Über-Influential? How the Gig Economy's
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Über-influential? How the gig economy’s lobbyists undermine social and workers rights Contents Summary 3 Chapter 1. Introduction 5 Chapter 2. Uber lobbies for low costs, little responsibility 10 Chapter 3. BusinessEurope: never far from the driving seat 26 Chapter 4. Artful lobbying and a ‘grassroots’ chorus boost short-term rental platforms 31 Chapter 5. How has ‘sharing’ come to mean big business? 40 Chapter 6. Crowdwork platform lobbying: a hidden chess player? 44 Chapter 7. Conclusion 50 Published by Corporate Europe Observatory and AK EUROPA (Brussels office of the Austrian Federal Chamber of Labour), September 2019. Text: Rachel Tansey and Kenneth Haar Editing: Katharine Ainger Design by nestor.coop Images: cover image Steve Eason (via Flickr), p. 4 Sam Saunders (via Flickr), p. 8 David Holt (via Flickr), p. 15 Aaron Parecki (via Wikimedia Commons), p. 24 David Holt (via Flickr), p. 30 David Holt (via Flickr), p. 38 screenpunk (via Flickr), p. 43 Steve Eason (via Flickr), p. 46 Leonhard Lenz (via Wikimedia Com- mons) Contents of the report may be quoted or reproduced for non-commercial purposes, provided that the source of information is acknowledged. 2 Contents Über-influential? Summary The ‘gig’ or ‘platform’ economy – which refers well before the gig economy became a political to online companies such as Uber, Airbnb, issue, and the texts do not provide self-evident Deliveroo, and TaskRabbit – is increasing its answers to the burning questions around the lobbying presence in Brussels. Platform com- gig economy. But thanks to direct involvement panies’ key concern is to maintain their special with the Commission, via pressure exerted privileges as part of the so-called ‘collaborative’ from industry groupings and lobbying associa- digital economy, including freedom from many tions, through work with think tanks, we often regulations that ordinary taxi, home-letting, see the Commission act in their favour. Lob- or temp firms, say, would be subject to. Of bying efforts are rewarded: the platforms are particular concern is the way companies like clearly able to use the application of EU single Uber class their workers as self-employed, market rules to push back against regulation thus contributing to a growing degradation of adopted at national level or in cities. labour rights. The current application by the Commission of Over the years, the platforms have been at the the two Directives touch on key interests of the centre of heated debate in cities and member platforms. The e-Commerce Directive makes it states. In response to the challenges platforms difficult to impose rules on the platforms due pose to eg. housing policy or labour rights, to the so-called ‘country-of-origin principle’. authorities have taken measures to mitigate Also, the same directive enables platforms the effect of the rapid increase in the use of to refuse to cooperate with local authorities the services provided by platforms. when they try to acquire the necessary data to enforce protective laws. Even a simple In response, some platforms, Uber and AirBnB thing as a requirement to obtain a licence can in particular, have launched multifaceted lobby be prevented by the current reading of the campaigns to persuade decision-makers in e-Commerce Directive. On top of this comes the EU institutions to come to their defence. specific challenges from the Services Directive In particular, they have worked intensely for – eg. the ban in the directive of ‘quantitative years to persuade the Commission to develop limits’, which in the case of Airbnb and similar its interpretation of two existing directives that rental platforms, can help them reject restric- suits their interests. tions on the use of the platform. The two directives are the e-Commerce Unfortunately the European Commission, Directive from 2000 and the Services Directive dazzled by talk of innovation, has been all too from 2006. Both were written in another era, willing to be influenced by these companies’ Über-influential? Summary 3 lobbying aims. And if the Commission does not live fully up to expectations of platform lobbyists, they can often rely on member state governments instead, as in a recent case on the definition of ‘employee’ which leaves many platform workers without the protection enjoyed by colleagues with similar jobs. However, the EU institutions cannot continue to ignore the fact that platform economy appears to be an efficient model for privatising profits whilst socialising the risks. Meanwhile the social impacts, from loss of labour and consumer rights to unaffordable housing, are on the rise. 4 Summary Über-influential? Chapter 1 Introduction Disruptive, online ‘platform economy’-based businesses, from Uber and Deliveroo, to Airbnb and TaskRabbit, are able to avoid social and labour laws because, they argue, unlike say conventional taxi or delivery services, hotels, or temp agencies, they are mere ‘platforms’. Their