The Future of Work: Using the Gig Economy to Your Advantage

 
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Originally posted on Seyfarth Shaw Australia’s Workplace Law & Strategy blog.

As was recently discussed in our “Work: The Future” event, one of the more interesting recent developments in relation to work has been the continual rise and development of the gig economy — that is, workers developing niche areas of specialist expertise, but having careers characterized by a series of interactions with various organizations, rather than being employed by one company for many years. This doesn’t just mean a person working in multiple jobs over the course of their life, but that they are much more likely to be running their own independent business providing services to customers.

Over the last 15-20 years, many businesses have made the distinction between core and non-core functions, using that distinction to drive and make judgment calls about the nature and form of their relationships with those contributing to their business (including employees, contractors, suppliers or others). With the development of the gig economy, businesses will need to be more sophisticated in their analysis, taking a much more fundamental and holistic view of how they want the business actually to operate — entrepreneurs, leaders and managers need to consider how the emerging gig economy will impact on the structure of the business’ relationships with its contributors.

So, how can your business make the most of the opportunities that a gig economy offers, while also managing the legal, reputational and business risks of dealing with multiple independent contractors?

Employment and industrial law may be slow to catch up with these developments — indeed, it has only been within the last five to seven years that the industrial tribunal in Australia revisited the whole way in which awards work (with the result that a simplified system has been developed, albeit one still focused on a traditional employment model). But sophisticated businesses with an eye on long-term success will be looking at a range of issues now to make sure they are ahead of the gig movement:

  • How to ensure that customer experience (“CX”) remains consistent over time if customers interact with different personnel each time (perhaps, for example, by using CX metrics as part of the contractor reward system).
  • How to ensure that the business is properly resourced and able to respond to urgent customer demands with a workforce that does not necessarily have any particular loyalty.
  • Which labor markets the business will use to source gig workers — will we have a “Beta vs. VHS” winner or live with an “Apple vs. Android” solution? Will the business accept the standard terms associated with using markets like Airtasker, an Australia-based task-outsourcing service?
  • Whether to develop a standard form for the engagement of contractors/gig workers, and how to ensure that the right type of engagement is used in each circumstance.
  • How safety systems and processes need to adapt as the pendulum swings from workers being employees to workers only lightly touching the periphery of the business from time to time — will you need to re-evaluate your risk profile?
  • How the legal risks associated with gig workers are managed and ensuring that systems insulate the business as far as possible from legal claims, such as sham contracting.
  • The increased interest by regulators in how businesses are interacting with their workers.
 
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