Good work in the gig economy – showcasing the future work awards

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  • Future of Work
  • Future Work Awards
  • Employment

Gig work is here to stay. But can we strike a better balance between flexibility and security? Our Future Work Awards finalists include a suite of innovations emerging to help secure good work in gig economy.

The gig economy – the growing trend of using online platforms to find small tasks that are often completed ‘on demand’ – is nothing if not controversial. To some it promises the freedom to work when they want and flexibility to fit work around caring or study commitments. To others it is viewed as a way of transferring risk onto workers – a return to 19th century piece work.

But all signs point to its continued existence. A 2017 RSA/Ipsos Mori survey found that while 3% of people in the UK have tried gig work as many as 26% of young people (aged 16-30) would consider using  platforms in the future. And platforms are starting to emerge in new sectors. Uber has recently entered freight trucking in the US and has plans to move into hospitality. Lawyers meanwhile can log onto the PeerPoint platform developed by Allen & Overy.

These workers face plenty of challenges. And the Government has been slow to act. Can we look to the grassroots for answers?

Here are three innovations set to shake up the gig economy, for the better.

Fairer platforms

Workers in the gig economy face hefty commissions when completing tasks via an app. Uber and Lyft reportedly charge service fees between 20-25% while Task Rabbit charges 15%.

But another way is possible. Just look at platform co-operatives. This movement is more established in the US, with platforms like Up&Go for cleaners in New York and Loconomics for massage therapists, personal trainers and other local service professionals in San Francisco. The business models differ slightly but central to both is an aspiration to give gig workers a better deal. Loconomics charges a subscription fee of $39 per month but enables workers to set their own wages and keep all their earnings. Up&Go takes a modest 5% referral fee to support platform maintenance.

As co-operatives, both give workers a say in organisational decision making and a share in profits. Workers also benefit from pooling with others to reduce the cost of services such as marketing. Up&Go technology even helps prevent wage theft from uncompensated cancellations.

We should be careful not to oversell the potential of platform co-ops. It remains to be seen whether these models could seriously compete with the likes of Uber and Deliveroo – platforms backed by VC investors with deep pockets, who have been able to develop more sophisticated algorithms and attain ‘networked monopoly’ status after reaching a critical mass of users. However, platform co-ops have had some traction where they offer a fairer alternative to traditional agency work – or where a group of otherwise independent workers could benefit from banding together under the banner of a platform. The aforementioned have circa 500 users to date.

Portable benefits

Gig workers often lack access to important employment benefits such as holiday pay, sick pay, parental leave and pension contributions. And there are ongoing disputes in the UK about what and how much platforms should provide for.  

Elsewhere trade unions have taken matters into their own hands. Alia, a spin out of the National Domestic Care Workers Alliance, provides house cleaners in the US with an online platform for portable benefits – benefits that can be accumulated on a pro-rata basis across multiple employers. Alia works by enabling different clients to contribute to a single pot ($5 per job in lieu of regular gratuity), which can be drawn down to cover sick pay, life insurance and paid time off.

Some platforms have started to get creative too. Hyr has created a points-based system for workers in New York and Toronto who use the platform to find jobs in the hospitality sector. Workers on Hyr earn 6% of their earnings in ‘UPoints’ which can be exchanged for paid holiday leave.  

Similar ideas have actually garnered support from the likes of Deliveroo. With CEO Will Shu suggesting “If you work with us for 40 hours a week then that relationship and the benefits you get should mirror that much more [those] of an employee… However, if you log in once a year, then it shouldn’t.” The challenge, for the UK context at least, is how this fits with existing employment law.   

#FinTech4GigWork

Apps like Monzo and Starling have been a mainstay in recent years, benefitting savvy millennials by revealing how much they spend on Avocados or trips to Sri Lanka. But they are rarely geared towards people with more precarious finances.    

Watch this space: a new breed of FinTech is starting to emerge, one which is designed with atypical workers in mind.

Trezeo has been developed to help gig workers – and self-employed people more generally – weather the income volatility they experience due to unpredictable working patterns. Trezeo is an income smoothing bank account that tops up earnings during quiet periods, interest-free, to ensure a consistent pay cheque. It works by leveraging open banking and machine learning to understand income patterns and financial behavior, and model risk. Gig workers can sign up for a £5 per week subscription fee.

These workers are also often ‘thin file’ with little to no credit history, disqualifying them from fairly priced credit and loans. Portify partners with UK gig platforms to address this. Gig workers can connect their bank account to the app and can see their financial activity across all the platforms they work with. This data is then used to provide a credit score and help them manage their finances. And if their balance is running critically low, it offers emergency credit that can be spent at select stores on essentials. For more on Portify see Sho Sugihara's blog for the RSA

Enabling WorkerTech for the many

We can picture a future where the Deliveroo rider, Uber driver and Upwork coder are more economically secure, buoyed by platforms and tools geared towards good work. But most of these innovations are still in their infancy. What will it take for them to go mainstream?  

The RSA Future Work Awards aims to shine a light on them, raise their profile and give them legitimacy in the eyes of potential funders and users. Organisations like Bethnal Green Ventures have been key in helping similar ideas get off the ground in the UK. Trade unions could have a big role to play here too. As well resourced, progressive organisations, it may be their responsibility to experiment with and deploy new technologies that serve unmet needs, in the gig economy and beyond.

The initiatives profiled in this blog are finalists for the Future Work Awards – stay tuned for the winners announcement on 6 February 2019.

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  • These guys have been established since 2004 in France and bring formal employment benefits to their 850 members whilst rejecting traditional notions of entrepreneurialism - http://www.coopaname.coop/article/coopaname-cest-politique Does anything similar exists elsewhere?

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