Socialist Studies Socialist Studies

The Gig Economy, Zero Hours Contracts and Child Labour

The “Gig” Economy

In recent years there has been the appearance of what has been called the “gig economy”. The gig economy is a place of employment in which temporary positions are common and organizations contract with independent workers for short-term engagements, in effect, a pool of self-employed workers connected to what is called “a common placement hub”.

A study by Intuit, the business and financial software company, predicted that by 2020, 40 percent of US workers would be independent contractors. There are a number of forces behind the rise in short-term jobs but the principle factor is that with modern forms of communication, the workforce is becoming more and more mobile and work can increasingly be done from anywhere, so that job and location are decoupled.

Freelance workers can select among temporary jobs and projects around the world, while employers can select workers for specific projects from an “on-line platform” than that available in any given area. An architect in Britain, for example, can work on a project in Germany from his house never seeing their employer, never visiting the construction site and never having any physical contact with other workers – structural engineers, quantity surveyors or mechanical and electrical engineers except through the internet via a computer screen. The architect, paid mainly by the individual jobs or “gigs” via the agency’s website platform or smartphone app, just moves from one job to the next.

However the “gig” economy cannot insulate workers from the laws of capitalism with its periodic cycle of boom and bust and high levels of unemployment. For the working class sucked into the “gig” economy it more often than not makes the experience of employment that more unpleasant and transitory, for example, it is very difficult to plan ahead when there is no reliable stream of employment and income.

And working alone can lead to anxiety, loneliness and psychological problems. Then there is the contempt of employers towards the workers. Hermes couriers were paid rates equivalent to less than the minimum wage and others felt forced to work through illness and bereavement (GUARDIAN 08.02.17). Hermes turned over £433m in 2014-15 and made a profit of £29m after tax.

Workers in the gig economy find that they have few employment rights, but recently, Deliveroo drivers organised themselves in the International Workers of Great Britain (IWGB) union demanding union recognition. And in a recent employment tribunal ruling last year Uber cannot consider its drivers as self-employed and must pay them the national minimum wage.

The “gig” economy is, in fact, not new. It is a form of piece work known to Marx. In Chapter 21 of the first volume of CAPITAL, Marx dealt at length with piece-wages. In Marx’s day, piece-work was associated with the dockers, transport and tailoring. Marx saw the piece-wage as “only a modified form of the time-wage” (p.694).

Marx was to conclude:

Piece wages become, … , the most fruitful source of reductions in wages, and of frauds committed by the capitalists” (694)

As for the contractors and the middlemen, Marx was to write:

On the one hand piece-wages make it easier for parasites to interpose themselves between the capitalist and the wage-labourer, thus giving rise to the ‘sub-setting of labour’. The profits of these middlemen come entirely from the difference between the price of labour which the capitalist pays, and the part of that price they actually allow that worker to receive (p. 695)

The use of piece-work is a strategy used by employers as an attempt to depress the price of the worker’s labour-power or ability to work to below its value. Nothing much has changed in 150 years.

While employers have embraced this trend in employment it has fragmented the workforce and has made it very hard but not impossible for workers to form into trade unions and organise for higher pay and better working conditions. Yet the “gig” economy was developed in the interest of employers not workers. Workers should look to their own class interests, and politically, this means replacing capitalism with socialism.

Zero Hour Contracts

And so on to the next employment trend now taking root in the labour market: zero hours contracts. This form of employment now effects more than one million workers because businesses insist on using more and more self-employed workers and increasingly recruit workers on temporary and zero-hours contracts. These workers have become to be known as “the precariat” from a book published in 2011 by the author, Guy Standing.

The use of casual staff by large warehouse depots has been commented on recently by the Guardian. A report of 21st July 2016 found that workers at Sports Direct, for example, were not being paid the national minimum wage, and were penalised for taking a short break to drink water or for taking time off work when ill. Some female workers said they were promised permanent contracts in exchange for sexual favours.

THE GUARDIAN also heard evidence of workers at the company’s Shirebrook warehouse in Derbyshire being scared to take time off when unwell. Freedom of information requests brought to light details of ambulances or paramedics being repeatedly dispatched to Shirebrook, on many occasions responding to life-threatening cases and, in one instance, a woman giving birth in the warehouse toilet.

