Across the world today, many workers find themselves without protections and benefits. Most social-protection systems were created with a single, stable, full-time employment relationship in mind.
In the past 20 years, technology has reshaped work, the workplace and the role of workers. New technologies have enabled novel business models, such as digital labour platforms (DLPs), to thrive. DLPs leverage the internet to connect workers with paid tasks, often facilitated by algorithmic tools and a flexible workforce. Location-based DLP tasks might include grocery delivery or ride hailing while online-based DLP services could include graphic design or translation.
By maximising efficiency, information aggregation and flexibility, they have created value for workers, customers, businesses and economies, sometimes in ways we might not expect. While there are sometimes shortcomings and challenges to achieving these positive effects – especially for workers – governments must acknowledge the value that DLPs can provide.
Yet the way that governments have approached DLPs to date has often failed to consider their actual and potential benefits or to factor in worker preferences. Combined with a polarised public debate, this means that governments have focused on negating perceived harms at any cost, up to and including bans or de facto bans. Some governments have been content to ignore the emergence of DLPs, creating uncertainty around particular aspects of the work, including the employment status of workers, sometimes leading to litigation.
Policy responses too often miss something important: the views of the workers who actually use DLPs. To help fill this gap, the Tony Blair Institute for Global Change commissioned new, unique user-centred research to generate insights drawn from DLP workers’ lived experiences. This research focused on participants in London, Jakarta, Nairobi and Singapore and revealed that, while specific experiences vary greatly from user to user and between locations, we can draw several clear and common insights.
The key finding is that, across different locations and platform types, DLP workers’ perceptions of good work are framed by control, flexibility and a decent income. Platform work was a positive choice for most workers. In many cases workers commented that they are more likely to achieve what they define as “good work” in platform work than in traditional employment.
This does not imply that there is no scope for reform. While many workers experience these elements of good work, in many cases more can be done to improve workers’ experiences. Workers’ sense of control can be undermined by a lack of clarity on how decisions are made and an inability to react to automated platform decisions or to influence the way in which these decisions are taken. Research participants cited discrimination and unexpected costs as factors that hinder their earning a decent income, as well as highlighting a lack of flexibility – seen as the ability to manage their work around their life – because of these factors.
Overall, governments have done too little to harness the best of what DLPs can deliver and not enough to support the people who are keen to use them. Regulating DLPs out of existence would have a negative impact on workers and the economy. Rather than simply tolerating DLPs or locking them into traditional labour patterns, governments must reform systems so that they take account of DLPs.
To better serve worker needs around control, income and flexibility, governments should consider how they can achieve these three policy outcomes when regulating DLPs: to empower workers, encourage platform competition and extend the benefits of DLPs.
First, governments should empower DLP workers with basic regulatory rights and protections without undermining the DLP model by forcing a change in workers’ status. This means introducing a core set of rights for everyone engaged in work, regardless of status (such as those proposed in TBI’s paper A Fair Deal for All). This would also support those in non-digital forms of non-traditional employment (for instance, those on zero-hours contracts) who can face similar risks and challenges as DLP workers. These minimum rights should take into account and be tested against specific negative features of some DLPs, such as unfair geographic restrictions and discrimination or software errors that can lead to underpayment.
Second, they should ensure that the policy and regulatory environment encourages platforms to innovate and improve conditions for workers. This can be done in two ways: by creating competitive, fair markets, which is a priority for workers in our research, and by making it easier for workers to switch easily between platforms by lowering barriers to combining work, transferring their data between platforms and accessing information about platforms.
Finally, once worker protections and fair market conditions exist, there is an opportunity for governments to extend the benefits of DLPs to more workers, for instance by providing the necessary resources to lower barriers to entry for potential DLP workers.
Note on the Research and Policy Process
This paper is part of a series of research papers by TBI on digital labour platforms globally.
It builds on our literature review “Making It Work: Understanding the Gig Economy’s Shortcomings and Opportunities”, which was published in April 2022. As outlined in this publication, variations in worker characteristics, platforms and geographies help to define and mediate the experience of work on DLPs. This brings challenges for both research and policy.