success in presenting themselves as the future of the ‘new’ economy, free from historical restrictions such as complying with employment laws, is in part due to their lobbying activities in Brussels. And it is coming at the cost of work- ers’ rights, affordable housing, and social safety nets in general. Online ‘platform’ businesses range from those such as restaurants or hotels or taxis, and in the realm of ‘information services’, such as avoids any of the related safety, consumer, Facebook, Google, and Twitter, to those who or regulatory issues; similarly since it typically organise the provision of services performed classes its workers as self-employed, it avoids in the ‘real economy’. These include companies obligations towards them such as a minimum that organise delivery and transportation, wage or insurance. The company will often site short-term rental accommodation, and various itself in low tax jurisdictions, and as a platform kinds of ‘gig’, ‘task’ or ‘crowd’ work. They usu- often based in another country, it can avoid ally involve creating an intermediary platform responsibility for the social impacts its busi- (often a smartphone app) that connects con- ness model creates, such as increased labour sumers wanting a service (eg takeaway food, a precarity or unaffordable local housing. cleaner, a car ride, a holiday apartment, data processing, translation, etc) and connecting Like any growing industry whose most influen- them to individual providers. Some of the main tial players are multi-billion euro multinational ‘gig economy’ companies are household names companies, gig economy platforms have been such as Uber and Airbnb, and increasingly, the turning their attention to lobbying in Brussels. likes of Home Away, TaskRabbit, and Amazon They are keen to ensure EU rules work in their Mechanical Turk. interests, particularly in maintaining their special treatment as ‘collaborative economy in- It must be said that the platform business novators’. The stakes are high: with the growth model appears to be ideal for privatising prof- of labour and short-term rental platforms, a its whilst socialising risks. A platform company parallel economy with the internet as its main generally doesn’t have to purchase assets tool is emerging, and it is having profound Über-influential? Introduction 5 effects on social rights. These include labour the gig economy somehow eliminates issues rights, social protection policies, consumer of power between workers and companies”, rights, and the right to housing. Many platform noting that in fact, “algorithmic management companies have managed to evade or under- puts dramatically more power in the hands of mine social protections and public interest platform companies”. The newspaper notes laws that other companies have to respect. that Uber, for example, can not only “monitor workers 24/7, they benefit from enormous Despite the platform companies bandying information asymmetries that allow them around words like the ‘sharing’ or ‘collabora- to suddenly deactivate drivers with low user tive’ economy, even the Financial Times points ratings, or take a higher profit margin from out that “we should give up on the fantasy that riders willing to pay more for speedier service, Box 1: Platform workers in the EU A survey for the European Commission shows Percentage of platform workers in Europe an estimated 12 per cent of the adult population according to the 2017 COLLEEM survey, initial in the UK have at some point been platform estimate % 20 workers. In Spain the number is 11.6 per cent; in Germany 10.4 per cent; whereas in countries 15 such as Finland, Slovakia, Hungary, and Sweden, 10 it is 6-7 per cent. On average in Europe it is 5 nearly 10 per cent. Meanwhile an estimated 5.4 per cent workers spend more than ten hours 0 Italy Total Spain per week doing platform work in the EU. An France Croatia Finland Sweden Slovakia Portugal Hungary Romania Germany estimated 6 per cent earn more than a quarter Lithuania Netherlands of their income this way, and only 2.3 per cent of United Kingdom the adult population earn more than half their income this way.6 Overall these developments are a challenge to For comparison, the number of railway workers trade unions. A majority of platform workers in the EU is 0.2 per cent;7 so although platform – up to 68 per cent of the total – consider them- workers are still a small minority, they do repre- selves to be employees of the platforms,10 yet sent a reasonable share of the labour market. generally the responsibilities that come with an Globally the number of platform workers is employer role are not accepted by the compa- growing exponentially, with the trend predicted nies involved. For social rights to be met and to continue.8 While there is no corresponding upheld, a path to defend the rights of platform figure for the EU, platform businesses’ gross workers must be found.11 revenue doubled in Europe between 2014 and 2015.9 6 Introduction Über-influential? without giving drivers a cut.