"Let's pay them." Ok, with whose money? I am all for good pay for everyone. The problem begins when we detach the pay from the value created by the worker. In many cases worker may become too expensive to hire. So trying to force business to pay more may result in less people having job.
Lots of businesses aren't viable due to the costs of business being greater than the price people would be willing to pay. Pay isn't being detached from the value of the worker, what's being said is that if you're unable to produce enough value from the worker in order to pay them well enough to live then your business isn't viable.
Gig economy companies like Deliveroo are particularly hostile to their labour force. Without fixed wages for employees they're directly incentivised to flood the pool of workers with as many people as possible. The consequence of this is that delivery times are lower, but the compensation available to each employee is greatly reduced compared to traditional delivery models.
The same could be said for child labour or health and safety regulation. If a child is desperate enough to work why shouldn't we let them? Why don't we allow workers to choose to work for companies that put their wellbeing at risk?
The reason is that it ends up not being a choice of the worker at all, incentives align in such a way that these are no longer an "option" but instead a replacement of existing work/choice that had much better outcomes for the worker than the replacement. A great example of this would be "voluntary" exemptions from overtime protections in the UK. There is a default limit on the maximum amount of overtime most workers can undertake. The employee can optionally agree to lift this limit. In practice every employee is given a form to sign along with their employment contract that agrees to lift this limit. It no longer becomes a choice of the worker but one of management.
The same thing happened with "zero hours" contracts. Theoretically they allow employees to be more flexible in how much they work. In reality they remove the ability for workers to plan time or budget due to uncertainty in how often and when management decides they will be working. The key thing is that this replaced the existing, more reliable, system of work not because employees chose it as an option, but because employers unilaterally switched to it.
I'd argue further that the gig economy itself is both a cause and a symptom of economic instability in the lower working class. It emerged from the inability of this group to find to find enough stable, well paying work. It accelerates that economic instability by forcing workers into an even more precarious position. With a zero hours contract the economic uncertainty came from the fact that you didn't know when you'd be working. With gig work you know when you'll be working but you won't know what you'll be paid. This is a fundamental shift in the social contract of employment, in that the risk of loss is born by the employer and in exchange the employer keeps any profit. In the gig economy the employer shifts that burden onto the employees without a corresponding shift in control/profit.
I mean, I think there's two possible situations, depending on whether something is due to worker choice or company choice. I agree that in a situation where everyone is offering shitty conditions, outlawing shitty conditions makes sense. But in a situation where some companies offer shitty conditions, and lots of people decide to go away from their existing companies and work for the shitty companies, then you have to at least entertain the notion that you were wrong about what makes a job shitty.
In that sense, having some companies with shitty conditions offers an important safety valve to learn that regulations were misguided.
> and lots of people decide to go away from their existing companies and work for the shitty companies, then you have to at least entertain the notion that you were wrong about what makes a job shitty
There's a lot of churn in the job market, so people go in and out of work frequently. They may spend a few weeks or months claiming unemployment benefits. In the UK that would be Universal Credit, and some people claiming UC were forced into working zero hour contracts for companies like Uber by the DWP.
This is only holds true if there are more jobs than workers and working these jobs is preferable to unemployment. The reality is that the vast majority of workers are dependent on the decisions of whatever corporation will take them in order to maintain some standard of living.
In your example if we had no unemployment safety nets at all then any form of labour would be justifiable because some workers would choose it over begging/starvation. In fact it is this very argument that is used to justify why people should be allowed to sell themselves into slavery. I believe the preferable alternative to this is to improve those safety nets such that people are able to make a choice on whether that work is worth doing, free from coercion.
> But in a situation where some companies offer shitty conditions, and lots of people decide to go away from their existing companies and work for the shitty companies, then you have to at least entertain the notion that you were wrong about what makes a job shitty.
The problem is that if those shitty conditions allow the company to outcompete, competitors are eventually forced to match those conditions. If we get rid of labour regulation and I start employing children for £0.30/hour my competitors are forced to take a similar step or I'll destroy the majority of them on price alone.
The gig companies do exactly this by shifting the risk of loss on to the worker and relying on information asymmetry between themselves and the worker on the effects of worker competition in order to retain them. In models of traditional employment the company hires and schedules its workers based on forecasted need. If the company mistakenly hires more workers than needed they suffer a reduction in profit. If a gig company "hires" too many employees, the employees make a lower hourly wage and the company increases customer satisfaction due to quicker delivery/ride times. This shifting of risk is what makes gig companies dangerous to the existence of other jobs regardless of whether they're preferable in other ways.
Gig companies are directly incentivised to maximise the "supply" of workers which results in a situation where each additional person signing up reduces the potential earnings of participants in the same area. This is advantageous to the companies but not the workers and that's something that isn't immediately obvious, we have to hope that enough people realise before it becomes the only option.
What makes this even worse is that these companies are burning huge amounts of capital dumping prices/inflating payouts in order to disguise the true costs of their business. The result is that stable businesses are squeezed out artificially.
> In that sense, having some companies with shitty conditions offers an important safety valve to learn that regulations were misguided.
This wouldn't tell you that regulations were misguided unless they happened to be in violation of those regulations. I think that while imperfect public opinion/democratic vote is a much better option than "the invisible hand" for deciding which regulations are valuable.
We pay either way. The question is whether we pay to subsidise businesses that otherwise would not be viable by compensating through the welfare system, or whether we make them actually compete on equal terms with companies that pay well enough for their workers to earn a living wage.
>or whether we make them actually compete on equal terms with companies that pay well enough for their workers to earn a living wage.
Is this what's actually happening here? Are there delivery/cab companies paying a fair wage that's being out-competed by uber? To my knowledge delivery/cab companies don't pay a fair wage in general.
Depends very much on the company. In London there's a huge variety of private hire operators ranging from ones that are almost certainly worse than Uber - but also much smaller - to ones that do have well paid fully employed drivers.
The reason the smaller ones haven't faced more attention is that these actions usually require the person who wants employment status themselves to raise the issue and be prepared to take their employer to tribunal or court.
i'd be interested to see how much the pay of the delivery rider could be increased, while keeping the company profitable, if you only reduced “key management personnel” compensation to a manageable level.
is it really normal for a CEO to earn a thousand times more than a normal employee? a hundred times?
Where I live being a delivery driver is not really a job for an adult. It ranges from 15 year old kids on ebikes to 25 year old students on scooters. Minimum wage for this group is pretty low it wouldn't make that much of a difference.
