Denham Sadler
September 25, 2018

Victoria’s gig economy inquiry

Policy

Victoria’s gig economy inquiry

Natalie James: Leading the Victorian inquiry into the gig economy work practices

The Victorian government has thrown itself into the ongoing federal debate on the regulation of the gig economy with the launch of an “Australian-first” inquiry into the on-demand workforce.

The Victorian inquiry comes just days after a Labor-led Senate committee in the federal Parliament delivered a report on the future of work, recommending tighter regulation of the gig economy and an expansion of the definition of “employee” to include those working for on-demand companies like Uber and Deliveroo.

While federal Labor has said that legislation is required to ensure workers are treated fairly, the federal government has rejected this, maintaining that further regulation could stifle innovation.

These arguments have been mirrored in Victoria. The Labor government, backed by the unions, pushing for regulation to protect the rights of workers, while the Coalition opposition is cautioning against this approach.

Over the weekend, the Victorian government announced plans to tackle worker exploitation in the gig economy, with the launch of the inquiry.

The inquiry, to be chaired by former Commonwealth Fair Work Ombudsman Natalie James, will report back by the end of next year.

It will investigate the status of those working for online companies or platforms in the state, allegations of exploitation of workers in the sector, the application and effectiveness of current workplace laws, and how on-demand workers are regulated around the country.

“Australia is crying out for an evidence-led, independent examination of the work arrangements in the gig and on-demand economies,” Ms James said.

Finance Minister Robin Scott said that a lack of action from the federal government led the state government to step up to the plate.

“The inquiry will examine Victoria’s capacity to protect the rights of vulnerable workers in the absence of a meaningful national approach,” Mr Scott said.

A number of major unions have long-been campaigning for improved rights for those working for on-demand companies like Uber and Airtasker.

This campaign has been backed by Federal Labor, with the Opposition flagging its intentions to crackdown on these companies and legislate better rights for workers recently.

But the state opposition has warned that further regulation of the gig economy could hinder its growth, reflecting the stance of the federal government.

“It’s important that all workers are paid their legal entitlements but Labor mustn’t use this inquiry as an excuse to unionise the gig economy and undermine the flexibility and innovation that has made it so successful,” Shadow innovation minister David Southwick told InnovationAus.com.

The Transport Workers Union has been leading the campaign to regulate the gig economy, and has welcomed the news of the inquiry in Victoria.

“Urgent reforms are needed to ensure workers get the rights they deserve. We believe these reforms must create a flexible system to allow workers to claim rights. Without a flexible system tech giants will just move the goalposts every time laws are changed to give certain groups of workers rights,” the TWU’s Tony Sheldon told InnovationAus.com.

“The scale of daily wage theft is unprecedented, with a survey showing three out of four delivery riders are paid below the minimum rate. Companies are stealing their wages, their super and they are being unfairly sacked by getting kicked off the app – without any warning or chance to challenge their dismissal,” Mr Sheldon said.

Gig economy giants like Uber have continually maintained that its workers are independent contractors rather than employees, meaning that don’t have to provide benefits such as superannuation.

“Uber provides an open and genuinely flexible income-generation opportunity to any person who has signed up and met the regulatory qualifications to use the app,” an Uber spokesperson said.

Federal Labor has also welcomed the inquiry but shadow employment minister Brendan O’Connor said it is a reminder of the federal government’s “absolute failure to deal with the changing nature of work”.

“They have no plan to deal with the rapid growth and impact of the digital economy on increasingly casualised and precarious work. There have been a number of examples of underpayment and exploitation of workers employed in the gig economy as contractors when they clearly are employees,” Mr O’Connor said in a statement.

The Senate Committee report on the future of work, led by the Opposition, recommended that further legislation is required to regulate the gig economy and ensure workplace health and safety and superannuation.

The committee also recommended that the definition of an employee be broadened to include those working in the gig economy.

The Labor senators said that gig economy companies “take advantage of legislative shortcomings” to avoid responsibilities traditionally associated with being an employer, and called for a “swift regulatory response which would broaden the definition of employee to capture gig economy workers.”

But the federal government has rejected the need for further regulation of the sector.

“Liberal National senators recognise that the potential growth of the gig economy in Australia presents opportunities for flexibility and innovation, which can enhance the economy, but which also present challenges to the status quo which must be addressed,” government senators said in a dissenting view.

“We are of the view that regulation should not come at the cost of innovation and worker flexibility and access to opportunities.”

“Labor’s hostility to gig opportunities seems to be at the direction of the increasingly irrelevant union movement, who appears incapable of embracing a non-unionised, flexible workforce. Liberal National senators support a more thoughtful and nuanced debate on the appropriate safeguards required to support and foster a vibrant innovative economy.”

While acknowledging the benefits that come with the gig economy, Mr O’Connor said workers’ rights need to be the focus.

“While there are undoubtedly benefits to the gig economy and new forms of work organisations, if a business model can only success on the basis of undermining workers’ rights and avoiding workers entitlements that is not a model Labor supports,” he said.

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