Labour eyes stronger employment rights for precarious ‘gig economy’ workers

Labour is looking at extending employment rights for workers in the so-called "gig economy" under plans detailed in a new think-tank report.

Precarious workers like Deliveroo riders and Uber drivers would get the same rights as other employees and have their rates set by collective bargaining, under the proposals being examined by Ed Miliband.

While the party’s final policies are yet to be decided, the shadow business secretary said new blueprint drawn up by Common Wealth contains “useful insights” into how workers’ rights could be extended.

Many workers currently miss out on basic employment rights because firms have successfully argued in court that they are in fact self-employed – a loophole that leaves them without holiday pay and even minimum hourly wages.

"There is nothing innate in the concept of the platform that means that work organised through it should be precarious, badly paid, or lacking in control," the Common Wealth report argues.

Pinpointing "a weakness of regulation and the wider power imbalances" in the labour market, the think-tank recommends closing the loopholes exploited by tech companies to run down pay and conditions for workers on their platforms.

It says this could be done by creating a new "worker" legal status covering all jobs, whether agency workers, bogus "self-employed" or employees. There would be a "statutory presumption that all individuals qualify as employees unless the employer can demonstrate that they are genuinely self-employed".

This would ensure all workers enjoyed rights such as statutory redundancy pay, sick pay, maternity, paternity, and adoption leave and holiday pay – which many do not currently get.

Zero hours contracts would also be scrapped and replaced with flexible contract that guaranteed employees a minimum number of hours, based on the existing German model.

Responding to the report, Mr Miliband, who sits on the board of the think-tank, said: "Digital innovation and developing technologies offer big opportunities for society, but we must ensure that companies do not wield excessive and anti-competitive power, so that technology works for the public good.

"This report provides useful insights into key ideas and concepts, including looking at how workers rights could be enshrined in light of the changing use of data; and how a National Investment Bank could help catalyse private investment in projects focused on the public good."

The report also suggests that digital platforms like Deliveroo and Uber should be regulated like public utilities if they achieve monopoly status. It also

Mathew Lawrence, report co-author and Director of Common Wealth said: “There is nothing fixed or inevitable about how the digital economy operates.

"Though the monopoly power of the platform giants is producing a series of stark economic and social challenges, we can reimagine their power and recode how they operate. That should start with a new deal for all workers."

He added: "But we should go further. A new architecture of multi-stakeholder ownership and control, giving suppliers and users of the platform genuine voice and control, can better unlock the democratic and enlivening potential of platform technology for all.”