At the research level, the plurality of workers, platforms and environments makes it difficult to generalise the experience of workers. To overcome this challenge, the “Control, Income, Flexibility: Workers’ Perceptions of Good Platform Work” chapter of this paper draws out similarities and differences in the experiences of workers across different locations and on different platforms.
At the policy level, our literature review highlighted that “blunt or sweeping changes” to regulation may end up protecting certain groups while harming others. The “Governments Must Empower Workers, Encourage Platform Innovation and Improvement, and Extend the Benefits of DLPs” chapter of this paper outlines general policy outcomes for workers on different platforms. The specific measures that will best support these outcomes will vary from country to country.
We aim to build on this set of high-level policy outcomes, to explore specific policy programmes for select geographies to serve as case studies during the next phase of our work.
Source: International Labour Organisation; Online Labour Observatory; European Commission; JP Morgan; Insight2Impact; London School of Economics; Tony Blair Institute; NITI Aayog
Across the World Today, Many Workers Find Themselves Without Protections or Benefits
A full-time job, working 9am to 5pm, Monday to Friday, may still seem like the norm for many people. However, for some, such as those in the informal economy, this does not reflect their work life. Globally, “non-traditional” forms of work are a common and growing part of the labour market.
As many social-protection systems were created with a single, stable, full-time employment relationship in mind, many of those in non-traditional work are not protected against losing their jobs, or a reduction in income or injury at work, and are also denied access to social-assistance programmes or pension benefits. In addition to social protection, workers can often lack the security of occupational health and safety, working-hours regulations and anti-discrimination policies.
Technology Has Reshaped Work, the Workplace and the Role of Workers
Technology has impacted work in large part through the automation of jobs and the augmentation of human activities. These changes have altered both the type of work done and the worker experience. Driven by the need for business efficiency, algorithmic systems are being deployed by businesses in a variety of sectors to make decisions about how work is being allocated, matched, remunerated and assessed.
But technology has also drastically affected both the access to and the supply of labour. Over the past 20 years, there has been a significant growth in access to mobile equipment and connectivity, coupled with more affordable cloud technologies. These trends have been linked to a rise in digital outsourcing, remote working, and the use of digital platforms.
Within this context, DLPs have emerged. DLPs act as intermediaries between the supply of and demand for labour. While the matching of worker to client is digital, work can be undertaken virtually or physically. Even within these categories, there are variations in worker characteristics and the nature of platform work, helping to define and mediate the experience of work on DLPs.
Platform work on DLPs is often (but not exclusively) short-term, on-demand work mediated digitally, with workers typically paid per task, and most workers contractually classified as self-employed or independent contractors. DLPs usually serve as intermediaries in the remuneration of the worker by the client and make their money by charging a commission. Although DLPs still represent a small section of the working population, millions of workers have joined platforms across the world in the past decade (Figure 1).
Key players in the gig economy
*The term “worker” is used in the general sense, rather than relating to a specific legal classification.
Source: Schmidt 2017[_]
Overall, there is evidence of a net-positive effect of DLPs, especially in developing economies. By maximising efficiency, information aggregation and flexibility, DLPs have delivered increased sales, more choice and greater convenience for customers, as well as lower barriers to access work opportunities for a variety of workers, including the unemployed or those who may not be able to take on a full-time or fixed-hours job. They can also help to build stakeholder trust with regard to payment and can onboard workers to government support schemes. As such, they can fill institutional gaps that governments have been unable to bridge. In this way, they create value for workers, businesses and governments compared with traditional forms of employment.
There are sometimes obstacles to achieving these positive effects, especially for workers. The task for governments is to identify and mitigate the most serious challenges while retaining the benefits of the DLP model.
Designed for the first wave of globalisation, the international labour-governance system has not kept up with an increasingly digitised and fragmented world of work. National regulations have struggled to hold to account the platforms that engage in the global labour market, and attempts to regulate DLPs have been few and far between.
Some reasonable protections for platform workers have been created. For instance, some countries have legislated or ruled in national courts that the minimum wage should apply to some or all platform workers. This has helped to protect workers, especially during recent periods of high inflation.
However, in general, governments’ responses have suffered from three flaws. First, governments have lacked an understanding of the unique features of DLPs, and so many were content to ignore the emergence of these platforms rather than anticipate the challenges that they present to the traditional concept of worker rights and regulation.
