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He Tried To Organize Workers In China’s Gig Economy. Now He Faces 5 Years In Jail

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BIJIE, China — Zipping along Beijing’s streets on an electric scooter with sometimes death-defying speed, Chen Guojiang delivered hundreds of take-out food orders a day.

Along the way, he filmed short videos that documented the viciously competitive conditions for China’s estimated 3 million workers who use digital platforms for delivery jobs. More than once, he has called for collective action against powerful e-commerce companies, demanding better pay. That effectively made 31-year-old Chen — or Mengzhu, as he is more widely known — one of China’s few remaining labor organizers.

Then in February, he disappeared. News emerged the next month that he was in detention.

His arrest dealt a blow to nascent efforts to promote labor rights that have begun to gain mainstream traction during the coronavirus pandemic. It also reflects the political risks of agitating on behalf of delivery work in a country whose ruling Communist Party has shut down labor organizing and is betting on consumerism and the service industry to buoy economic growth.

“Anything that coheres collective power for workers is seen as a threat to state power,” says Eli Friedman, a professor at Cornell University who studies Chinese labor activism. “[The authorities] cannot accept an independent trade union or anything that looks a little bit like an independent trade union. That is a red line for the Chinese government.”

In March, nearly one month after his disappearance, authorities confirmed police had detained Mengzhu for picking quarrels and provoking trouble — a catch-all charge commonly used to detain both petty criminals and political activists.

However, Mengzhu’s case is being handled with an unusual degree of secrecy.

Shortly after police confirmed Mengzhu would be tried on criminal charges, friends and supporters began collecting donations to cover his lawyer fees. Within days, they had raised about $20,000 — and the attention of China’s state security forces.

Security agents contacted each of the donation campaign organizers, warning them not to help Mengzhu, according to two people close to the organizers. They requested anonymity when talking to NPR because they feared state intimidation as well.

His family says two policemen traveled in March from Beijing to Mengzhu’s hometown in Bijie, a prefecture in remote southwestern Guizhou province. They brought with them a short detention notice informing the family that Mengzhu was being held in a police station in Beijing’s Chaoyang district, where he lived.

His father, Chen Wanhua, says the two police officers demanded he sign the notice. The copy he was allowed to keep had three lines conspicuously smudged out, and he was instructed to deliver the original in a sealed envelope to the local police station.

“I have no idea what those three lines said,” the elder Chen says from his home, tucked among the mountains of Bijie. Mengzhu faces a sentence of up to five years in prison.

Mengzhu’s arrest comes even as same-day delivery workers are gaining more social recognition in China for the crucial economic and social role they play.

During widespread lockdowns imposed during China’s coronavirus epidemic, delivery workers became a lifeline, shuttling anything from food to medicine to millions of people trapped at home.

Some of China’s biggest private companies such as Baidu, Alibaba and JD.com run lucrative e-commerce and food platforms that rely on delivery workers to brave urban traffic, extreme weather and broken elevators to fulfill orders.

Companies have defended the tightly managed gig work, arguing it has created new jobs and a flexible source of supplemental income. After home delivery services began proliferating about five years ago, the average wage for couriers hovered around 10,000 yuan ($1,500) per month, more than twice the average salary at the time. Delivery salaries have since dropped to about $800, according to an industry association.

Last year, delivery workers fulfilled some 60 billion orders across China, according to government figures. Even as the volume of packages and express coffee orders climb, average pay for delivery workers is dropping. NPR found last year that companies have been cutting the per-package commissions they pay couriers by an average of 25%. Workers say tighter delivery time windows force them to drive dangerously in China’s congested cities. Being late automatically incurs heavy fines they cannot dispute.

Some e-commerce delivery workers have tried to organize wildcat strikes demanding higher pay and a less exhausting work schedule.

Workers can be just banned from using the [delivery] app again because they have caused some trouble against the platform,” says Aidan Chau, a researcher at the Hong Kong-based nonprofit China Labour Bulletin.

Strikes are becoming less frequent, however. CLB found at least 73 protests and strikes in the delivery industry in 2019 but only 41 last year, as the pandemic hit lower income workers hard. “A lot of new workers are facing economic hardships, so they are more tolerant to these labor practices,” Chau says.

