Uber – the world’s most infamous gig economy company – has admitted that it has got things wrong following the threat by London’s transport regulatory body, Transport for London (TFL), to revoke its operating licence. Not only that, but its CEO Dara Khosrowshahi also acknowledges that the company must change.
It’s fantastic that one of the world’s largest and best-known gig companies has unequivocally apologised for its mistakes, and with a promise to ‘make things right’. Now it’s what it does to go beyond the talk that matters.
This won’t be an easy task given the many criticisms faced by the company, which extend past the concerns noted by TFL. However, the most promising way forward could be found in unexpected places.
A global phenomenon – for better and worse
The gig economy is taking root quickly around the world. At the Overseas Development Institute, we’ve been researching its emergence in countries as diverse as South Africa, Kenya, Mexico, India and Jordan. What comes through clearly is that the dominant operating model has a shared set of problems globally.
As in London, the gig economy elsewhere in the world has been met with controversy for the poor working conditions faced by workers, including low and insecure earnings and a lack of protections. Serious concerns have also been raised across the board about safety and security – complaints of attacks on both customers and drivers of Uber cars have been lodged globally, with Uber’s poor response to these cases in London being a key reason for TFL’s decision to curtail operations.
It’s not just ride hailing services that have a problem – on-demand domestic workers we spoke to in South Africa report abuse and harassment by clients behind the closed doors of the households where they provide cleaning services.
But, just as taking a global perspective confirms the deeply entrenched challenges in the gig economy, closer inspection brings to light glimmers of hope.
Fixing the failure
Collective action by workers is critical to improving standards in the gig economy, as successful union-backed employment tribunal cases against platform companies have shown. Yet many companies discourage or actively ignore worker organizing – for example by refusing to acknowledge worker groups. But there is another way; a company in India supports collaboration and mutual support between its pool of largely poor and disempowered workers by developing ‘self-help’ groups.
Gig economy workers invariably carry many of the economic and personal risks of their work, often due to the ‘independent contractor’ models invoked by companies. These mean they don’t in practice benefit from full labour rights and protections. But some companies are starting to buck the trend – for example one company in Kenya invested in insurance to protect workers from injuries sustained at work.
While proactive company action to provide good conditions is the ideal, regulation also provides an important recourse to improve conditions when companies don’t play ball. Here too, there have been promising developments. The list of countries in which successful litigation has declared gig workers to be employees – and so benefit from associated rights and benefits – is growing rapidly, and currently includes the UK, South Africa, US and Switzerland to name just a few.
Amongst this optimism, it is important to keep in mind that the path is rarely a smooth one, and many positive steps forward have been thwarted by efforts to maintain the status quo. While a recent Seattle city ordinance allowing Uber drivers to unionise is a huge step forward towards improving working conditions in the gig economy, a subsequent court injunction put implementation of the measure on hold. In France, the social security agency Urssaf decided last year to classify Uber drivers as employees and demanded the platform make corresponding contributions, only for Uber to lodge a successful appeal in court. The case is ongoing.
Clearly, a reversal of Uber’s combative stance against efforts to improve the experiences of workers using the service would prove Dara Khosrowshahi’s intention to keep his promise for change. If some of these smaller players around the world can make progress, there is no reason why Uber can’t be a leading light for transformation across the gig economy.
A global conversation
But the examples above show that there would be a lot to gain from a global conversation around how to make sure that everyone benefits from the gig economy – not just companies and clients benefitting from cheap services at the touch of a button. If the gig economy is here to stay, as the emergence and rapid growth of platforms across both developed and developing countries suggests, then sharing and learning lessons from different contexts can help to find sustainable solutions to today’s challenges.
In stating Uber’s willingness to listen, run its business with ‘honesty, integrity and passion’, and ‘make things right’, its CEO has potentially set the scene for major-scale improvement in the gig economy.
Learning from others could make the difference between success and failure.