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IF Insights: Is the United Kingdom becoming gig economy’s ‘crisis zone’?

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A study by the University of Bristol and Oxford University found that the majority of gig economy workers feel under threat from feedback processes

The gig economy, which symbolises a labour market characterized by the prevalence of short-term contracts/freelance work as opposed to permanent jobs, has entered a turbulent zone in the United Kingdom.

A University of Bristol study, which surveyed 510 gig workers in 2022, found that 52% of respondents were earning less than the current UK minimum wage of £10.42 per hour. On average, gig workers earned £8.97 per hour, reflecting a 15% shortfall.

The research also talked about the concerns like work-related insecurity and anxiety for these gig workers, with 76% of respondents reporting such experiences. Some 28% felt that their health/safety was at risk while working in the gig economy, and 25% reported experiencing pain on the job.

Looking At The Bigger Picture

In March 2023, UK-based food delivery platform Just Eat Takeaway announced plans to axe over 1700 jobs, mostly the courier ones. The venture took the drastic move as takeaway order numbers plunge post-COVID and Brits grapple with the cost-of-living crisis.

The company has been known for offering predictable wages and sick pay to its riders (gig workers). However, the changing economic dynamics have now forced it to halt its employment model in six UK cities.

A recent study from the University of Oxford rated Uber Eats and Bolt as the worst gig economy platforms, for not meeting the basic standards of fair work, like ensuring workers earn above the national minimum wage, providing them with clear and accessible contracts, and keeping these professionals safe during duty hours.

The study also accused some platforms of cutting existing protections for their staffers in order to increase profitability.

In February 2023, a ‘Deliveroo’ gig worker, while delivering a takeaway in a central London apartment, fell sick. While the Deliveroo app kept alerting the worker to complete the delivery, nobody from the company called to check if he was okay. This incident came to light as James Farrar, the general secretary of the App Drivers and Couriers Union, interacted with Mail Online.

Getting Crushed, Controlled & Disciplined

Researchers are now raising alarms that AI and algorithms are being used to monitor, control and discipline gig workers.

A new Qualtrics survey has stated that 34% of UK-based workers now have a second job, while 15% are set on securing one to make ends meet, as the European country is having an inflation of over 10% and a resultant cost-of-living crisis.

Having already increased by 65% between 2016 and 2022, according to the Online Labour Index, the demand for online gig work is unlikely to slow down. However, there is a grey area in the sector in form of the customer feedback.

A study by the University of Bristol and Oxford University found that the majority of gig economy workers feel under threat from feedback processes.

The research, published in the journal Sociology in November 2022, found that seven in 10 freelancers providing services for some of the biggest digital labour platforms are worried about unfair feedback and its negative effect on their future earnings.

The United Kingdom Trade Union Congress has been repeatedly calling for stronger rules to protect gig workers from decisions made by AI.

“AI-powered technologies are now making high-risk, life-changing decisions about workers’ lives including line-managing, hiring and firing staff,” the body said.

TUC also stated that these AI tools were being used to analyse facial expressions, tone of voice and accents to assess candidates’ suitability for roles. If left unchecked, AI could lead to greater discrimination at work, especially against candidates/employees with disabilities.

The union has also warned about AI “setting unrealistic targets that then result in workers being put in dangerous situations that impact negatively on their both physical health and mental well-being.”

In 2023, the Rishi Sunak government published its white paper on AI which proposed spreading regulation of the technology across different existing bodies rather than creating a single new watchdog. However, TUC wasn’t impressed by this.

The TUC also wants firms to reveal how AI is being used to make management decisions about staff and these decisions should be subject to a human review so that workers can challenge them.

What The Government Is Doing?

Till May 2023, the UK government has failed to live up to its promise of bringing in a modern employment bill with protections for gig-economy workers.

The Independent Workers of Great Britain Union reported in December 2022 that eight in 10 gig workers were compelled to slash their groceries and energy expenditures, while 38.9% of the surveyed workers were forced to trim their household spending or even failed to pay rent.

Over three-quarters of gig workers also had to increase their weekly working hours to make ends meet.

The highest number of gig workers (21%) is reportedly located in London, the most expensive city to live in the UK. In March 2022, the Mayor of London promised a ‘Gig Economy Charter’ by the end of 2022. To date, the promise has remained only on paper.

The Office for National Statistics (ONS) told the ‘Kingston Courier’ that they don’t collect data on gig economy workers, as the lack of legal definition and the sporadic nature of work makes categorising workers difficult.

Conclusion

With Just Eat Takeaway laying off its workers, and surveys constantly suggesting that things are not so rosy in the sector, the government inaction is now complicating things further. The European country’s 7.25 million-strong gig economy workforce is earning salaries which are not meet any of the ‘Minimum Wage’ and ‘Inflation’ standards, and this continues to remain a concern.

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