It has been 10 years since Uber arrived in Australia. While there have always been independent contractors that work on demand, the launch of the app-based ride-hailing business triggered a surge in the number of people working in the gig economy. There are few people today who don’t have an app on their phone for ordering food or moving around the city.
But behind the slick technology is a workforce that has traded flexibility for fewer rights and conditions. For some workers, this may suit them, but the trade-offs can be severe. Gig economy contractors have no right to a minimum wage, sick leave, unfair dismissal protection, workers’ compensation for injuries, or employer superannuation payments under Australian law. It is a situation that has set off a long-running battle in the courts and the political arena between the gig economy companies and unions.
Behind the slick technology of the gig economy is a workforce that has traded flexibility for fewer rightsCredit:Bloomberg
In the latest ruling this week, the Fair Work Commission determined that gig economy companies could continue to classify their riders as independent contractors rather than full employees entitled to minimum wages and protections after a ruling by the nation’s industrial tribunal.
While the commission found that, in practice, the driver’s work had the hallmarks of employment, a recent High Court ruling had forced them to focus overwhelmingly on the terms of the contract between the driver and Deliveroo. The High Court decision overruled the approach by some courts to look beyond a worker’s contract to the social reality of the work relationship, instead relying almost solely on the terms of the contract itself.
Gig workers looking to secure an extension of their rights in the courts may have hit a dead-end, but the change of government at a federal level is expected to open the way for change. During this year’s election campaign, the Albanese government promised to give the Fair Work Commission powers to set minimum pay and conditions for “employee-like” workers, including those in the gig economy. While it continues to support the policy, Labor is yet to make public any legislation or details on how the proposal would work.
State-based efforts to protect gig workers in Victoria and NSW have been much discussed but little delivered. The states have a key role to play, especially in ensuring riders’ families get the same payouts as other people if their loved ones are killed on the job, and should not tarry on those reforms alongside the federal plans.
Pressure from unions is starting to have an impact, though, with Uber recently striking a deal with one of its strongest critics, the Transport Workers’ Union. The new deal binds the US company to back more regulation requiring the industry to give drivers and couriers a form of minimum wage and rights to appeal dismissals. Earlier in the year, the union signed a similar deal with the online food ordering and delivery platform DoorDash.
Despite the win for Deliveroo at the Fair Work Commission this week, the British online food delivery company said it was ready to “look at developing the right national reform framework to allow us to give riders the security and benefits they deserve alongside the unprecedented freedoms that on-demand work offers”. This is an encouraging sign.
At a time when high inflation is resulting in the biggest fall in real wages for more than 20 years, the time has come to ensure that gig workers, who are mostly poorly paid and have little power to set their own conditions, are offered the same legislative protections that most workers take for granted. It may require all of us to pay more for services that have become an essential part of our daily lives, but the broader benefit to the economy and those who work in the gig economy would far outweigh the extra couple of dollars it may cost to order a meal.
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