Fast-talking and street smart, Mengzhu tried to reverse that trend. On social media, he was followed by tens of thousands of delivery workers and drivers on Douyin, the Chinese-language version of the video-sharing network TikTok.

At first, delivery work gave him a way to leave behind a difficult childhood in Bijie, an area once infamous for its poverty.

His mother abandoned the family when Mengzhu was still in elementary school.

Mengzhu dropped out of school in fifth grade, and at age 14, he left Bijie in search of work in China’s big cities, like many young men from his village. With savings from earlier delivery jobs, he opened two fast-food restaurants in Beijing. When they failed to turn a profit, he returned to delivery work and picked up video blogging and got involved with labor activism. He opened a cellphone accessory store in Beijing and ran a free shelter for other delivery workers who were new to the city.

Organizing delivery workers is difficult, particularly in food delivery. They are often freelance contractors or work for a loose confederation of third-party services, which then bid against one another to fulfill orders from bigger e-commerce platforms. The challenges clearly frustrated Mengzhu, who vented about his cohort on a Chinese podcast.

“To be frank, delivery workers are an uncivilized lot who are extremely short-sighted,” Mengzhu bemoaned in a Chinese podcast.

Yet he persisted. On Douyin, he posted videos almost daily, sharing snippets of his delivery routes and featuring other “riders,” as the workers are called in Chinese, down on their luck. The goal, he said repeatedly, was to create a collective understanding among workers that they faced common challenges.

“Delivery workers are humans too, not robots, though the system wants to make us like cogs in a machine,” he told viewers last spring, after a series of Chinese media investigations brought the sector’s demanding work conditions to mainstream attention.

Mengzhu’s social media accounts have been deleted since his arrest in February.

Despite its socialist roots, the Chinese state is extremely wary of collective action. Its Communist Party-governed system operates a state-run union, but authorities have detained dozens of labor organizers in the past for trying to set up independent shops.

Mengzhu was no stranger to such trouble. In October 2019, he spent nearly a month in detention for trying to organize a three-day walkout among Beijing logistics workers ahead of the country’s Nov. 11 major online shopping holiday.

“They can do everything to arrest you, fix you with a criminal charge, sentence you to years in prison, and you change nothing,” he recounted last September, about his detention. “So do other delivery workers still dare [to complain]? Well, I dare.”

Amy Cheng contributed research from China’s Guizhou province.

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Gig Worker Platform Payfare Launches Visa Card

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Payfare, a FinTech that provides payment and banking services for gig workers, has launched a collaboration with Visa to add Visa SavingsEdge to its platform.

The Toronto company announced the project on Wednesday (Sept. 22), saying that it would begin with the nationwide DoorDash DasherDirect card program.

Read more: DoorDash Partners With Payfare to Launch Banking Solution for Drivers

With Visa SavingsEdge, gig workers who are also Visa business cardholders can save on purchases with participating merchants, with discounts on things like fuel, auto parts, travel and dining from local, regional and national vendors.

“Our goal is for every worker in the global gig economy to become an empowered entrepreneur with financial security,” said Marco Margiotta, CEO and founding partner of Payfare. “With the addition of Visa SavingsEdge, we are arming gig workers with another financial tool to help them save and keep more of their hard-earned money, while supporting the overall financial health of the growing gig workforce.”

“Visa SavingsEdge will give gig workers the ability to take advantage of savings that are typically reserved for large businesses,” said Dahvie James, lead product manager for Visa SavingsEdge. “We know a sizable portion of the workforce already participates in the gig economy, and that the percentage is only growing. As we look toward enabling the financial health of these workers, we are thrilled to partner with Payfare to make Visa SavingsEdge available to them.”

Read more: Gig Workforce Payments Platform Payfare Opens Trading at $6

Payfare went public earlier this year with a $65.4 million initial public offering.

Payfare and DoorDash launched the DasherDirect program in December 2020. The card is issued by Stride Bank and is powered by Payfare. The platform offers drivers a mobile banking app and a business Prepaid Visa Card, as well as new rewards. DoorDash workers can also choose to have earnings automatically added to the card every day at zero cost. Users can also use the platform to check their balance, pay bills, transfer money and set savings goals.