This has created uncertainty and, in some cases, led to litigation, especially in relation to the determination of worker status.
Second, where governments have started to address platform work, the focus has been on negating perceived harms without recognising the benefits of DLPs to citizens and economies. For instance, some interventions have focused on the extension of the specific benefits of traditional employment and protection of existing markets.
Third, there has been a lack of insight into worker preferences. Where governments have intervened directly, the focus has been on applying existing models of worker rights and concepts of “good work” without considering the reasons people choose to work on DLPs. A common regulatory response has been to require the reclassification of DLP workers as employees, but this has caused poorer outcomes for gig workers, protests by platform workers, and the withdrawal of platforms from some markets altogether.
The absence of a voice for so many DLP workers risks governments enacting poor policy responses – often based on traditional assumptions about what “good work” is – that can fail to serve the workers they wish to support. This does a disservice to platform workers, and so we commissioned a unique participatory study across four research locations on three continents: Singapore; Jakarta, Indonesia; Nairobi, Kenya; and London, UK.
Through our research partners, we spoke to 57 workers. We were especially interested in any common themes that would be relevant to policymakers across a broad range of economic and regulatory contexts. The interviewees came from a range of backgrounds and experiences with both online- and location-based DLPs. This sample of emerging and developed economies allowed us to compare perceptions across different labour-market configurations. Needless to say, the design and operation of platforms varies greatly, and no two individuals have exactly the same experience. Nevertheless, we were able to identify some common themes.
Workers Join Platforms in Pursuit of Control, Income and Flexibility
For most workers, platform work was a positive choice compared with formal employment or, for some participants in Jakarta and Nairobi, no work at all. Our research found that across all four locations and across different types of platforms, worker perceptions of “good work” were framed by three considerations: control, income and flexibility.
Control: most workers went into platform work to have more influence on their earnings, time and opportunities.
Income: workers saw platforms as an opportunity to earn a higher income than with other available options, with many pointing to earning multiple streams of income as a key reason for choosing platform work.
Flexibility: workers wanted to manage their work around their lives, making space for hobbies, responsibilities and leisure. Many cited more family time as a benefit of going into platform work.
The control, income and flexibility (“CIF”) framework
Online-based DLP workers prized the ability to “pick and choose” particular jobs and have control over one’s own “work rhythm”. Location-based DLP workers extolled the virtues of being able to “shut down the app at any time to take offline jobs”, “unbound by the pressures and constraints of a conventional 9-5 office job”. Workers find this sense of control empowering, with one driver in Singapore noting: “I do not want to be owned by an employer”.
Alongside this sense of control, workers reported that DLPs provided them with higher earnings than the alternatives and were in many cases a more reliable source of income. For those engaged in DLP work, immediate income was more important than securing future earnings (whether in the form of retirement savings or investments into upskilling).
A decent income earned on a worker’s own terms meant they felt able to achieve greater levels of flexibility in combining their work and private lives and maintaining a schedule that suited them best. The ability for DLP workers to make these choices (“I can cook first, feed my kids, and be temporarily off when I need to go home”) compared favourably with the constraints of a traditional job with set hours. As one worker put it: “This is my freedom job”.
The ability to combine control, income and flexibility is a unique selling point for people who want to engage in platform work. However, participants also shared experiences that fell short of meeting the promise of DLPs.
Lack of Transparency and Recourse Undermine the Sense of Control
DLP workers can struggle to assert control over their working lives when they come up against a lack of transparency around decisions made by an algorithm that cannot be challenged or reversed.
Some DLPs collect and use data in algorithms that affect pay, allocation of work and rewards or disciplinary measures. Without a good understanding of these processes, workers can miss out on opportunities to access work or maximise their income. Their frustration is not with algorithmic management as such, but rather with the lack of knowledge to inform their decisions (“Just tell me how [algorithms] affect my earnings so that I can adjust accordingly”).
Automated decisions that punish workers, such as suspensions, greatly impact their sense of control but can be difficult to dispute. This can leave workers with a profound sense of unfairness, making them feel as if they were “guilty until proven innocent”. Workers can feel they have no recourse and are in the dark on “how the platform handles disputes”.
