Gig economy workers in Australia including ride-share drivers and food delivery riders could soon benefit from minimum pay and protection against “unfair deactivation”.
Under a bill to be introduced by the Albanese government next week, the Fair Work Commission will be given the power to set minimum standards for hundreds of thousands of “employee-like workers” on digital platforms from 1 July 2024.
The bill fulfils a commitment made before the 2022 election to regulate the gig economy, which Labor hopes will help reduce incentives for unsafe practices that have contributed to a spate of food delivery rider deaths.
The gig economy is one of four major planks to Labor’s closing loopholes bill, which will provide equal pay for labour hire workers, criminalise wage theft and improve the rights of casual employees.
The workplace relations minister, Tony Burke, will discuss the bill at the National Press Club on Thursday after months of consultations and more than 100 meetings with digital labour platforms, unions and employer groups, kept confidential by non-disclosure agreements.
The gig economy changes will allow parties to apply to the commission for orders for minimum standards, including on pay, penalty rates, superannuation, payment terms, record-keeping, insurance and deactivation.
Deactivation is the process of removing a gig economy worker from an app, ending their ability to earn income despite claims workers are “independent” of the platform.
The reforms are limited to digital platform workers who have low bargaining power, low authority over their work or receive pay at or below the rates of comparable employees.
Workers will retain their status as independent contractors and will not be guaranteed the national minimum wage given to employees, but might win a minimum rate per hour, per five-minute block, or per job.
The commission will not be able to set standards on terms such as overtime rates, rostering arrangements or to change how a worker is engaged, which Labor believes will preserve the flexibility of the gig economy model.
Employee-like workers will be protected from unfair deactivation by digital labour platforms, and will have the right to ask the Fair Work Commission to resolve disputes.
The reforms will allow the commission to order different sets of conditions for workers at different platforms, allowing new standards to be introduced without the need for further legislation.
The changes will not affect independent contractors with control and autonomy over their work, such as skilled tradespeople, and are unlikely to apply to platforms that merely match workers with those engaging their services, such as Airtasker.
Burke said “at least 13 gig workers have died on Australian roads in the last few years”.
“That’s unacceptable. We know there is a direct link between low rate of pay and safety: it leads to a situation where workers take risks so they can get more work because they’re struggling to make ends meet.
“We can’t continue to have a situation where the 21st-century technology of the gig platforms comes with 19th-century conditions.”
Burke said if workers are not classified as employees their rights “fall off a cliff”, losing sick leave, annual leave and minimum rates of pay.
“What we want to do is turn the cliff into a ramp,” he said in a statement.
“We’re not trying to turn people into employees when they don’t want to be employees. A whole lot of gig workers like the flexibility from using this technology and that won’t change under our laws.
“But just because someone is working in the gig economy shouldn’t mean that they end up being paid less than they would if they’d been an employee.
“Australia is a country where you shouldn’t have to rely on tips just to get by.”
Labor is hoping that backlash to its gig economy reforms will be minimal, given Uber has already agreed to the principle of minimum standards in talks with the Transport Workers Union.
But employer groups have already begun campaigning against “same job same pay” for labour hire workers, who have warned about possible unintended consequences on subcontracting.
Burke has assured employers those changes will be limited to employers which already have workplace pay deals, who will be required to pay external labour hire workers the same rate of pay.
