How Online Platforms are Jeapordising the ‘Free’ in ‘Freelancing’ | FactorDaily

Op-Eds by Vidhi Karnataka · March 4, 2019
Author(s): Divij Joshi

A large part of the estimated 1.5 million Indian ‘driver partners’ of taxi aggregator platforms Ola and Uber ‘logged off’ to protest against ostensibly unjustified decreases in earnings, particularly in the withdrawal of trip-based incentives in November 2018. In December of the same year, ‘delivery executives’ of Swiggy, the restaurant aggregator platform, went on a flash strike for similar reasons – the company had allegedly arbitrarily changed the calculation of incentive-based earnings for its executives.

A few characteristics distinguish these from traditional industrial disputes – the workers have no formal union for organising themselves, they have no office to picket, and their chief grouse is not against a factory manager, but against a software update on a smartphone app.

The digital economy is transforming concepts of employment and work – from increasing delocalisation of work, to the trend towards the gig economy and the disruption of traditional forms of labour organisation. Even as data recently released by the National Sample Survey Organisation report flagged concerns of a large-scale unemployment crisis in India, studies indicate that India is a global leader in online ‘microwork’ (task-based work) – with Indian workers supplying up to 24% of the work mediated through online platforms. With remote microwork platforms emerging as the new BPO industry, and transport and delivery apps like Uber and Swiggy fast replacing traditional forms of these services across the country, Indians are increasingly turning to online platforms for sources of gainful employment. Yet, the implications of this emerging form of labour remains largely unnoticed by law and policy in India.

As techno-capitalism’s logic of incessant disruption extends to notions of work and employment, it begs the question – how should India prepare for the future of work?

Employment, Disrupted

Upwork, Swiggy, Uber, MTurk and a plethora of similar platforms can all be characterised as online labour platforms – a term encompassing digital platforms which intermediate the demand and supply for labour across a number of sectors. Online labour platforms exhibit highly heterogeneous business models, yet they share a few broad characteristics – notably, in serving as a mechanism for participation or interaction between workers and consumers, and governing these relationships, largely through data-based tools and algorithmic management.

These business models enable those seeking specific forms of labour, to connect with workers ready to perform those tasks. This lends itself easily to on-demand, ‘freelancing’ work in a number of ways – by providing tools for competitive bidding and crowdsourcing of specific tasks, as in Upwork and MTurk, or by matching instantaneous demand, based on a number of considerations including location and availability, as in food and taxi aggregators. Freelancing can potentially offer a high amount of independence and flexibility to workers, including freedom from managerial control and surveillance, and the ability to work at the times and places of their choosing. However, the design and technology through which many of these platforms operate often reinforces control and leverages the platforms economic power to the detriment of workers, by extending to determination of worker compensation, work timings and standards of service.

Take the case of Uber or Ola, for example. In order to drive for these companies, the drivers need to sign a take-it-or-leave-it ‘clickwrap’ agreement, which transfers the risk for the undertaking to the ‘driver partners’ and away from the companies. This is done through terms including the ability to unilaterally change the conditions of service (including pay and incentives), confidentiality agreements which disallow drivers to create customer lists of their own, and terms which limit the companies’ liability for breach of contract.

Apart from such legal manoeuvring, the design and technology also plays a role in creating greater control over workers. The day-to-day management of workers on many platforms is mediated through opaque algorithms rather than humans, where workers are constantly surveilled to provide data for further managerial automation. These algorithms perform managerial functions using data analytics to design how tasks should be performed by specific workers in specific situations – yet due to the opacity of the algorithms and information asymmetry, workers are often unaware of why work gets allotted to them, or why specific incentive structures, like surge pricing or task-based incentives, have been created for them, or how they can best utilise the same.

