It’s estimated that millions of people are engaged in independent work – or as it’s otherwise known, the ‘gig economy’. Here we take a look at what it means, and the pros and cons of gig models. The gig economy is work that:
- Gives the worker a higher degree of autonomy,
- Is normally paid by the task completed
- Defines the relationship between a worker and end user as short-term in nature
Independent work could be seen as:
- Selling goods
- Providing accommodation
- Delivery services
- Freelancers
- Consultants
- Subcontractors
Advantages Like with any other type of work, there are both advantages and disadvantages of gig models. For organisations that engage independent workers, they benefit from having headcount flexibility. Furthermore, if the company decides to use a digital platform or independent experts, this can reduce the cost significantly and provide a higher quality of products or services. For workers in the gig economy, they can benefit from work-life balance and flexibility, simply choosing when they wish to work or not. Disadvantages On the other hand, independent workers are not guaranteed job security or a steady salary, and they don’t have access to employment-related protections. Additionally, as they have to take care of their own taxes and insurance, there’s a risk that if they don’t do this correctly, they may be unable to benefit from some of the social welfare protections. Finally, their engagement with the business can be terminated whenever the company wishes to do so, subject to any agreement. The employment law perspective The main risk that one can observe from the perspective of employment law is the fact that independent workers could be classified as employees. That would mean that they would have access to all employment benefits such as annual leave, public holiday entitlements and redundancy payments, and would be protected under the Unfair Dismissal Act, TUPE regulations and many others. It’s also worth noting the potential problem with misclassification, which could lead to independent workers racking a bill for tax and social insurance liabilities for the organisation. If you have any questions regarding the issues in this article, please don’t hesitate to contact our 24 Hour Advice Service on 01 855 50 50
