Unions are warning the “gig economy” is creating a new class of working poor in Australia, who don’t have access to basic work rights, or superannuation.
According to the ACTU, sham contracting and the so-called “gig economy” are taking away workers rights to convert to permanent work and to negotiate for job security protections.
Sham contracting used to pay low wages
One of the tactics used by big businesses to drive down wages and make work more insecure is sham contracting, by telling workers to go and get an ABN, and work as an independent contractor.
This means they only get paid for doing individual tasks, and do not earn sick leave, annual leave, superannuation and in many cases they earn below the minimum wage, and they also don’t have any protection from unfair dismissal.
Miles Heffernan, Director of Litigation at Industrial Relations Claims, said food delivery riders like those who work for Foodora, Uber Eats and Deliveroo, and people who drive for ride-sharing company Uber are part of the “gig economy”.
“Poverty is not innovation – these workers often work long hours just to make ends meet,” he said.
“It’s not them who are making all the money out of the gig economy, it’s the big companies behind them who use these workers as “contractors” and not “employees”, so they don’t have to pay them minimum wages and entitlements, including superannuation.
“There is a real danger that we are creating a class of working poor, who will have no way of supporting themselves when they retire.”
Uber drivers earn less than minimum wage
A recent report found Uber drivers earn on average $14.62 an hour, compared with the minimum wage of $18.29, and it’s perfectly legal because courts currently rule that drivers are “contractors” and not “employees”.
“It’s got to stop,” said ACTU secretary Sally McManus.
“We need to completely overhaul labour hire companies by creating a national labour hire licensing system to ensure they are not cutting wages and conditions.”
Deliveroo promising super for riders
Recently, food delivery company Deliveroo announced it was launching a superannuation plan for its riders, but it was described as nothing but a scam by employee groups because all contributions would be made by the worker, without the company paying one cent.
The ACTU has recently announced a campaign called changetherules.org.au to introduce more protections for workers in the “gig economy”, including the same minimum conditions as “employees”.
Sally McManus wants casual workers to have the right to convert to permanent employees after six months working with a company.
The union is currently running a huge marketing campaign, including television advertising, and is hoping the Labor party will take on much of the reform if it forms government.
“We need to change the rules so everyone has basic rights, including the right to collectively bargain,” Ms McManus said.
“Workers need protection from unfair dismissal by the host employer and the ability to bargain with the company so they can win fair pay rises and gain secure work.”
Fair day’s pay for a fair day’s work
Mr Heffernan agreed, saying a fair day’s work should attract a fair day’s pay.
“It is really short sighted to not pay these workers a decent wage, and superannuation, because in the end, we as a community will all have to support them,” he said.
“It’s not fair, and it’s got to change, so let’s hope the union campaign can have an impact in helping to get a better deal for workers in the gig economy.”
If you are not being paid your correct wages and entitlements, or are considering legal action to recover stolen wages, we can help.
Please call our team at Industrial Relations Claims today on
1300 045 466