Commentary,  Gig Economy

Uber ‘Benefits’ Plan Aimed at Forestalling Real Change

Debate over the treatment of ride-share drivers, food delivery riders, and other workers in the gig economy continues to heat up, as governments around the world enact new policies to extend basic employment protections to those workers. The Centre for Future Work is consulting with groups like Gig Workers United and Ridefair Toronto on policies to close the loopholes that currently allow gig platforms to evade normal employment responsibilities. The following commentary was written by Centre for Future Work Director Jim Stanford in response to a new initiative by Uber to offer limited ‘benefits’ to its workers.

By Jim Stanford

It is not often that employers complain about workers being deprived of fair treatment and necessary protections: usually it’s a union or an advocacy group making those arguments.  But that’s what Uber Canada did this week with an advertising blitz to promote its new ‘Flexible Work+’ proposal, through which gig workers (including people working for Uber) would receive certain, limited benefits.

The company launched a faux protest against government over what it calls “Canada’s unfair labour system in which some workers get benefits and protections while others do not.” Obviously, Uber is a big part of that problem, thanks to its own employment practices – which classify workers as contractors rather than employees, thus evading normal costs and obligations (like minimum wages, workers’ compensation, and contributions to EI and the Canada Pension Plan). Perhaps Uber should launch a ‘protest’ against itself?

Most of the specific changes that Uber says are needed to make gig work fairer – including better safety training and equipment for workers, paid sick days, a retirement plan, representation for workers, and pay transparency – could be implemented by Uber tomorrow, all by itself. The company doesn’t need to pressure government for any of this.

So why does Uber dress up this proposal as a ‘social justice campaign,’ rather than just doing it? Because if Uber unilaterally provided any of these benefits to its workers, that would undermine Uber’s specious argument that its workers are not employees. 

In fact, Uber makes the far-fetched claim that it works for the workers – not the other way around. How? Uber pretends it is not in the transportation and delivery businesses. Rather, it supplies ‘communication services’ to its drivers and delivery staff: letting them use an app to connect them with customers, who are the real ‘boss’.

This ridiculous claim is being rejected out of hand in courts around the world. Most recent was Spain, where Uber workers received official status this week as employees. Other countries have taken similar steps, gradually tearing down the façade that Uber and other gig platforms have erected to avoid their employer obligations.

To try to forestall a similar result in Canada, Uber is now pretending to care about the mistreatment of gig workers – but placing blame on the government. It is willing to provide token benefits and protections for its workers, but only if it doesn’t jeopardize its claim that its workers are ‘independent entrepreneurs’ – even though Uber tells them who to pick up, where to take them, and how much they will get paid for it. That’s why Uber wants provincial governments to clarify that gig workers are not employees. Only then, the company says, it will begin to provide some of the basic benefits and protections that are compulsory for other employers.

Most of Uber’s “Flexible Work+” plan is corporate whitewashing: vague promises to provide more training, to listen to workers’ concerns, and – gosh – being more ‘transparent’ with drivers and delivery staff about how much money they actually make (!!). But Uber’s proposal plants one very dangerous seed: a proposal for a ‘cafeteria benefits’ approach to basic entitlements, like paid time off & pensions. Instead of doing what other employers must (and just paying for those statutory requirements), Uber proposes an unspecified ‘top up’ to driver wages that would be deposited into each driver’s personal fund. Workers would then draw down their personal fund when they need it (until it’s empty, of course). That is no way to provide essential minimum employment benefits; it’s a green light for employers to evade normal obligations in return for a token contribution to individual ‘benefit funds.’ 

No worker should have to choose between sick pay and a pension or workers’ compensation. Every worker should get all of those things: that’s the whole point of minimum standards.

Nobody should be fooled that this is a genuine effort by Uber to make gig jobs fairer or safer. Rather, it’s a political campaign to forestall the real change gig platforms know is coming. Their workers deserve true rights to minimum wage, workers compensation, paid time off (for vacation and illness), and Canada Pension Plan like any other worker.

Uber’s advertising blitz also tries to construct a false dichotomy between fairness and “flexibility.” It claims that old-fashioned rules like the minimum wage don’t appreciate the need for flexibility in modern gig work, where workers can supposedly decide when they want to work. This is not believable on several grounds. First of all, Uber’s on-demand employment practices are hundreds of years old; they are not a modern innovation. And the supposed ‘autonomy’ of its workers to choose when to work is completely shaped and constrained by market conditions: that’s why Uber drivers ‘choose’ to work in busy times (like weekend evenings), not because that’s when they love to work. Finally, Uber’s workers could still be provided with basic entitlements (including minimum wage, sick days, and pensions) within the context of its current sign-on/sign-off employment system (with modifications). Other jurisdictions have proven that.

Continuing this charade of social justice activism, Uber even posted an on-line “petition” (directed to whom is unclear) calling for policies to provide gig workers with “security, protection and transparency.” I believe fervently in all those things, so I signed the petition! …which tells you something about what this ‘petition’ is worth. (The real reason I signed was so I will receive automatic updates on Uber’s future misinformation campaigns.) 

Uber’s campaign is manipulative, corporate astro-turfing. Nobody should fall for Uber’s professed concern for its workers: if Uber really cared about the insecurity and exploitations gig workers face, they’d change their practices today. Uber’s real goal is to short-circuit efforts to achieve genuine enforcement of minimum labour standards for the growing legions of gig workers who suffer intense insecurity and exploitation – but whose sacrifice merely subsidizes the owners of money-losing corporations like Uber.

For further analysis of the history and economics of gig employment please see:

Subsidising Billionaires: Simulating the Net Incomes of UberX Drivers in Australia, by Jim Stanford (Canberra: Centre for Future Work).

“The Resurgence of Gig Work: Historical and Theoretical Perspectives”, by Jim Stanford, Economic and Labour Relations Review.

Jim Stanford is Economist and Director of the Centre for Future Work. He divides his time between Sydney, Australia and Vancouver, Canada. Jim is one of Canada’s best-known economic commentators. He served for over 20 years as Economist and Director of Policy with Unifor, Canada’s largest private-sector trade union.