SINGAPORE – Countries around the world are starting to look into safety nets and ways to improve working conditions for gig economy workers, who are usually categorised as independent contractors or self-employed and fall outside the ambit of labour laws.
Some changes have started to take place, especially in Europe, mostly due to court rulings.
In a massive change of its business model, ride hailing giant Uber recognised some 70,000 of its drivers in Britain as “workers” from mid-March this year, granting them a minimum wage, paid leave and pension plans.
Uber also announced a pact with the private hire car union GMB to represent its drivers in the United Kingdom.
The moves came after the British Supreme Court upheld a ruling that Uber’s drivers should be classified as workers rather than independent contractors.
In Spain, a legislation known as Rider’s Law mandates that food delivery platforms categorise couriers as salaried staff with rights such as collective bargaining.
Coming into effect on Aug 12, it also requires the companies to disclose how their systems work in terms of assigning jobs and assessing couriers’ performances.
This followed a Spanish Supreme Court ruling in September last year that a courier working for Spanish delivery company Glovo was an employee.
Over in Italy, online food delivery company Just Eat placed its riders on a national contract, giving them a minimum wage of €8.50 (S$13.50) per hour, paid leave, sick leave, social security and insurance, as well as union representation.
This comes after the Milan Public Prosecutor’s Office in February gave food delivery companies including Uber Eats and Deliveroo three months to hire their riders on a collaboration contract or face hundreds of millions in fines.
In neighbouring Switzerland, a Geneva court ruled in June last year that Uber Eats is an employer and has to hire drivers as full employees, with social insurance and other employment benefits. Uber has filed an appeal with the Federal Court, with a decision expected by the end of the year.
Following suit, Asia-Pacific countries have started nudging gig economy platforms to provide more protections for this group of lower-wage workers.
Two months ago, China’s market regulator and six other government agencies issued guidelines for the sector, insisting that workers be paid a minimum wage and on time, and provide medical insurance and access to social security.
The Philippines Senate will be passing a Bill which provides a “mantle of protection” including just remuneration, social welfare benefits and protection to freelancers and workers in the sector.
In Malaysia, over 145,000 delivery riders employed by Grab and Foodpanda now have social security under the Social Security Organisation’s (Socso) SPS-Lindung scheme, with the federal government paying a year’s worth of social contribution amounting to RM 232.80 (S$75.20).
Under the scheme, those who get injured or die while working will receive medical benefits and payouts from Socso, which is under the Ministry of Human Resources.
However, critics say the scheme perpetuates the exploitative nature of companies that hire gig workers by allowing the firms to avoid paying for healthcare and insurance benefits for the workers.
Australia’s popular online food delivery platform Menulog announced in April that it will directly employ its couriers and give them rights such as a minimum wage and superannuation contributions.
It has also increased insurance cover and examined ways to create a pool of money riders can draw on for sick leave and holidays.
The announcement came two months before an interim report by a Senate committee raised concerns about the lack of basic job protections and low pay for gig economy workers.
In the United States, several companies have set up lobbying groups and are working with unions in various states to strike a compromise that would allow drivers and food delivery workers to organise in a union and negotiate minimum pay and other benefits – without being reclassified as employees, Reuters reported in June.
Still, in a setback to the firms, a judge in California ruled three weeks ago that Proposition 22 – a measure that allowed gig economy firms to classify gig workers as independent contractors with limited benefits such as stipends for healthcare – was unconstitutional. The firms have said they will appeal.