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NEW PYMNTS DATA: TODAY’S SELF-SERVICE SHOPPING JOURNEY – SEPTEMBER 2021

About: Eighty percent of consumers are interested in using nontraditional checkout options like self-service, yet only 35 percent were able to use them for their most recent purchases. Today’s Self-Service Shopping Journey, a PYMNTS and Toshiba collaboration, analyzes over 2,500 responses to learn how merchants can address availability and perception issues to meet demand for self-service kiosks.

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Lyft built a brand on being the nice gig work app clad in pink. Its drivers paint a different picture.

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SAN FRANCISCO — Ray Givaudan has driven for Lyft, Uber and even briefly Instacart to supplement his retirement over the last few years.

At first, the 55-year-old was loyal to Lyft. But then Uber introduced a long pickup fee to pay more if he goes out of his way to pick up a passenger. In addition, he could see what a customer paid for a trip, helping him understand whether he was getting a fair share. Instacart provided more opportunities for work during the pandemic.

“The first couple of years with Lyft, you seemed to be a decent company and transparent,” the Roanoke-based driver recently wrote in a letter to Lyft co-founders Logan Green and John Zimmer. “The last couple of years, not so much.” He cited the disappearance of surge-priced pay, lagging driver rewards, and the removal of helpful features such as a live phone help line for drivers.

Lyft has spent years trying to win over drivers and passengers with fun branding, an emphasis on social justice and charitable causes, and in-app tipping. The perks gave it a reputational edge in a marketplace where rival Uber was criticized for its treatment of drivers and corporate scandals, and where food and grocery delivery was a budding and uncertain sector of the gig economy, often with lower pay.

But the pandemic and related labor shortage have dramatically shifted that landscape over the last couple years. At Lyft, which remained focused on ridesharing, ridership was down by as much as 75% last year.

Drivers aren’t bound to one company, and can easily switch between apps. In the interim, many drivers chose to work for rival food delivery services, which experienced a boom in deliveries and offered additional transparency into earnings, along with such advantages as negating the risk of interacting with passengers. Companies such as DoorDash and Shipt added driver incentives, such as cash bonuses last winter in an effort to meet surging demand.

And while Uber experienced similar ridership declines to Lyft at the height of the pandemic, it doubled down with its Eats food delivery business.

Now demand for rides is returning, fueling a driver shortage. And as other companies have offered steadier work and more transparency, some drivers say they are frustrated with Lyft.

Lyft has fallen behind the gig work market in several areas, more than a half-dozen drivers, analysts and researchers say. Lyft’s take-home pay also tends to be lower than that of its biggest rival, Uber, owing to a combination of stiff competition and algorithms less sensitive to surges in demand.

“I think Lyft is floundering,” Givaudan said.

Lyft spokeswoman Julie Wood said the company places a priority on the driver experience. She said quoted wait times for riders on Lyft were lower than on Uber in 24 of the 30 largest markets over a recent period, according to company data points and visualizations that were shared with the Washington Post. That meant there was little indication drivers were choosing Uber over Lyft. And drivers in some cities were earning more than $35 an hour, well beyond what they would typically collect, the company said recently.

But the lack of transparency can lead some drivers to feel they’re not receiving a fair share. One driver shared screenshots with the Post showing that a passenger paid more than $43 for a trip from Northwest Washington to Reagan National Airport, but he took home just more than $16. The driver, a music instructor who spoke on the condition of anonymity because he did not want his students to know he was driving for Lyft, had to ask the passenger to see how much the person paid for the ride.

Wood said many of the features mentioned in this article are available on the Lyft app, either through pilot programs or unlockable driver rewards. Lyft has a long pickup bonus in six markets, for example. And drivers can earn the ability to see passenger destinations through their driver rewards, she said. Lyft is also experimenting with upfront pay in two markets, allowing drivers to see the earnings and trip details on the screen before accepting a ride.

