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Mazzarine Studer

August 27th, 2020

Gig economy: Employment Relations and why it is important

4 comments | 13 shares

Estimated reading time: 5 minutes

Mazzarine Studer

August 27th, 2020

Gig economy: Employment Relations and why it is important

4 comments | 13 shares

Estimated reading time: 5 minutes

MSc in Human Resources and Organisations student, Mazzarine Studer, explores the precarious working conditions of the gig economy, highlighted during the current COVID-19 crisis. She provides insight in to the increasing attention in debates surrounding the ‘Future of Work’.

Uber eats delivery cyclist

‘Gig’ workers exchange their service on a short-term and payment by task basis via digital platforms that match providers and customers. More jobs such as freelance, tutoring and caring work are likely to be included in the gig economy in the future.

Three trends help us to understand the shift in employment relations and particularly in the gig-economy.

 

1. The acceleration of the gig economy due to the transformation of the online market

The COVID-19 pandemic has redefined the way we socially interact with one another, shop, consume, and use technology. The must of social distancing has pushed us to rely on digital platforms more. The closure of shops and the fear of catching the virus has put gig economy companies as a valuable option for those that did not use it before.

Contrarily to some predictions, Deliveroo and Uber Eats deliveries’ decreased due to main restaurant partners shutting down. Nonetheless, around 3000 restaurants joined Deliveroo in March. Online food sales have doubled during the pandemic and supermarkets like Morrison’s and Marks & Spencer have partnered with food delivery companies like Just Eat to keep with the demand.

Macro-changes such as COVID-19 create new signals, behavioural shifts and trends before becoming the ‘new normal’ according to theory of change (Ipsos, 2020). The digitalisation and online consumption from businesses and people reinforced the acceleration of the gig-economy.

Online food sales have doubled during the pandemic and supermarkets like Morrison’s and Marks & Spencer have partnered with food delivery companies like Just Eat to keep with the demand.

 

2. The precarious conditions of gig-economy workers has brought the Industrial Relations school back into the conversation

 The pandemic has shed light on the precarious conditions of gig economy workers. As ‘independent contractors’, they do not benefit from any sick-pay leave, unemployment support and health-insurance. Despite companies’ effort to convince workers ‘on the frontline’ that they will be looked after, only half out of 123 gig platforms are providing personal protection equipment and some payment if they are ill. Yet, workers report that they fail to receive these (Fairwork Foundation, 2020).

Due to the nature of the gig economy, the oversupply of labour in the market gives individual workers little bargaining power to negotiate their working conditions (Woodcock and Graham, 2020). The imbalance of power and conflicting interests between the employer and the employees, highlighted by the pandemic, is at the heart of the Industrial Relations (IR) School of employment relations.

Contrary to the Human Relations (HR) School, which argues that conflicts in employment relations result from poor management practices and can be resolved through internal voice mechanisms, the IR school argues that conflict is inherent to employment relations and can only be solved through third parties such as the unions.

Why? Because in these inherent conflictual relations, internal voice mechanisms are not strong enough to channel workers’ voice to improve the situation. Gig platforms have given priorities to shareholders and investors over the workers – despite workers’ call for better conditions, (Fairwork Foundation, 2020).

Gig platforms have given priorities to shareholders and investors over the workers – despite workers’ call for better conditions,
(Fairwork Foundation, 2020).

Union membership has declined since 1995, notably because organisations have put in place strong internal voice mechanisms such as engagement surveys within a company.

Will the acceleration of the gig economy be translated in a rise of unions?

Which other voice mechanisms for workers to address conflicts in employment relations?

 

3. Reinventing employee voice

Without strong national regulations, strikes and trade unions will unlikely be as effective as in the 19th or 20th centuries.

  • First, gig-economy workers’ status of self-contractor make it difficult for them to join a trade union or organize legal strikes which varies across countries.
  • Second, the online and fragmented nature of gig workers renders it difficult for them to create a collective voice and current trade unions lack effective strategies to organise them.
  • Third, platforms do not engage with workers association despite the demand to do so (Fairwork, 2020).

Therefore, gig-economy workers turn towards social media to denounce their precarious working conditions and create a sense of collectivism. Likely, the future of ‘voice’ would express itself not through traditional unions, but through online forums such as;

  • Turkoption or a ‘gofundme’ to support Amazon workers during the pandemic
  • WhatsApp group chats
  • social media such as Gig Workers Rising twitter account with 12k followers

These create online organisation but also public awareness to make gig platforms accountable as suggested by a recent picture of a delivery rider woman holding her two children in the tube that went viral on twitter.

So far, social media brings awareness but is not a powerful actor to bargain against the platforms. Significant legislative changes and organisational engagement with representation bodies need further implementation to trigger actual changes (Yerby and Page Tickell, 2020).

It is key to understanding the complexity of this new reality to shape the future of work, one in which fair management practices go hand in hand with social justice.

It is key to understanding the complexity of this new reality to shape the future of work, one in which fair management practices go hand in hand with social justice.

 

Sources:

https://fair.work/fairwork-releases-report-on-platform-responses-to-covid-19/?lang=en

Woodcock, Jamie and Graham, Mark (2019). The Gig Economy: A Critical Introduction. Cambridge: Polity. https://politybooks.com/bookdetail/?isbn=978150953…

Lewin, D. (2001). IR and HR perspectives on workplace conflict: What can each learn from the other?. Human Resource Management Review11(4), 453-485.

https://www.ipsosglobaltrends.com/2020/02/our-theory-of-change/

https://blogs.lse.ac.uk/management/2020/05/21/post-coronavirus-through-the-ier-lens/

https://blogs.lse.ac.uk/management/2020/05/01/where-next-for-the-gig-economy-and-precarious-work-post-covid-19/?fbclid=IwAR1gf8ytaDbqHVuFki64nagC7GwTsYhwl2Lx6R7i3wdN9K75g4TIVa1-ZxI

https://www.bbc.co.uk/news/business-53559116

https://www.commercehub.com/resources/research-covid-19-shopping-delivery-trends/

https://www.accenture.com/us-en/insights/consumer-goods-services/coronavirus-consumer-behavior-research

https://info.trendwatching.com/10-trends-for-a-post-coronavirus-world

https://www.cnbc.com/2020/04/23/uber-eats-and-deliveroo-riders-in-uk-struggling-as-takeout-orders-fall.html

https://twitter.com/gtmgad/status/1292412444753776640?s=21

 

About me:

Mazzarine Studer
MSc in Human Resources and Organisations at LSE. Since work concerns so many of us and shapes what we do for most of our time, I aspire to create meaningful work-cultures as a step towards social justice. I am also enthusiast about theatre and sewing.


Learn more about our MSc Human Resources and Organisations programme

About the author

Mazzarine Studer

MSc student Human Resources and Organisations 2020

Posted In: In the classroom | The Student Lens

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