How to make the gig economy work for all

SPONSORED: Behind the bad headlines about zero-hours contracts and exploitation, the gig economy is increasingly popular with both businesses and workers. Here are some dos and don'ts for getting it right.

by MT Staff
Last Updated: 28 Mar 2017

The freelance-based gig economy is booming – there are now more than 30,000 Uber drivers in London, while major retailers like John Lewis and Next have goods delivered by courier firm Hermes, which uses 10,000 couriers. And it's not all about logistics either – from web developers to accountants, management consultants to lawyers, a whole range of professionals and technicians are increasingly likely to be gig-economy workers.

The gig economy hasn’t exactly had the best of press. In fact the model, in which people pick up work on a job-by-job basis, usually through an app or online platform, has barely been out of the spotlight lately: Uber has been subject of court cases and protests for its treatment of workers, who don’t have the same rights as regular employees, while food delivery firm Deliveroo caused consternation for popping a clause into its contracts banning workers from contesting their self-employed status at employment tribunals.

Growing pains aside, there's no denying it's popular – and not just with ‘disruptive’ start-ups. Many workers like the flexibility and freedom it provides, and even traditional corporate employers increasingly find that a hybrid mixture of gig and full-time employment matches both their own needs and those of many workers very well.

So the gig economy is here and it’s on the rise – PwC predicts that the UK gig economy will be worth £2 billion by 2020 – so heres how to make it work for you and for your workers…

• Pay people properly. The gig model works well for skilled freelancers, because they're (generally) paid a decent wage. In some sectors, temporary workers are incredibly well rewarded – some tech jobs are advertised at an average rate of £460 per day. That kind of fee wont be appropriate for every role, but at least meet the market rate, and take into account any extra costs theyll incur.

• Make it a genuine win-win. PwC launched its Talent Exchange last year, where freelancers can upload their CVs online and apply to work on the firm’s client projects – whether that's in IT or anti-money laundering. The stated aim was to ‘bring in the right talent in the right place at the right time’, according to PwC chairman Bob Moritz, while meeting the trend towards freelancing as a career.

• Build in protections. Having been criticised for using zero-hour contracts, Amazon now offers its temporary staff guaranteed pay for 20 hours, even if that work isn’t available.

• Treat everyone equally (well). Its about welfare and wellbeing of workers, whether gig or full-time. Regardless of how they are employed, people are more creative, engaged and responsive when treated properly. Try to bridge the discrimination gap between gig workers and full-time workers: regular full-time employees receive performance reviews and other career-development support, as well as channels through which to voice concerns to their bosses or boards. Gig economy workers dont, but they should. And invite them to the Christmas party…

• Think how it reflects on you. Getting caught on the wrong side of the gig economy can cost you dearly in reputational capital. Hermes was the subject of a Guardian investigation last year, to which couriers complained they were being paid at levels equivalent to below the national living wage. One Hermes courier in Manchester estimated that, after expenses, she was on a measly £5.50 an hour. Sports Direct became synonymous with zero-hours contracts, which stipulate workers have to be available to work, even without the guarantee of a minimum number of hours. Its depot in Shirebrook, Derbyshire ran a ‘six strikes’ policy that had people in fear of losing their jobs for misdemeanours such as excessive chatting or long loo breaks, while workers were docked 15 minutes of pay for arriving a minute late. And once it gets out, this stuff sticks: in September, Sports Direct announced it was ditching zero hours contracts, and founder Mike Ashley vowed to give his workers representation at the highest level, ‘to help ensure that all staff are treated with dignity and respect’.

It’s also worth flagging up Matthew Taylor's review of modern employment practices, commissioned by the Department for Business, Energy & Industrial Strategy and due to report in the summer. A government report is often the first step on the road to regulation, and it will be a surprise if Taylor’s report doesn’t lead to recommendations for legislating the gig economy. So you might as well get on the front foot now and prepare for any new laws which may be in the pipeline.

For more ideas on how to build bulletproof health and safety, visit the Institution of Occupational Safety and Health