The government of Victoria is holding an important inquiry into the conditions and challenges of working in the ‘on-demand’ economy: a polite euphemism for gigs. The Centre for Future Work has made a submission.

Our submission notes that digitally-mediated on-demand production typically incorporates five broad characteristics:

• Work is performed on an on-demand or as-needed basis. Producers only work when their services are immediately required, and there is no guarantee of ongoing engagement.
• Work is compensated on a piece-work basis. Producers are paid for each discrete task or unit of output, not for their time.
• Producers are required to supply their own capital equipment. This typically includes providing the place where work occurs (their home, their car, etc.), as well as any tools, equipment and materials utilised directly in production. Because individual workers’ financial capacity to provide these up-front investments is limited, the capital requirements of platform work (at least that used directly by workers) are small.
• The entity organising the work is distinct from the end-user or final consumer of the output, implying a triangular relationship between the producer, the end-user, and the intermediary.
• Finally, some form of digital intermediation is utilised to commission the work, engage the producer, supervise it, deliver it to the final customer, and facilitate payment. In the modern economy, this last criteria is hardly exrtaordinary: virtually any job imaginable today relies on some form of digital task allocation or management.

Despite the media hype which on-demand platforms have generated, the scale of employment engaged in on-demand work so far is rather modest. The number of people engaged in actual productive work organised through a digital platform is small (less than 1% of the labour force), and a large (likely majority) proportion of those rely on on-demand work for only a minority of their total income. Many people have signed up to perform work through one or more of these platforms, but do not stay with the platform long, and/or do not work many hours in the role.

Another stereotype that needs to be challenged in considering on-demand work is the common claim that these employment practices are novel and innovative. Here it is crucial to distinguish between the technical innovations which these businesses utilise, and the changes in work organisation which those models also introduce. In fact, the major organisational features of digital platform work are not new at all. These practices have been used regularly in labour markets for hundreds of years; what is novel is the use of digital technologies for organising, supervising, and compensating work in that manner. And the growth of insecure or precarious work practices is not an essentially technology-driven phenomenon. Rather, the growing precarity of work, including in digitally-mediated on-demand jobs, reflects the evolution of social relationships and power balances, more than technological innovation in its own right. Appreciating the social and regulatory dimensions of technology and work organisation contributes to a more holistic and balanced understanding of the rise of on-demand work, its consequences, and its potential remedies.

All the core features associated with on-demand work are long-standing. The practice of on-call or contingent labour – whereby workers are employed only when directly needed – has been common for hundreds of years. In an Australian context, a famous example is the former practice of dockworkers lining up each morning (for example, along Sydney’s ‘Hungry Mile’) in hopes of attaining employment that day; other examples are common in other sectors (including minerals, forestry, manufacturing, and agriculture).

Home-based work, and other systems in which workers supply their own capital equipment, have also been common in many applications and contexts – from the ‘putting out’ system for manufacturing textile products and housewares in the early years of the industrial revolution, to the important role played by owner-operators in many modern industries (including transportation, resources, fisheries, and personal services).

Piece-work compensation systems also have a long if uneven history. Employers have long aimed to tie compensation directly to output (as a way of shifting responsibility for managing work effort and productivity onto workers). Yet at the same time, the use of piece-work is constrained by numerous well-known problems, including difficulties in applying them in situations which require an emphasis on quality, not just quantity of output (like most service sector activities), and where work is performed jointly by teams or larger groups of workers.

Finally, the triangular relationship that is evident in the on-demand economy between the worker/producer, the ultimate end-user of their labour (whether a business or a consumer), and an intermediary/‘middleman’ business is also very familiar from economic history. Past examples include labour hire services, “gang-masters,” and other forms of labour supply intermediation. Under this triangulated model of employment, it can be unclear who is the actual ‘employer’; this ambiguity opens the possibility for various negative practices and outcomes, which have been recognised for years in legislation, regulation, and jurisprudence.  An example is Australia’s long-standing rules regarding ‘sham contracting’, and more recent initiatives to regulate labour hire businesses in Queensland and Victoria.

In short, the core features of on-demand work are not novel; and claims that this way of organising work is ‘new’ are not valid. Rather, on-demand businesses reflect a resurgence of very old business practices, that date back hundreds of years. So ‘gig’ employers cannot be allowed to invoke claims of technological advancement, to justify work practices that are hundreds of years old – and in many cases violate community standards and traditional labour laws.