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Economic development and employment: Fair working conditions on digital platforms

Digital platforms are revolutionising the world of work. A project is campaigning for higher labour standards and fair conditions.

© Fairwork/Rafael Vilela
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From delivery drivers to IT workers and beauticians: around 70 million people worldwide offer their services on digital platforms. The working models are more flexible than traditional jobs, but for many people they also mean long working hours, low pay and little occupational safety. The Fairwork project aims to change that – by evaluating digital labour platforms in over 24 countries. This transparency is having an effect.

Parag* can no longer imagine working as a regular employee. He used to sit in a call centre in Bangalore for up to twelve hours a day. Now he works from home as a self-employed IT specialist on behalf of Urban Company. Instead of providing him directly with work, however, the digital platform puts him in touch with various clients. He can decide for himself whether to accept or decline each commission. This working model is known as the gig economy, where workers receive orders – usually for short-term services – via a platform. Parag enjoys the flexibility: ‘With the platform, I am my own boss. There is no pressure, and no time constraints either.’

Around 70 million people worldwide work in the gig economy, ranging from IT workers to delivery drivers. What they all have in common is that they offer their services as self-employed individuals – despite often working exclusively for one platform. But how do people make a living from it? Until recently, there was no transparent data on this. Now the Fairwork project is seeking to close that gap by having researchers document working conditions on large platforms and publish results in annual ratings. The project is supported by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ). In cooperation with the Oxford Internet Institute and the Berlin Social Science Centre (WZB), GIZ is helping to fund the research and providing strategic and organisational support to expand the project. To this end, it has established networks between Fairwork and international partners from politics, business and civil society.

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The dark side of the new world of work

So what are working conditions like on the platforms? Fairwork’s findings are mixed. The platforms create jobs and lower barriers to entry into the labour market. But in many cases, they circumvent conventional labour law, since self-employed workers do not enjoy the same protection as employees. All over the world, people are working under unfair conditions: low wages, no insurance and no occupational safety. What’s more, opaquely worded contracts are weighted against the workers.

Narayan* (33) knows a thing or two about that. During the COVID-19 pandemic, he lost his job in a sewing factory. Since then, he has been driving a taxi for a large platform company in Bangalore and can barely make ends meet. During the lockdown he was unable to work for two months, yet still had to pay maintenance for the car provided to him by the platform. Even though the lockdown has been lifted, his financial problems continue. ‘To earn the same as in the sewing shop, I now work 14 hours a day. It used to be just eight,’ he says. Narayan is not alone. Many of the 1.3 million ‘self-employed’ in India's growing gig economy have had similar experiences.

A person with a mask holds a towel.

Common standards for fair working conditions

To bring such practices to light, Fairwork publishes annual ratings of the working conditions of digital platforms. The project has established five principles for fair work, developed as part of a collaborative process, which include fair pay and fair contracts. The principles incorporate the findings of the international network and the voices of workers from around the world. They provide a benchmark for fair platform work and orientation for platform workers and companies, consumers and policymakers.

In India, the project independently evaluated eleven major providers. Five of them have made commitments to improve working conditions and implemented measurable changes in line with Fairwork’s evaluation and advice. Measures range from introduction of the minimum wage after deduction of operating costs to paid sick leave and simplified contracts. These measures will benefit hundreds of thousands of platform workers across India. As Professor Mark Graham, Director of Fairwork, explains: ‘All workers, including platform workers, deserve fair working conditions. No one should earn less than the minimum wage or be dismissed without due process. In India, in particular, we have seen how some companies, motivated by their contact with Fairwork, but also as a result of efforts by the workers themselves, are rethinking their business practices and starting to introduce better working conditions in line with the Fairwork principles. The latest results show that for Indian platforms, too, there is still a long way to go to ensure basic minimum standards for decent work.’

Fairwork targets not only the platforms themselves. In cooperation with GIZ, the project produces information materials to educate workers about their rights. Training courses and advisory services improve their career prospects. In addition, GIZ is reaching out to politicians, trade unions and other stakeholders to promote better working conditions. IFAT, the Indian Federation of App-based Transport Workers, is now using the ratings in its campaigns. The findings are also being taken up in India’s parliament.

The fact that Parag now enjoys more favourable terms of work is also thanks to Fairwork’s involvement. Following direct exchanges, Urban Company gave a commitment to observe the minimum wage – after deduction of all labour-related costs. In addition, the company has undertaken to continue payments in the event of sickness. Parag is happy with that: ‘I now have more free time and still earn as much as I did at my old job.’ This proves it is possible to improve working conditions in the gig economy. Positive feedback has meant that Fairwork, with the support of GIZ, can now roll out its project across a total of 24 countries to evaluate other platforms and their working conditions.

*The names of the people have been changed by the editors at their request.

Last update: May 2022


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