Reshaping Legislations, Not the Workers

by Chhavi Banswal, Ola Mobility Institute

Platform businesses emerged as a straw in the wind during the global financial crisis of 2007–09. Digital platforms, once touted as new-age innovative start-ups, paved the way for what is now a full-fledged platform economy, poised to be valued at USD 10 trillion by 2025, in the US alone. Notably, since the financial crisis there has been an increase in the youth self-employment rates around the world, particularly in high income countries in Europe. Take for instance Germany, where the percentage of young own-account workers doubled, from 2.4 to 5.7 between 2006 and 2016.

Unlike traditional jobs, platform jobs can offer a myriad of options to the young workers of the 21st century. From full-time, part-time opportunities to stop-gap solutions and the chance to be one’s own boss, the platforms are redefining the future of work. Thus, while according social security to platform workers, it is pertinent to disengage the concept of worker entitlements from employment status. Platform work has found a preference among the youth because of its alterity from traditional jobs. By bringing platform jobs into the fold of traditional work, with the sole objective of extending social security coverage, these workers are inadvertently forced to make a trade-off between benefits that should otherwise be universal, and the freedom of choice platform work empowers them with.

A recent research highlighted that among the workers engaged with platforms to earn a livelihood, over half were youth between the ages of 16 to 34. This drastic shift towards new-age, tech-enabled work models can be attributed to the changing paradigms around the sense of ‘permanency’ that was attached to jobs in the previous generations. The young workers, especially in developed countries, earlier looked at opportunities as ‘a job for life’. Platformization has antiquated this outlook. The youth of today find themselves giving preference to short-term work arrangements, even before completing their education.

A recent study by Ola Mobility Institute (OMI), titled Unlocking Jobs in the Platform Economy corroborates this preference for platform jobs among youth and goes on to explore the motivations behind it (refer to Chart 1).

Source: Unlocking Jobs in the Platform Economy, OMI

The primary survey of 5,000 platform and non-platform drivers in India, found that the Experiment Group (platform drivers) was largely dominated by those who wanted to be an entrepreneur/their own boss or appreciated the flexibility of hours platform work granted them. About a quarter also spoke of the income they received from platform driving as a supplementary source to fund their college education or save for other familial expenses. Moreover, the survey substantiates that platform driving is also viewed as a stop-gap job, i.e, one where the individual is looking for jobs during periods of unemployment, or taking up the work during seasonal unemployment. Another study in England underscores that the young workers of today view platform opportunities as a way to earn ‘without having a big commitment like a job’.

Thus, a platform worker may not primarily be a worker, but a student who took on the additional role to pay for education, or a factory employee who wants to supplement their income or an off-season farmer waiting for the next cropping season. Such is the diversity of platform jobs, which makes them markedly different from traditional jobs. Thus, the very nature of platformization stands to be jeopardised if platform workers are brought under the purview of legislations enacted for the traditional workers.

Moreover, OMI’s study also finds that social security schemes have low uptake among drivers overall, even among the platform drivers (refer to Chart 2), who otherwise show greater financial literacy compared to their counterpart. That platform drivers tend to be younger also molds this temperament. These young workers prefer liquidity and tend to postpone subscribing to social security schemes for once they are older. This further underscores the variance between platform and traditional workers, and the need to acknowledge them as the new-age labour force.

Source: Unlocking Jobs in the Platform Economy, OMI

Taking cognizance of this unique nature of platform workers, the Government of India catapulted the country’s social security system to the 21st century, with a radical labour reform — The Code on Social Security 2020. Benefitting half a billion workers, the Code recognises gig and platform workers as an entity outside of the existing formal-informal sector. When coupled with the e-Shram Portal, meant to register informal workers, gig and platform workers among others, the Indian labour force will have access to social security that is portable and universal.

As the European Union embarks upon its legislative journey to improve the lives of platform workers, it could take a leaf from India’s book and acknowledge the uniqueness of platform workers. In doing so, it can empower students, formal/informal workers, unemployed youth and many others by giving them the option to choose platform jobs as an additional label to their existing worker status, and making social security universal and portable, without a trade-off with choice of work. Indeed, flexibility and employment status may not be considered mutually exclusive. However, the changing future of work must be acknowledged by reshaping legislations to fit the new-age workers and not the other way around.

The opinions and views expressed in this publication are those of the authors. They do not purport to reflect the opinions or views of Reshaping Work.