Gig economy commission well-meaning, but is it enough?

 

From Wan Agyl Wan Hassan

The move by the government to establish a Gig Economy Commission (SEGiM) has sparked considerable discussion.

On the surface, it appears promising – our deputy prime minister aims to protect gig workers’ rights.

However, a closer examination reveals that SEGiM may not effectively address the real challenges within our gig economy. What we might actually need are simpler policy changes and clear directions to get to the core of the issues.

The gig economy is significant in Malaysia, comprising about 26% of our workforce. It’s commendable that the government recognises this and seeks to ensure fair treatment, income security, and workers’ rights.

However, the gig economy is diverse, including ride-sharing drivers, food delivery riders, freelance consultants, and digital content creators. Attempting to regulate all these different jobs under one set of rules may not be effective.

For instance, what works for a Grab driver might not suit a freelance graphic designer. If we force everyone into the same mold, we risk stifling innovation and complicating life for those we aim to assist.

Over-regulation can lead to unintended consequences. Studies show that when rules increase, platforms incur higher costs, which typically gets passed on to consumers through higher prices or to gig workers through reduced earnings and fewer opportunities.

In some cases, platforms may even choose to exit the market, resulting in fewer jobs and services for Malaysians.

We can look at examples from other countries.

In Spain, stringent labour laws for gig workers were introduced in 2021, leading companies like Deliveroo to shut down operations. This resulted in job losses and fewer service options for people relying on those platforms.

In contrast, the UK took a different route, with companies like Uber collaborating with worker unions to provide benefits such as holiday pay and pension contributions, all while maintaining flexibility.

This illustrates that it’s possible to protect workers without excessive regulation.

Flexibility is the core of the gig economy; it’s why many people opt for gig work. Workers appreciate the ability to set their own schedules and choose their jobs, allowing them to balance other commitments like studies or family care.

If regulations begin to curtail that flexibility, we risk pushing individuals away from gig work altogether.

So, what alternatives exist? Agencies like the human resources ministry, the Social Security Organisation (Socso), and the Employees Provident Fund (EPF) could enhance their support for gig workers.

By strengthening these institutions and tailoring their programmes to the unique needs of the gig economy, we could offer necessary protections without adding unnecessary bureaucracy.

Another approach is to promote self-regulation within the gig economy, supported by clear government guidelines.

When platforms and worker associations collaborate, they can establish fair wages, benefits, and working conditions that reflect the industry’s dynamic nature.

Here are some strategies to better support our gig workers and sustain the gig economy:

• Empower existing agencies
  Strengthen the human resources ministry, Socso and the EPF to develop programmes specifically for gig workers. Dedicated departments could address the unique challenges within the gig economy.
• Facilitate stakeholder collaboration
  Create platforms where government agencies, gig platforms, and worker representatives can engage in open discussions. This collaboration can lead to policies that balance protection with flexibility.
• Implement targeted policies
  Rather than broad regulations, introduce specific measures to address key issues like social security contributions, healthcare access, and dispute resolution – without imposing one-size-fits-all rules.
• Enhance data collection and research
  Invest in studies to gain a deeper understanding of the gig economy – who participates, the economic impact, and the distinct challenges across sectors. This data will enable better-informed policy-making.
• Promote awareness and education
  Launch initiatives to inform gig workers about available protections and resources. When they are well-informed, they can make better decisions regarding their work.

Ultimately, SEGiM is a well-intentioned initiative, but its potential shortcomings highlight the need for a deeper understanding of the gig economy’s complexities.

Over-regulation and added bureaucracy could inadvertently complicate matters for the workers it aims to help.

A more effective path involves empowering existing institutions, fostering collaboration among all stakeholders, and implementing targeted policies that protect workers while preserving the flexibility and innovation that define the gig economy.

Policymakers should engage directly with gig workers and platforms to develop practical and beneficial solutions. - FMT

Wan Agyl Wan Hassan is a transport consultant, the founder of transport think tank MY Mobility Vision, and an FMT reader.

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.