An employment tribunal ruling in London last week that >Uber drivers are “workers” and not “self-employed”, and therefore entitled to a minimum wage and paid leave, could have implications not only for Britain’s 40,000 Uber drivers but for others associated with the ‘gig economy’ in Britain and beyond. >Uber’s business model is predicated on calling itself a platform that connects those who want transportation services to those who provide them. The ruling held that Uber sells rides, not software, despite its legal and corporate structure and licensing agreements attempting to suggest otherwise. The gig economy is driven by algorithms and technology. It extends beyond ride-sharing applications to food delivery, car rental and hosting services. Earning money as an independent contractor — that is, through a gig — is not new. But the changing nature and growth of such business models and their inextricable linkages to technology, often via a smartphone app, is making it hard for regulators to keep up. From the consumer’s perspective, app-based transportation services have been beneficial: increased clarity on pricing, speedy redress of complaints, decreased waiting times via efficient driver-passenger match algorithms, and so on. The business model has brought more drivers into the workforce by offering flexible hours and gigs to anyone who meets certain criteria. From the service provider’s perspective, the ability to work flexible hours can be a way to earn supplementary income. The British ruling, where the complainants were Uber drivers, focusses on the producer. It has ruled that clever use of legal and technological instruments cannot circumvent basic work-related rights. Thus it has begun the overdue process of determining the producer’s obligations.
In India, with its vast unorganised labour force and patchy social protection, piecemeal work, such as that offered through apps in the for-hire transport market, holds the possibility of earning a livelihood that is above the minimum wage. The issues in India, for now, are likely to be different from those in the U.K., such as ensuring that algorithms do not incentivise drivers to work beyond the permitted maximum number of hours. There are, however, broader themes shared across borders and the range of offerings in the gig economy — including the need for companies to be transparent about their policies and practices so that regulation can be crafted in the first place. Such regulation should be streamlined, responsive to changing ground realities, and easily understandable by users. Any successful way forward will nurture innovation while protecting the rights of all stakeholders.