Workers advocated for changes to platform practices that give them “easy communication access with the platform to resolve issues” and an opportunity to engage with potential decisions before they are taken (“a chat or email to clarify”). In Nairobi, a “WhatsApp group of female drivers” which included “the [platform’s] CEO” was created. Workers in this group felt “able to raise issues” and were confident that they would be “sorted”.
Workers felt particularly strongly about decisions based on customer complaints, whose interests they thought were prioritised (“It’s not a balanced relationship: the driver is always in the wrong and the customer is the king”). This went against the sense of ownership that workers sought through DLP work.
Discrimination, Unexpected Costs and Platform Errors Threaten Incomes
The price of services is one key factor that affects the incomes of DLP workers. In our conversations, workers reported several challenges. On platforms that allow customers to set their own fees (primarily on online-based DLPs), workers from Jakarta and Nairobi have faced price discrimination from customers who “tend to think we do not know or understand English hence we get fewer tasks and low-paying jobs”. Workers on web-based DLPs have also seen their access to jobs limited based on geography, resorting to masking their location through virtual private networks (VPNs) or asking associates in other countries to open accounts on their behalf to access a platform.
Variations in the balance of supply and demand can affect incomes, particularly when platforms fail to adequately match the supply of workers to the demand for their services. This can lead to financial losses for workers when “income for the day [is] not enough to cover the fuel and meal costs”.
Commission fees charged by the platform are another cost for DLP workers. While workers recognise that this is balanced by access to a wider pool of customers, some highlighted the lack of consultation on fee levels and the impact of unexpected increases following the pandemic.
Protections for workers who fall ill or get injured is a concern, especially in areas without universal health care. Workers cited a lack of insurance as a source of financial instability, particularly for location-based workers, for whom an injury could mean weeks of lost income. Although some platforms offer employment-injury insurance, workers mentioned that claiming it can be “very frustrating”.
Many platforms recognise the importance of offering attractive terms to workers and one finding from our research is that workers saw healthy competition between platforms as a significant driver of improvements to their pay and conditions.
A final set of challenges revolves around technical issues related to payment. The amount of time it takes to get paid – whether due to platform policy or technical error – was one recurring concern, leading workers to take on credit or rely on friends and family while waiting for funds to be released. In Nairobi, some participants preferred cash to digital payments as they felt DLPs held up money transfers on purpose. In addition, errors in platform software sometimes led to fares that did not match the actual distance travelled (“fares for 3km can be the same as 1km”). Workers felt that platforms were not doing enough to mitigate the negative impact these technical issues can have on their incomes.
Platform Features Influence Flexibility
Existing literature has focused on flexibility as a key motivation for platform workers. Our research has shown the ways flexibility is linked to control and income as equally important factors.
While DLPs can enable flexible work, platform features can also limit workers’ flexibility. Some of those limits are trade-offs that platforms need to make to protect customer interests, especially when it comes to safety – such as limits on the number of jobs drivers can accept.
In other cases, specific platform features create a sense of dependence and unfairness. Changes to platform policies – for example, the removal of the ability to unbook previously booked hours – leave workers feeling “like an employee not a partner”. Customer reviews and platform ratings can put limits on workers’ perceived ability to vary work hours or cancel jobs (a web worker in London said they felt the need to be “on the phone and contactable” at all times to keep clients happy). Or, as one worker put it: “the flexibility of gig work works really well until it doesn’t”.
Policymakers Need to Take Worker Preferences Into Account
Our qualitative research was conducted with dozens of workers in four geographically distinct locations. Its findings are consistent with those of large-scale polls carried out in the US and the EU.
DLP workers’ own preferences often go unacknowledged by existing regulatory approaches to platform work. Most participants in our study made the positive choice to do platform work, some moving from employed roles, others from unemployment or underemployment (including in the informal economy). They did so for more control, flexibility and income relative to their previous situation.
However, many of those workers are clear that the reality of platform work sometimes falls short of the desired outcomes. Governments have a role to play in making the platform economy work for everyone.
Governments need to improve the working conditions of those engaged in platform work, and to better serve worker needs around control, income and flexibility without critically undermining the DLP business model. They should consider how they can achieve three policy outcomes when regulating DLPs:
Empower: guarantee a minimum set of worker rights, regardless of status.
Encourage: maintain a competitive market where workers can move freely between platforms.