Uber spokesman Matthew Wing acknowledged that the company has had to make improvements in the face of outside pressure and calls for change.

“Being the market leader comes with more scrutiny, as it should,” Wing said.

Instacart spokeswoman Natalia Montalvo said the firm met a March 2020 goal to add 300,000 shoppers, and there are stable numbers of shoppers across North America.

DoorDash declined to comment. Amazon and Shipt did not immediately return requests for comment. (Amazon founder Jeff Bezos owns the Washington Post.)

Drivers say they’ve watched a shift at Lyft from its beginnings, when it was the first ridesharing app to implement a default tipping feature and has allowed customers to tip since its debut nearly a decade ago. Lyft also was first to let drivers pocket their earnings right away through a feature called “Express Pay,” with instant deposits for a transfer fee, it said.

In California, estimated to be the largest U.S. market for gig work with more than one million workers, a 2019 law that mandated companies treat gig workers as employees helped drive some changes in driver treatment. Some companies — particularly Uber — added a number of perks for drivers, including more control over fares and transparency into earnings even before a driver took on a ride. The initiatives tried to prove drivers were independent.

Lyft didn’t adopt new features, as it pursued a different legal strategy. Analysts said that company likely benefited from the fact that Uber drivers were turning down trips, and the changes Uber made to its app were costly from a research, development and operational standpoint.

Still, some of Uber’s changes were short-lived. It uncoupled driver earnings from passenger fares earlier this year as it no longer needed to prove drivers were independent operators in a supply-and-demand-based marketplace, sparking outrage among some drivers.

That led to cases where passengers found themselves paying astronomical fares while drivers collected meager bonuses. Meanwhile, some riders trying to take a Lyft were shown reasonable prices, but there weren’t drivers to accept the fares.

Ridesharing apps are highly dependent on their matching algorithms to pair customers with nearby drivers for a reasonable fare, at a rate that ensures gig workers are willing to make the trip.

Lyft’s algorithm is less sensitive, analysts said, meaning prices don’t spike as easily and driver bonuses can be lower and less frequent. Wood pointed to the wait time data as evidence that there is an ample supply of drivers, however.

But the differing algorithms can lead to headaches. For example, when customers pouring from an event are all demanding rides at once, they might find the price of an Uber has spiked while Lyft is comparably cheaper. In that case, Uber’s algorithm has detected a surge in demand and raises the price accordingly so customers can secure a ride with the limited supply of drivers.

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‘Gig workers’ approach Supreme Court, seek social security benefits from Zomato, Swiggy, Ola, Uber

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A petition has been filed by “gig workers” before the Supreme Court praying for social security benefits from employers including food delivery apps Zomato and Swiggy and taxi aggregator apps, Ola and Uber.

Gig workers are independent contractors or freelancers who undertake short-term work for multiple clients. The work may be project-based, hourly or part-time, and can either be an ongoing contract or a temporary position. The number of “gig economy” contract workers has grown in recent years; and during the COVID-19 pandemic, even more workers have joined the gig economy, as those who lost their full-time jobs began freelancing to make ends meet.)

The petitioners have reasoned that they are unorganised workers under the Unorganised Workers’ Social Welfare Security Act, 2008, and are therefore entitled to social security. It has been contended that the State’s failure to register them under the Act is violative of their fundamental rights, especially since the legislation has been enacted pursuant to Directive Principles of State Policy with a view to ensure basic human dignity of the workers.

“Denial of social security to the said “gig workers” and the “platform workers” has resulted in their exploitation through forced labour within the meaning of Article 23 of the Constitution. The right to livelihood includes the right to work on decent and fair conditions of work,” the plea said.

The respondent companies have been claiming that there exists no contract of employment between them and the petitioners, and that their relationship with the petitioners are in nature of partnership.

The petitioners have cited judgment of the UK Supreme Court which had held that Uber drivers are “workers” entitled to minimum wage, paid annual leave and other workers’ rights. – BENCH AND LAW

(To receive our E-paper on whatsapp daily, please click here. We permit sharing of the paper’s PDF on WhatsApp and other social media platforms.)

Published on: Tuesday, September 21, 2021, 11:13 PM IST

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