Trade unions were unable to play their normal role at Sports Direct – they do not represent the agency workers who form the bulk of the workforce at the Shirebrook warehouse. But the trade union Unite was able to assemble information from workers, and submitted a dossier to the Guardian with evidence and collaborative testimony on the conditions both at Shirebrook and at Sports Direct stores. In 2016,Sports Direct were forced to offer shop workers guaranteed hours after pressure from trade unions but it did not extend to agency staff.

Workers have resisted the imposition of zero hour contracts. In June 2014 workers for SCA Logistics at the Port of Tilbury, Essex, went on strike for two days against plans to bring in zero hours contracts. The employers wanted to replace the permanent workforce of 24 by agency staff on lower pay and worse conditions.

Another area where there has been a growth in zero-hour contracts has been residential care and hotels. Industries like hospitality, food, retail, care work and logistics thrive on zero-hour contracts. It means companies can respond to the very arbitrary demands of an irregular market and then force the consequences of any period of low demand onto the shoulders of the workers they employ.

The issue is not the gig economy or zero hour’s contracts but employment. Traditional forms of employment are no less secure. There is never a “job for life”, all workers are in precarious jobs because of re-organisation, re-structuring, the trade cycle and a company going bust.

All forms of employment are exploitative in that the working class not only work, what Marx called “necessary working time” but also “surplus working time”. The field of employment is always tilted in favour of the employer because capitalists own the means of production and distribution to the exclusion of the rest of society, Abolition of the wages system is the only course open to the working class.

Child Labour

According to the United Nations, there is about 215 million children work around the world, many full-time. They do not go to school and have little or no time to play. Many do not receive proper nutrition or care. They are denied the chance to be children. More than half of them are exposed to the worst forms of child labour such as work in hazardous environments, slavery, or other forms of forced labour, illicit activities including drug trafficking and prostitution, as well as involvement in armed conflict.

THE OBSERVER (05.02.17) recently carried an article about how high street clothes were made by children in Myanmar (formerly Burma) for 13p an hour. The children, aged 14 were putting in a six-day week – some living in makeshift huts – while working in clothes factories.

Low labour costs in Myanmar have encouraged international brands to switch production from more expensive countries and between 2010 and 2014 exports tripled to £787m. There are now more than 400 factories in the country, employing 350,000 people, 905 of them women.

According to the article:

…working conditions in this industry are far from acceptable. Labour rights violations are rife. Asian suppliers are setting up shop in Myanmar in an unseemly ‘race to the bottom’, pushed by foreign buyers that are eager to secure the cheapest possible prices

The response of the Western consumer is either “I don’t care; I just want cheap clothes to look pretty in” or “no politics please, I have a party to go to”.

They just do not see the future.

Free market fundamentalists often cite George Orwell’s 1984 as a critique of the state and its interference in people’s lives. Totalitarianism is associated with the state not capitalism.

"Big Brother is Watching You” is always about the watchful eye of the government ministry not the capitalist firm. Conservative so-called libertarians do not consider it their business to question the arrangements of supposedly freely consenting adults in contracts between employers and employees.

So there is silence when companies are fitting thousands of their workers with body-worn tracker devices that monitor how much sleep they have, how well they work with colleagues, and even track their body language, tone of voice or emotions.

The aim is to increase productivity, to extend the rate of exploitation and to control the workforce electronically.

According to the SUNDAY TIMES (January 15th 2017):

Among the potentially most controversial technologies are “sociometric badges” which are being tested by at least four British companies, including a high street bank”.

The credit card-sized devices are worn around the worker’s neck, analyse employers’ voices, and track movement and physical activity. This is as degrading as having to clock in-and-off work each day or having to as a supervisor for permission to go to the toilet.

And it is all to do with profit. Data from the badges is combined with monitoring the workers’ telephone calls and emails to assess their productivity and to work out how teams in the same factory or office can interact better and produce more efficiently. In a telling phrase, so-called ‘efficiency

Such is the dehumanization of employment in contemporary capitalism. There is, of course, a socialist alternative. However this requires workers to become socialists to consciously and politically end the profit system and establish a society where work is creative and free from the coercion of the employers and their drive for profit and more profit.

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