Extend: support a vibrant and varied DLP ecosystem with lower barriers to entry for workers.
In the following section, we provide some examples of existing interventions found globally.
Empowering Workers With Basic Regulatory Rights and Protections
In recent years, some governments have looked to safeguard the rights of those who engage in DLP work. Many have implemented protections and benefits that are tied to employment status (for instance, a minimum wage) and in many cases have reclassified platform workers as employees.
This approach is often piecemeal. Where governments have introduced intermediate categories of workers between self-employed and employed, workers who do not meet the definition of employees remain without protections. And where courts or governments have determined platform workers to be self-employed, workers may still be left without guaranteed protections. In these instances, some platforms have proactively sought alternative arrangements, such as the GMB union’s agreement with Deliveroo in May 2022. Furthermore, the emphasis on legal status can inhibit platforms that want to voluntarily improve the terms and conditions they offer workers, in case the improvements form the basis for a legal case for reclassifying their workers.
India: Social Security Code (2020) Decouples Worker Status From Protections and Benefits for Platform and Gig Workers
In 2020, India passed the Social Security Code, a labour-reform package that assimilated 44 union labour laws into four codes covering: 1) wages, 2) occupational safety, health and working conditions, 3) social security and 4) industrial relations. By delinking benefits and social protection from full-time employment alone, and explicitly recognising platform and gig workers, the new legislation is written to protect half a billion workers, intended to give broad access to a social safety net. This project is in the early stages of implementation and the true test of its success will be whether eligible workers can access these new benefits.
Instead of imposing a binary choice between self-employment and employment and setting up a false choice between flexibility and protections for workers, governments should aim to provide a set of fundamental protections to all workers, regardless of status (such as those described in a TBI report on the modern workforce entitled “A Fair Deal for All”, which focuses on policy recommendations for the UK government). Elevating rights for all workers will also help reduce the uncertainty businesses currently face over what benefits they can provide without individual cases being litigated in the courts, which can inhibit them from voluntarily improving workers’ conditions. These rights would also support those in non-digital forms of non-traditional employment (for instance, those on zero-hours contracts) who can face similar risks and challenges as DLP workers.
A set of universal minimum rights would help to deliver positive outcomes for DLP workers. For instance, a right to representation might enable them to raise problems such as platform errors that affect the speed and amount of remuneration or non-payment by customers. The right to a floor on pay could help ensure that workers are fairly compensated for their time and efforts. A right to access and leverage their own data could help workers to analyse their own work patterns and prove their experience, making it easier for them to move or expand their activities to another DLP. A right to a review of automated decisions could allow them to challenge unfair automatic bans or suspensions.
Once these minimum rights are well-established, governments could examine whether unfair outcomes specific to DLPs persist, and if so whether targeted additional regulation is warranted.
In order to enforce these minimum rights, it is important that workers understand their entitlements and have ways to seek recourse from platforms. In addition to the right to representation, an ombudsman or dispute-resolution facility could be established to arbitrate between platforms and workers where formal representation does not exist or is not appropriate. This would provide a valuable intermediate step to help avoid lengthy and costly court battles.
Encouraging a Competitive Market to Ensure DLPs Innovate and Improve
Workers who participated in our research suggested that when platforms compete with each other, working conditions improve across all DLPs. Creating competitive, fair markets and ensuring that the regulatory regime remains friendly to new market entrants should be critical aspirations for governments in order to improve conditions for workers (see box below).
A wider choice of platforms can lead to beneficial outcomes for workers and expand access for different groups of workers. For example, some female drivers may prefer to join women-only platforms for safety reasons. By contrast, when platforms engage in a “winner-takes-most” competition dynamic, they tend to capture an increasing proportion of the value they generate, with higher prices, lower wages and less incentive to innovate their customer- and worker-facing services.
Singapore: Regulations to Support an Open and Innovative Point-to-Point Transport Industry
In 2018 the ride-hailing company Grab merged with its closest competitor, Uber, in Singapore, effectively increasing its market share to 80 per cent. The competition authority found that Grab increased fares and hampered the expansion of potential competitors, while forcing exclusivity requirements on drivers, decreasing financial incentives and increasing commissions charged. The merger was found to infringe the Competition Act and subsequently, a new transport regulatory framework that was rolled out in 2020 prohibited such exclusivity arrangements between drivers and partners to restore market contestability.
