Compensation Not Competition: Government extends reforms on gig economy to compensate workers for cancelled shifts

August 7, 2019

2 min read

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What's going on here?

The Government has announced plans to expand on previous reforms to allow gig economy and zero hours workers to be paid compensation when their shifts are cancelled at short notice.

What does this mean?

The term ‘gig economy’ is connected with short term contracts, freelance work and flexibility. Furthermore, this type of work is often juxtaposed with the more traditional labour market in which workers have ‘permanent’ positions.

Zero-hour contracts concern situations where an employer is not obliged to offer work and the employee also has no obligation to take on work requested.

The Government’s proposals, as part of their Good Work Plan, will build on reforms introduced in December 2018 which included giving these workers the right to be told of their rights immediately and allowing them to request more predictable hours. The new proposals go one step further and posit that gig economy workers should be able to claim compensation in the event of short notice cancellations and will also provide protection to workers who do not accept shifts offered to them at short notice. It is hoped that this new legislation will take effect from April 2020.

What's the big picture effect?

In light of the nature of the gig economy in which workers go from ‘gig’ to ‘gig’ and get paid in this cycle, cancellations at the last minute can have a detrimental effect on the worker. Moreover, as this form of work is particularly appealing to younger adults, the effect can be even more adverse.

In the view of Business Secretary Greg Clark, these new business models have opened up a ‘whole new world of working patterns and opportunities’ and Bryan Sanderson (chairs the commission) has stated that these changes ‘have the potential to improve work and life for hundreds of thousands of people’.

Although these further changes are a step in the right direction and acknowledge the importance of the gig economy and the modern working environment, it has also been argued that they do not go far enough in protecting workers. Frances O’Grady, General Secretary of the Trades Union Congress (TUC) has likened the position of zero hours contract workers to having ‘no more leverage than Oliver Twist’. This is given credence by the fact that many are being ‘forced to take on casual and insecure platform work- often on top of other jobs’ in order to support themselves financially. This suggests that the government is still a long way from offering all workers the protection that they deserve.

Report written by Natasha Dawes

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