Uber good news

After my last rather gloomy post, today there is some good news. I’ve posted elsewhere about the rise of uberfication and the gig economy, and also about how this links to supposed ‘self-employment’, which is really employment shorn of any protections. (I do not write about this in the current edition of the book, but it will be covered in the fourth edition, which comes out next month).

Today, the company after which the phenomenon was named, taxi app firm Uber, was subject to a significant ruling by a UK employment tribunal. Specifically, Uber was told that it cannot treat its drivers as self-employed, and must pay them the national living wage and holiday pay, and possibly even pensions. The ruling (which is likely to be appealed against by Uber) will, if it stands, have significant implications for other companies operating the same or similar business models. As the lawyer representing the drivers who brought the case (with the support of the GMB union) said:

“This is a ground-breaking decision. It will impact not just on the thousands of Uber drivers working in this country, but on all workers in the so-called gig economy whose employers wrongly classify them as self-employed and deny them the rights to which they are entitled.”

This ruling comes at a significant time, politically. In both the EU Referendum (and for those interested in Brexit, do take a look at my Brexit blog tracing developments) and, even more, the US presidential race, the issue of how changing work practices erode security has been an issue. More widely, this connects with the political consequences of globalization and the hollowing out of middle class employment.

Of course, even on minimum wage and protection terms, employment remains a far cry from the post-war social democratic model of secure employment with a social welfare net. Even so, the ruling suggests that the direction of travel need not inevitably be downwards, and that globalization and technology are not forces of nature but may be corralled by politics and legislation. As I argue throughout my book, what happens in organizations is not pre-ordained but is an outcome of the choices we, collectively, make about how to live.

Sick

Today’s post is prompted by the story this week that Hillary Clinton has had to take time off from campaigning because she has pneumonia. In fact, she only took four days off – which, frankly, seems very little to recover from pneumonia - but this has been seized on by her political opponents as evidence that she is not up to the job of US President.

Although the political reasons for this are obvious, it seems to me to fit with a wider issue of the way that in the UK, at least, going off sick is frowned upon, and worse. It can be taken as a sign of unreliability and lack of commitment. The Sports Direct scandal revealed exactly this, with sick leave being counted against workers, who as a result were too scared to take it. But that case is the tip of a much larger iceberg. A 2015 survey found that one in four British workers were too afraid to take time off when ill, and the study suggests that they are much less likely to do so than workers in some other countries: in 2015 8.9% of British workers took more than 8 days sick leave compared with 25.3% of German workers.

If we discount the idea that the British are inherently healthier than the Germans, then it seems obvious that what is at issue is the politics and culture of work. Organizationally, it links to the more brutal management and work conditions in Britain, including the precarious employment terms discussed in my last post. Certainly self-employed workers take about half as much time off sick as those in employment.

British politicians routinely berate the public sector in particular for having higher levels of sick leave than the private sector even though both have fallen steadily for the last 20 years according to the Office for National Statistics. But Stephen Bevan of the Work Foundation and Lancaster University Management School explains that this difference (7.9 days per year in the public sector versus 5.5 days in the private sector) can easily be understood. It isn’t that public sector workers are malingerers, but a combination of the demographics, the more risky occupations and the better recording of sick leave that exist within the public sector.

In addition to this, I think that there is a very macho issue around taking sick leave. This seems evident in the debate about Hillary Clinton illness but, more generally in the sense that it is somehow ‘soft’ or ‘wimpy’ to ‘give in’ and take time off. Real men power on through it. The UK statistics bear this out, with women losing 2.6% of working hours to sickness compared with 1.6% for men (2013 figures).

It seems unlikely to me that it is any better for businesses than for individuals to work when they are sick. They are likely to be less productive, and to infect other workers. With the weather in Britain today having taken a decisive turn to autumn, we are now entering the season of coughs and colds. Personally, I find it intensely unpleasant if the people at work, in shops or on public transport are spluttering and sneezing all over me. In 1945 there was a splendidly amusing public information film (you can see it here) warning that ‘coughs and sneezes spread diseases’ and instructing people to use a handkerchief. Well, that’s fine so far as it goes, but much better for all concerned to stay off sick until you get better, and for employers to support that.

Work and food

There has been a huge – 20% - rise in the number of workers in the UK on Zero Hours Contracts (ZHCs) in the last year, bringing the total to about 900,000. It’s telling that in the third edition of my book, published in 2012 but mainly written in 2011 I did not mention ZHCs, which at that time were much less common and there were perhaps only 200,000 workers on them in the UK. That is remedied in the fourth edition that will be out later this year, of course, but even that will not take account of this latest surge.

Lauded as offering ‘flexibility’ for individuals, ZHCs are all about flexibility for organizations: there are no guaranteed hours, it is labour on demand. And although in the public mind they are associated with low-skill jobs like cleaning and catering, they are also common in professional occupations such as teaching and airline pilots.

It’s become obligatory to say that ZHCs suit some people, but to foreground that is to de-emphasise that in most cases they do not, and are a source of miserable insecurity (for some experiences see here and here). But recently published research shows that they are also bad from a business point of view, in terms of contributing to the long-term productivity problem of UK business (Rubery, Keizer & Grimshaw, 2016).

The worst kinds of ZHCs – so-called exclusive ZHCs, which prevent workers taking employment with other employers – have been banned in the UK. And, under great political pressure, retailer Sports Direct (where over 90% of staff are on ZHCs) has announced this week that it will give its employees (but not agency staff) a choice between a ZHC and a guaranteed hours contract. But ZHCs are illegal in New Zealand and (with some complexity of definition) in many European countries.

Whilst ZHCs have received a lot of media and political attention, what is perhaps even more significant is the rise in self-employment. This connotes an image of small entrepreneurs and sturdy self-reliance of the sort lauded by free market ideologues. In fact, it is largely to do with companies employing people as independent contractors – often, people who were hitherto employees of the same companies they now contact to – and the rise of the gig, or uber, economy. There are perhaps 5 million people in the UK who are self-employed.

I know from personal experience what the insecurity of self-employment means because my father, after he left the army, was a self-employed driving instructor during my childhood. That encompassed periods when anything from illness to a heavy snowfall to the petrol shortages during the 1973 oil crisis, and in those periods he had no income and no savings and the consequence was that our family had – almost literally - no food. But what I remember more from those times than the lack of food is the pervasive worry that tomorrow there would be no food at all. Nowadays, I’m insulated from such insecurity but when I contribute to the local foodbank it’s because I remember what it means. In the UK currently there are a million people a year who use foodbanks, although this is probably an underestimate. One of the key drivers is reported to be ‘insecure work arrangements’ including ZHCs.