The unseen struggles of the gig economy

The reality is that while the onset of platform-based work has provided an opportunity for many to support their families, it also exposes them to various forms of exploitation. This vulnerability highlights a deeper issue that the South African gig economy must address, especially as the government introduces more regulations aimed at protecting workers.

The gig economy, despite its rapid growth and opportunities, presents challenges for both workers and employers. As the country moves forward with the implementation of the Employment Services Amendment Act, the conversation around worker protections, safety, and fair employment practices is gaining momentum. But even as regulations change, platform workers still face risks, not just to their physical safety, but also to their job security.

The growth of temporary work and its impact

The World Economic Forum's (WEF) Future of Jobs Report 2023 paints a clear picture of the ongoing transformation in global labour markets. It highlights the growing shift towards remote work, gig-based employment, and contract roles. According to the WEF, 44% of businesses surveyed worldwide expect to increase their use of gig workers by 2027.

While still moving at a slower pace in South Africa, this change reflects a broader, global shift where more workers are open to this type of employment. As some South Africans turn to the gig economy due to unemployment, they also face the risks associated with it. Although there are benefits, the gig economy presents challenges, including financial insecurity, lack of healthcare benefits, and safety concerns. Many workers, desperate to provide for their families, are vulnerable to exploitation.

John Botha, during the recent Adcorp Group Breakfast, pointed out the rapid growth in temporary work and gig employment, which has been reshaping the workforce landscape in South Africa. This surge in gig and temporary work also brings with it increased challenges, particularly when it comes to worker security.

As Botha explained, while the gig model offers flexibility and cost-effectiveness for businesses, it leaves workers exposed. Gig workers, classified as independent contractors, face risks such as unfair dismissal, no access to unemployment benefits, and no workplace insurance, leaving them unprotected. For platform workers, this status means they have no legal protections around fair dismissal, unemployment benefits, or access to workplace insurance, leaving them to face the unknowns of their working conditions without sufficient safeguards. This dynamic creates a need for better protections and clearer regulations for workers.

The employment services amendment act and worker protection

The implementation of the Employment Services Amendment Act represents a significant step towards regulating the gig economy and offering more comprehensive worker protections. This Act aims to ensure that platforms adhere to fair labour practices, such as properly classifying workers, providing fair compensation, and ensuring that workers have access to basic rights, including protections against unfair dismissal. While the Act is a step in the right direction, enforcement remains a major challenge.

The fact remains that the gig economy has evolved so quickly that existing legal frameworks often fail to keep pace. Informal and platform-based employment is growing at a faster rate than traditional roles, and, as a result, regulators are struggling to keep up. This leaves many workers vulnerable to exploitation and abuse. While businesses are adapting quickly to new labour market realities, the legal and regulatory frameworks must do the same.

Beyond job security and rights, the safety and security of gig workers continue to be of paramount importance. As mentioned earlier, e-hailing drivers and delivery workers face the threat of physical harm on a daily basis. Many drivers report encountering violent attacks, robberies, and other dangers while working in more dangerous neighbourhoods.

John Botha stressed the importance of addressing these safety concerns in the broader conversation around gig worker protections. For example, if a delivery driver is robbed of their vehicle or earnings, they receive no compensation, leaving them unsupported.

Another critical issue raised at the Adcorp Group Breakfast was the issue of fair dismissal in gig and temporary work. With the rise of temporary work and platform-based employment, gig workers face an increasing risk of being terminated without due process. If there are claims made by customers even if false, a worker can easily be removed and banned from platforms without any explanation, leaving them without income and with little recourse.

The Code of Good Practice on Dismissal, which was recently updated, aims to provide clearer guidelines on what constitutes fair treatment across all forms of employment, including gig work. However, the application of this Code to gig workers remains an area of concern. As Botha explained, while the Code provides some clarity for traditional employees, gig workers still find themselves in a grey area when it comes to fair dismissal and worker rights.

Striking a balance between flexibility and security

As the gig economy continues to grow, regulatory frameworks must evolve to accommodate new forms of employment while providing robust protections for workers. Businesses need to balance flexibility with fairness, ensuring sustainable employment models that protect workers. Gig workers must also be educated about their rights and potential risks.

While many workers are aware of the vulnerabilities they face, economic conditions often force them to accept exploitative work. Policymakers need to act to close legal gaps and ensure that the gig economy benefits everyone, businesses and workers alike.

The growing shift towards temporary work and gig employment, along with the insights from industry leaders like John Botha, highlights the urgent need for regulatory reform in this area. Flexibility must be coupled with fairness and security for workers. This new model of work offers opportunities for economic independence, but it also requires significant investment in protecting those who contribute to its growth.