Fair and Square: Why Extending the $15 Minimum Wage to Gig Workers Is Important
What is the gig economy? Well, if you have ordered food or booked a ride through an app, then you have a good idea of what it is. The gig economy involves the exchange of labour for money between individuals or companies through digital platforms that match providers and customers on a short-term and/or payment-by-task basis.
By contrast, traditional employees have consistent work with a single company and steady salary, and they are guaranteed to make at least minimum wage. Workers in the gig economy do not have that stability. As the gig economy grows, it becomes even more important that they get paid fairly.
A variety of sectors
Among the most common sectors in the gig economy are transportation-based services, including food delivery and ride-sharing, and asset-sharing services, including home sharing or parking space-sharing. There are also digital platforms that connect freelancers with businesses or individuals to complete projects, and this ranges from writing to art and design work.
Pre-COVID gig economy
According to a study by Statistics Canada, in 2016, pre-pandemic times, gig workers – self-employed freelancers, on-demand online workers and day labourer – represented about eight to ten per cent of all Canadian workers. This was a combination of individuals who did gig work to supplement their wage employment and those who primarily relied on gig earnings.
In the midst of the pandemic, that number ballooned to 20 per cent according to a survey by staffing firm Randstad, and it’s completely expected. The health crisis had a strong negative impact on regular 9-to-5 jobs, while opening more flexible work opportunities in the form of gig jobs that catered to those whose work was disrupted and became irregular. With the lockdown restrictions posing a greater need for app-based deliveries, especially food and groceries, the gig economy soared.
On the other hand, employers preferred the gig workers because they have a wider access to a talent pool, especially when it comes to freelance editing or writing projects where they can hire anyone in the world if they are qualified.
Another perk for employers is that they don’t have to shoulder the expenses for benefits like extended health insurance coverage or RRSPs because the employees are project-based or purely short-term.
All That’s Going to Change
Now this is where a big change is set to take place.
On February 28, 2022, the Ontario government introduced a new legislation that will give app-based gig workers “fundamental rights,” including a $15 minimum wage and transparency when it comes to their tips.
Dubbed as the “Digital Platform Workers’ Rights Act,” this will ensure a regular minimum wage for those employed by app-based services, such as ride-share drivers and couriers, which they will receive on top of their tips. The legislation will also make it mandatory for workers to receive a recurring pay period and pay day while at the same time preventing platform operators to withhold their tips.
The committee behind the “Digital Platform Workers’ Rights Act” also suggested coverage for workers employed by platform-based services that include benefits and severance.
These are changes that gig workers would welcome with open arms, but there’s still a lot of work to be done for them to not feel like they are second-class workers.
Bajwa, Rumzz. “How the Gig Economy Benefits Employees & Businesses.” GlobalTrade. https://www.globaltrademag.com/how-the-gig-economy-benefits-employees-businesses/
Charlton, Emma. “What is the gig economy and what’s the deal for gig workers?” World Economic Forum. https://www.weforum.org/agenda/2021/05/what-gig-economy-workers/
Henderson, Rebecca. “How COVID-19 Has Transformed The Gig Economy.” Forbes. https://www.forbes.com/sites/rebeccahenderson/2020/12/10/how-covid-19-has-transformed-the-gig-economy/?sh=3e9692436c99
Nosov, Ritva. “The gig economy will continue to grow postpandemic. Is your company ready?” The Globe and Mail. https://www.theglobeandmail.com/business/careers/leadership/article-the-gig-economy-will-continue-to-grow-postpandemic-is-your-company/
Petriglieri, Gianpiero, et al. “Thriving in the Gig Economy.” Harvard Business Review. https://hbr.org/2018/03/thriving-in-the-gig-economy
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Statistics Canada. “The impact of COVID-19 on the gig economy: Short- and long-term concerns.” https://www150.statcan.gc.ca/n1/pub/45-28-0001/2020001/article/00021-eng.htm