Another aspect of meaningful competition is the ability of workers to switch easily between platforms or to combine work across several DLPs. As part of the minimum rights set out above, governments should consider rights on data access and portability so that workers can more easily compare how the conditions offered by various platforms would affect them, especially with regard to consolidating and transferring essential data (such as tasks completed or right-to-work checks) between platforms.
Governments could also explore ways to increase the visibility of information about platforms to encourage worker mobility. In our research, workers often relied on friends and family to understand these conditions and opportunities, which can be imperfect in instances where individuals have few immediate connections in the platform economy.
Extending the Opportunities of DLPs to Magnify Their Benefits
Once measures are in place to provide basic minimum rights to all workers, and to promote innovation and competition among platforms, governments should support workers to engage with non-traditional work sources such as DLPs with confidence. For instance, governments can provide necessary resources, including encouraging tailored financial products and providing training for existing and potential platform workers.
For individuals who require targeted support, such as the unemployed, the government could provide equipment and connectivity support through engagement with employment, digital-literacy and financial-inclusion programmes where platform work is an outcome. Far from being undesirable or a last resort, platform work could be viewed by policymakers as a viable and potentially advantageous option, including for groups that may otherwise be less able to access the labour market.
Finland: Artificial-Intelligence-Enabled Job-Market Platform as a Springboard to DLP Work
In 2022, the Finnish government launched Job Market Finland, a new digital-service platform for jobseekers and employers. The artificial-intelligence-driven platform enables jobseekers to create anonymous job-search profiles, and have their competencies matched with suitable jobs and employers, including DLPs. It acknowledges that different people have different expectations about work and supports job-seekers with a variety of work options.
Any policy approach to DLPs must move on from an assumption that policymakers know what workers want based on old models of work. Our research has made a start in giving platform workers a voice; governments would do well to build on this.
Our research has shown that while DLPs can offer workers greater control, income and flexibility compared with alternative work opportunities, they can sometimes fall short of these desired outcomes, leading to a loss of time and earnings, among other drawbacks. Government intervention is warranted to protect workers against the most severe risks.
Given the rise and popularity of non-standard forms of work facilitated by technology, governments should not be content to ignore or restrict DLPs. Rather, governments should strive for outcomes that empower workers with basic regulatory rights and protections; encourage platforms to innovate and improve conditions for workers; and extend the benefits afforded to platform workers. Ultimately, this would not only benefit platform workers today, but also the workers and business models of the future.
The specific policies that would enable governments to achieve these outcomes will vary significantly by country, depending on existing regulatory regimes and labour-market conditions. Our aim for the next phase of this work is to define specific policy programmes for select geographies. We invite our readers to contribute to this conversation.
The authors wish to thank the individuals and organisations who took the time to help inform this report. We are particularly grateful to the following individuals who reviewed and commented on drafts of our final publication:
Adrian Haro, The Workers Lab
Amanda Goh and Lukas Aaron Pilgram, Delivery Hero SE
Chhavi Banswal and Aishwarya Raman, OMI Foundation
Jake Love Soper
Dr Mathew Mathews, Institute of Policy Studies, National University of Singapore
Paul Bedford, Rebecca Baier and Edward Roberts, Deliveroo UK
Robert Torvelainen and Samuel Laurinkari, Wolt
Shakhlo Kakharova, Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ)
Kyoungmi Oh, Open Net Korea
Special thanks to ThinkPlace and their research partner Lokal Insight, who, across many months provided a sterling and professional service. The insights they uncovered were invaluable to the formation of this report.
Asaph Change, ThinkPlace (Kenya)
Brittany Thurston, ThinkPlace (UK)
Cheryl Lim, ThinkPlace (Singapore)
Debbie Ng, ThinkPlace (Singapore)
Olivia Okeno, ThinkPlace (Kenya)
Samantha Low, ThinkPlace (Singapore)
Matulandi A Tene, Lokal Insight (Indonesia)
Meylisa Lumban Gaol, Lokal Insight (Indonesia)
Yudan Sugiharto, Lokal Insight (Indonesia)
Lead Image: Getty Images