The Gig Economy – Resolution Foundation | Nessa of Two Evils

In this new, potentially one-off, blog post, tentatively categorised under The Westminster Puddle (am I really bursting a bubble here?), I am going to summarise the seminar by the Resolution Foundation I went to this morning. This is something I do for work anyway, as research for my role, and this way you know as much as I know.

The Resolution Foundation’s seminar was planned around their latest publication A tough gig? The nature of self-employment in 21st Century Britain and policy implications. The speakers were

  • Matthew Taylor, Chief Executive of the RSA
  • Andrew Byrne, Head of Public Policy at Uber UKI
  • Judith Freedman, Pinsent Masons Professor of Taxation Law at Oxford University
  • Viktor Calabro, Chief Exec of Coople

and the discussion was chaired by Torsten Bell, Director of the Resolution Foundation.

Torsten Bell presented the key findings from their report to set the scene, and then the discussion began with opening 5 minute remarks by all speakers.

Matthew Taylor is currently leading the Government review on the nature of employment, and talked about how they were looking to improve conditions for the self-employed (pensions, maternity pay, paid sick leave etc), but stressed that they had no remit over tax changes (something Torsten alluded to as being key). A suggestion he mooted was what if we were only able to employ directly through an accredited platform to avoid exploitation of workers and the self-employed?

Judith Freedman mentioned that the “lobby” of self-employed felt that they were taking on a risk by being self-employed, and thus that taxation should benefit them (corporate tax and dividends tax is exponentially financially more expedient for the self-employed). However Judith disagreed with that assessment, saying that non-direct or non-financial support would be better, and eventually even the self-employed would suffer from the decreasing corporation tax through levies raised with other taxes. She thought tax definitions of employment needed to be separated from rights-based definitions of employment, which currently are ambiguous and potentially unhealthily related.

Andrew Byrne spoke mainly about the advantages that Uber brought those who wanted flexible employment, and other benefits (Uber pays for annual professional development/qualification, for example). He mainly suggested companies can do very little except ask the government to provide clarity for the labour market. An interesting point he raised additionally was that points that Uber drivers previously complained about, such as not knowing the pick-up point or destination of the next ride the accepted, were apparently based on the intention to avoid discrimination (avoiding rough areas, or short hauls as examples).

Victor Calabro is the Chief Executive of a Swiss company, which, as I understood, provides a platform for the self-employed of his country to find work. He brought up that in his country, employers are required to verify self-employment status of those contracted for work, and also stressed the benefits of flexible work

This was followed by a Question and Answer segment, dominated in responses by the male panelists.

On corporate governance: Matthew does not believe workers on boards are the best solution for representation, and instead believes in intermediate levels of governance, such as feedback panels. Currently he knows this practice is not effective to the degree he hopes, but he believes that the more this practice is employed, the more effective it will be – not within an organisation, but seeing the big picture.

Andrew implied that Union-style organisation of Uber drivers was not necessary, as they had the ability to organise and feedback to corporate through processes and platforms online – like chats, podcasts and forums. This enabled Uber to debunk “myths” about corporate practices as well.

Note that profit is not included in mean annual income
(Credit goes to the Resolution Foundation)

On the financial benefits and draw-backs of self-employment: Resolution Foundation will continue this line of research – primarily into the disparity between growth of self-employment but fall in wages/salary of that working population segment.

Torsten previously touched upon how the National Insurance Contributions cover NHS funding to a substantial degree, which self-employed workers do not pay, creating a funding gap given that self-employment is on the rise. However there is also little-to-no trickle-down effect of self-employment: few who are self-employed employ others.

On best practice abroad: Victor clarified that the Swiss verification process did involve checking with government bodies about self-employment status, and mentioned that this was sector-specific (for example, a plummer had to certified for self-employment as a plummer, but if he wanted to branch out to carpentry, would have to go through the certification process again).

On Brexit: Torsten maintained that an important discussion was not currently had. While people were panicking about what the possible negative or positive effects of Brexit would be, the reality of where foreign workers would come from was not being tackled – his example was that Romanian carrot pickers were unlikely to be available for the next harvest, so were people deciding to build carrot-picking machines or something else?

(Credit goes to the Resolution Foundation)

On labour market changes: Torsten also mentioned that this debate was about the fundamental question of what kind of labour market we wanted, taking Uber and its responsibility to its drivers as an example with the Employment Tribunal. If the ruling said the drivers were workers or employees, it would have ramifications of product cost, which the rest of the industry would have to follow.

Matthew felt that the labour market was not open to those beyond pension-age (termed “leisurely” workers) as they would not be as productive as other workers, so would not be worth minimum wage to companies. How could this be reconciled without legal loopholes?

Victor spoke of workers comparably to energy supply: we need stable availability of workers on regular contracts, supplemented by casual workers with on-demand shifts. According to his research or anecdotal evidence, more workers wanted flexibility than regular hours, which then made for better business as complete coverage was ensured, at lower costs (less hours per person, so less “full-time work”, meaning fewer breaks, more productivity etc).

Matthew finished with an endorsement of the government to match-fund self-employed pension contributions.

(Photo credit goes to the Resolution Foundation)


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