Collaborative economy report response: June 2018

4. Working In The Collaborative Economy

4.1. Fair work

4.2 Employment Status

4.3 Voice and collective bargaining

The Panel highlighted how the collaborative economy has changed the world of work. It highlighted the debate around employment status and the definitions of employee, worker and self-employed. The Panel considered the ‘gig economy’ where digital platforms let people access casual or freelance work, dominated by lower skilled labour. The Panel took a wide perspective of rights and responsibilities while recognising that ride sharing, taxi and private hire plays a significant role in this sector.

The Panel recommended:

• The principles of fair work in the Scottish Government’s Fair Work Framework to underpin the approach to the gig economy.
• Platforms to address gaps for genuinely self employed workers in illness and injury cover, and platform workers to have an effective voice.
• The work of the Panel to continue by bringing together the Scottish Government, the Fair Work Convention, trade unions and platforms.
• Workers in the collaborative economy to have a voice to influence their working conditions and pay.

Scottish Government response

The Scottish Government welcomes the Panel’s recommendations which seek to improve the quality of work in the collaborative economy and enhance the rights and protections of its workers.

The world of work is changing and it is clear that employment practices and the legislative framework need to adapt at a similar pace to ensure workers’ rights are protected and enhanced. While employment law is reserved to the UK Government, the Scottish Government is continuing to use all the levers available to us to ensure that our labour market is successful, resilient, inclusive and fair.

Scotland’s Labour Market Strategy ^[5] sets our vision for “a strong labour market that drives inclusive, sustainable economic growth, characterised by growing, competitive businesses, high employment, a skilled population capable of meeting the needs of employers, and where fair work is central to improving the lives of individuals and their families”.

The Strategy highlights action to ensure that every person, regardless of background, has the opportunity to access quality and inclusive education, training and lifelong learning. This in turn will enable every person to participate in the labour market and in the wider society.

While technology is helping to create new jobs and occupations and opening up flexible working options that can benefit workers, there is a concern about the quality of the jobs.

The Scottish Government recognises that current protections for some gig economy workers are inadequate and leave many workers exposed to uncertainty over income even when they have been working for an employer for an extended period of time. We recognise that they provide limited rights in terms of sick pay, holiday pay, maternity/paternity leave, the risk of no work being offered, or work that is offered being subject to availability. Such conditions fail to realise the value and potential of people in the workforce.

It is our view that all workers are entitled to a degree of protection through law, as well as to be treated fairly and have a voice in the workplace, even when that workplace is an online platform. And as Nesta ^[6] highlights, we are now seeing individual workers using the same technology as platforms to connect, support each other and take collective action for themselves, rebalancing power in favour of the worker. This is a very positive step.

We fully support the Panel’s recommendation that the Fair Work Framework should underpin work in the collaborative economy and are committed to working with the Fair Work Convention, trade unions, platforms and other stakeholders such as the Association of Independent Professionals and Self-Employed, to help mainstream Fair Work within this growing sector.

The Scottish Government’s position is that all workers should be afforded suitable and appropriate protections in accordance with the spirit of our social obligations rather than simply to ensure compliance with the law. As the Panel has noted, the UK Government has committed to addressing the ambiguity of employment status following a recommendation from the Taylor Review. It is vital that any consequential changes to employment status should focus on improving clarity for workers and should seek to extend and improve statutory rights and protections for those in precarious work. The Scottish Government will engage with the UK Government to ensure that any proposed changes to employment law will enhance protections for workers in Scotland.

Next steps

• We have committed to developing a Fair Work Action Plan by the end of 2018 to deliver our ambition for Scotland to
  be a Fair Work Nation by 2025.
• In developing the Fair Work Action Plan, the Scottish Government will engage with the Fair Work Convention, trade unions and platform hosts to help employers within the collaborative economy understand and embed the dimensions of Fair Work in their organisations. The Fair Work Action Plan will include actions specific to the collaborative economy.
• To support the process of embedding fair work in the collaborative economy, we will invite the Fair Work Convention to consider using its convening remit to engage with stakeholders involved in platform working to assess the implications of the gig economy for fair work and the implications of fair work for the gig economy.
• We will continue to work with the Scottish Trades Union Congress to support the training and education of workers, focusing on those involved in precarious employment. In 2018/2019, funding will be provided through the Trade Union and Fair Work Modernisation Fund for organisations in the collaborative economy which apply the Fair Work Framework.
• The Scottish Government will work collaboratively with trade unions and partners to develop online guidance for workers seeking to gain clear and accurate information about their employment status, protections and rights.