As the gig economy grows, the next Scottish Government should expand the rights of these precarious workers, writes Kate Campbell, SNP candidate for Edinburgh Eastern, Musselburgh and Tranent.
Eradicating child poverty is the priority for the SNP Scottish Government. Policies like the Scottish Child Payment are central to achieving it. But so too are deeply connected measures to tackle in-work poverty and make sure that people who are working are paid a decent wage.
In the UK 72% of children living in poverty have at least one parent who is in work. Over the last few years the cost of living crisis has made life harder. Prices have risen. The breaking down of the international rules based order – unprovoked wars, irrational and unpredictable tariffs – has created global instability, disrupting supply chains and international trade. It feels like we are hovering on the brink of another worldwide recession. Energy prices are set to soar further as we await the outcome of the US-Israeli war on Iran.
In this tumultuous world, the least that people need is stability in their employment.
Fair work is not just a slogan. It is a set of principles which can transform working lives. Work should offer security. It should offer respect. It should give people opportunity and a voice. The Scottish Government’s Fair Work approach aims to make Scotland a leading fair work nation. Fair Work is also part of the National Strategy for Economic Transformation. Scotland’s economic strategy recognises that a strong economy depends on good jobs.
Employment law is the UK Government’s responsibility and, to be fair, the Employment Rights Act is one rare area where the UK Government has made some progress. But workers in the most unstable, precarious and insecure work are barely covered by the new legislation. Undefined action on zero hours contracts has been kicked into the long grass until an unspecified date in 2027.
In the gig economy, workers’ status is critical to what rights they are afforded. Sick pay, holiday pay and the minimum wage are all contingent on having the right status. Self-employed people have the least rights, employees the most. The majority of gig economy workers fall into the middle category of ‘worker’ – the least well defined.
The Employment Rights Act is unclear how the status of gig workers will be determined. Unlike in EU countries where the Platform Work Directive makes a presumption of employee status, based on clear indicators, the UK continues to rely on case-by-case determination. This often requires workers to take employers to court; a high barrier for anyone, but especially someone in precarious work dependent on that employer for their income. UK growth sits at a sluggish 1.2%. Still the gig economy continues to grow – by 16.5% in the UK last year. As our economy suffers, more people are likely to find themselves transitioning from ‘employee’ to ‘worker’ status, shedding rights along the way.
One of the biggest criticisms of the gig economy is the way platforms use ‘black box’ algorithms to manage workers. HR functions are outsourced to an algorithm that has no sense of responsibility, let alone humanity, as it makes decisions about workers’ lives. It determines who gets the good jobs, who gets the bad jobs and who gets no work at all. AI is making decisions which an HR manager should be making and, crucially, should be accountable for. This ‘black box’ element means workers have no idea what factors are influencing decisions being made. It fuels a sense of powerlessness for workers, and could be masking decision-making that would land a human in an employment tribunal. Again, the EU directive will enforce transparency on algorithmic and human oversight of decision making. UK workers have no such protections.
With no powers over employment law the Scottish Government has still to find ways to fill these gaps. Through Fair Work First it uses what powers it has to incentivise employers not to use zero-hours contracts, to tackle gender pay gaps, to offer flexible work and reject practices such as “fire and rehire”. It does this by attaching conditions to public grants and contracts.
It’s hard to see too many gig economy platforms bidding for government contracts, so the next Scottish Government will have to be inventive and agile to really get to grips with the gig economy. But there are things we can do.
We know from the history of the trade union movement that voices are so often only heard when they are collectively raised. For gig economy workers, dispersed around our cities with no base, and few means of talking to each other, creating those connections is critical. And once connected they must be empowered to influence decisions which impact them.
We should consider what enhancements we can make under digital transparency laws to open up the black box algorithms to scrutiny. We must also use regulatory frameworks to push platforms to recognise the status, and the rights, of their workers. Gathering data will be critical to this. We need to understand the gig economy much better in order to regulate it.
Given that we are a devolved nation, there will be limitations on how much we can change. This is frustrating, especially when we see the choices other countries are free to make. Of course, as an independent country we could go so much further. Aligning with the EU Directive would have the added benefit of keeping Scottish businesses internationally competitive, while also enshrining workers’ rights. We have yet to see which way the Labour UK government will go in relation to the Directive, but it does not look positive. That’s why independence, and the freedom to chart our own course, must remain the number one goal.
Kate Campbell is an SNP councillor on Edinburgh City Council. As Convener of the Housing, Homelessness and Fair Work Committee, she chaired the Council’s Gig Economy Task Force.
