post-GFC push to implement austerity policies in countries such as Greece to boost “market confidence.” In 2013, the IMF admitted these policies had not worked and instead resulted in a “deeper than expected” recession.

In an era where scientific institutions have been discredited for political ends and economic institutions, through their political ends, have discredited themselves, is it any surprise that significant sections of the public identify with the now-famous observation that “people have had enough of experts”?

The dilution and politicisation of objectivity explains why ‘fake news’ as a phenomena is not going anywhere and why many of the proposed antidotes are likely to fail. The interest in Facebook fake news filters or greater proliferation of ‘fact-check’ articles, for example, assumes that there is an organisation or set of statistics that somehow floats above the political partisan debate – but the media have, over the past few decades, methodically dismantled any such possibility.

In light of the above, it seems that the only difference between the ‘fake news’ of the past few years and the fake news of the past few decades is that traditional media organizations have lost their gatekeeper status and monopoly on its dissemination. The major media publications may not like the fact that Trump denies ‘objective facts’ but he is only taking advantage of a phenomena that they have created.

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Many thanks to the BBC for debunking this fake news story before something serious happened. photo credit