Poll: 56% think employers in the gig economy should provide minimum benefits

employee benefits technology

Employee Benefits poll: More than half (56%) of respondents think that employers which operate in the gig economy should be required to provide a minimum level of benefits for those working for them.

A straw poll of www.employeebenefits.co.uk readers, which received 25 responses, also found that 36% of respondents feel that employers in the gig economy should not be required to provide a minimum level of benefits just yet, as more clarification around working statuses is needed first.

A minority (8%) of respondents do not think employers in the gig economy should be required to implement a minimum level of benefits.

Employment tribunal cases in both the UK and US over the past year have raised the profile of how individuals who work in the gig economy are treated in terms of benefits and working conditions. More specifically, legal cases involving employers such as taxi organisation Uber and courier firm Addison Lee have questioned the employment status of individuals working for the organisations, in order to determine the employment rights of claimants.

For example, the organisations have been hiring individuals on an independent contractor basis. This means that the drivers or couriers are defined as self-employed for tax purposes, and also do not have access to employment rights such as holiday pay and the national minimum wage. However, claimants in the employment tribunal cases have argued that their working conditions, routines and contracts instead demonstrate an employer-employee relationship, meaning that they should be classified as workers. Workers are entitled to employment rights and would receive both the national minimum wage and holiday pay.

A report commissioned by prime minister Theresa May, The Good Work: The Taylor review of modern working practices, explored worker status as part of its remit to analyse current working practices and models to ensure they were fit for purpose within the modern workplace.

Published in July 2017, the report recommended retaining the three-tier approach to employment status, which currently includes employees, workers, and self-employed individuals, but renaming those who are eligible for workers’ rights but who are not employees as dependent contractors. The new definition is designed to reflect more casual employment relationships, such as those featured in the gig economy, while supporting those who are not genuinely self-employed.

When determining dependent contractor status, the review suggested placing greater focus on the principle of control and less on whether there is a requirement to perform work personally.

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In May 2017, Uber agreed to contribute to a range of benefits for its UK drivers. Provided in partnership with the Association of Independent Professionals and the Self-Employed (IPSE), the benefits are available to active drivers using the Uber app in the UK who have completed at least 500 trips. Drivers can access the benefits by paying a £2 weekly membership fee to the IPSE, with Uber making a significant contribution towards the cost of joining the scheme. Overall, the package is worth £8 a week.

The range of benefits includes sickness and injury cover up to £2,000 if drivers are unable to drive for two weeks or more, jury service cover up to £2,000, occupational accident cover of £300 a week for up to 52 weeks if an accident takes place during a trip or while the driver is logged in to the Uber app, and accidental death or permanent total disablement cover of £50,000 if an accident takes place during a trip or while logged in to the Uber app. Drivers can also access free advice and support on issues such as paying tax, mortgages, pensions, and saving for the future.