Not too late to innovate on gig economy regulation

The government’s proposed industrial relations shake-up will provide gig workers with additional protections but misses an opportunity to move away from Australia’s adversarial workplace relations and embrace regulatory innovation, according to University of Sydney Business School expert Dr Alex Veen.

In his submission to the Senate Education and Employment Legislation Committee Inquiry on the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023, Dr Veen supported efforts to improve conditions for ‘employee-like’ gig workers.

But as the government negotiates changes to the bill, he suggests there may be more innovative alternatives that haven’t been fully considered.

“The gig economy is an important source of income for people from traditionally disadvantaged groups, including migrants, people with a disability or caring responsibilities, and older workers,” Dr Veen said.

“As things stand, these workers are at the mercy of the market as platforms attempt to keep labour costs down, have little capacity to challenge their dismissal from the platform, and have high instances of workplace injuries – all issues that the Closing Loopholes Bill addresses.

“The problem, however, is that the government has opted to effectively mimic an enterprise bargaining system that hasn’t been delivering, and which has contributed to a culture of adversarialism. In particular, the expanded role for the Industrial Relations Commission should be questioned.”

Dr Veen argues that rather than forcing the parties to rely upon the Commission for decisions they will invariably disagree with, there is an opportunity to shift the responsibility by experimenting with industry self-regulation.

“If this fails, regulation can then always be brought in – but examples such as the success of self-regulation in the Dutch temporary staffing sector suggest that such approaches can be highly successful.”

Dr Veen said the real risk with the proposed jurisdiction is that any collective bargaining efforts may be undone by prescriptive minimum standards orders.

“Why would digital platforms invest the time, energy and resources into establishing a collective agreement when minimum standards orders prevail? This approach effectively recreates the adversarial enterprise bargaining system for gig workers, with all its deficiencies.

“The government has an opportunity to learn from a more successful approach and empower the industry to proactively develop its own solutions, rather than rely on the Commission to set the agenda.”

The authors declare no external funding or conflicts of interest related to this research.