One example of this is employee reputation systems. Such reputation mechanisms, over which workers have little control, can determine how visible or likely a worker is to get the next ‘gig’ on the platform, and can have even harsher effects like deplatforming a worker if they fall below a specific threshold, without adequate explanation of how such a decision was arrived at, nor mechanisms to challenge such decisions. Another is automated pricingmechanisms employed by delivery or transport platforms, which use algorithmically determined ‘nudges’ to control where and how workers operate, incentivising them to work specific tasks by surging or reducing prices. Yet other means of exerting control include scheduling requirements, which automatically ‘punish’ workers for being logged off for extensive periods or not performing tasks within defined standards.

Countering the Digital Domination of Workers

Indian law provides for specific labour protections precisely to counter such dominationof workers by employers, and equalize bargaining power – enacting protections including the right to paid leave, the right to organise and strike and protections against arbitrary retrenchment, among others. However, the emerge of online labour platforms in the labour market has resulted in significant regulatory uncertainty as to the role and liabilities of such platforms, which stems from a combination of genuinely novel business models and uses of technology, as well as by the manner in which these firms have positioned themselves – exploiting regulatory loopholes, and, as is axiomatic of silicon valley, moving fast and breaking things, possibly including the law. Due to this, extant labour protections are not clear in their applicability to online labour platforms.

As these platforms increasingly become important for Indian workers, it is crucial to re-examine and clarify the labour protections applicable to platform workers. There are a number of ways to achieve this.

First, existing laws could be applied to platforms on a case-to-case judicial determination. If a platform satisfies the classical tests for being an employer, which includethe extent of control over workers and assessing the independence of workers, then it must follow obligations under labour law, including protections such as a minimum wage and retrenchment procedures. This would compel platforms to choose a position– either they must reduce the amount of control exerted over online labour, or they must embrace their role as employers. This is precisely what a number of lawsuits against Uber, across the world, have achieved. A petition in the Delhi High Court also sought similar protections, but was eventually withdrawn.

However, labour laws in India are often inadequate, and may not offer the best solution to platform workers. An alternate approach could create ex-ante obligations on online labour platforms, including minimum standards and conditions which ought to be applied to workers. This could include limitations on worker surveillance; ensuring portability of information, including reputational systems, permitting and enabling networking between workers and consumers as well as inter-se between workers (for the purpose of organising or unionising), and allowing transparency and appealability of significant automated decisions made by platforms, all of which would reduce information asymmetry between workers and platforms.

Finally, there could be a wholesale shift in the manner in which labour regulation operates. Expanding universal social security, or ensuring that traditionally employer-centric worker protections like insurance are portable between employers or platforms, are long-term steps towards ensuring radical change in labour laws.

The internet once held the promise of the rise of a radical ‘sharing economy’ – non-market and non-hierarchical forms of co-ordinated production between peers, as predicted by Yochai Benkler in the seminal text, ‘The Wealth of Networks’. The sharing economy was expected to displace the inequitable and hierarchical means of production in a traditional market economy. To some extent, platforms like GitHub and Wikipedia embody such visions, enabling non-market production of knowledge and software.

Yet, the wisdom of the ‘sharing economy’ has been co-opted by large technology companies, which have consolidated with themselves the economic power enabled by networks, instead further embedding them in the political economy of market-led production. Nowhere is this more evident than in the case of online platform labour – contrast Uber or Ola’s business models with decentralised visions of carpooling or car-sharing; or Amazon MTurk’s creation a force of dependent workers, shorn of social benefits and employee protections, from independent freelancers with greater control over the processes of production. It’s high time to reverse this trend and reclaim the revolutionary potential of the sharing economy.

Originally Published –

About Divij Joshi:

Divij Joshi is a Research Fellow at Vidhi, Bengaluru. He graduated from the National Law School of India University, Bangalore, in 2016, and subsequently worked in the disputes resolution team of AZB & Partners in Mumbai. He has also worked as an independent consultant and researcher with civil society organizations, and regularly writes on topics of intellectual property rights and the information society. His areas of interest include access to knowledge, innovation and law and technology.