Getting wise to the gig economy: learnings from Uber

In recent years, the advent of technology, changing job markets, and the evolving needs and wants of employees have all contributed to the growth of the so-called ‘gig’ economy – a thriving melting pot of talent made up of temporary workers, freelancers and contractors. And with this, we have come to meet a new global workforce; one that is blended and highly diverse.

The advantages that the gig economy affords to both the employee and the employer are well documented and include greater flexibility and improved engagement on the employee side, and long term cost savings for business via more efficient resource allocation.

A new level of HR complexity

Less well documented, however, is the topic of employee satisfaction and engagement – and more specifically, how businesses can ensure they’re delivering optimum experiences for all workers, irrespective of their contract type. Only when this is considered, does it become clear that the gig economy has brought with it a whole new level of HR complexity that goes beyond the logistical.

It’s a topic that hit the headlines last week in the form of a well-publicized Uber employment tribunal. Uber, itself a pioneer of the gig economy business model, was taken to tribunal by 19 of its drivers who argued that, in a bid to receive better pay and benefits, they should be classified as Uber employees rather than self-employed contractors.  As it turned out, the court set a new precedent by finding in their favor.

The tribunal sparked interest across the HR landscape because it provides a prime example of the sorts of issues and complexities that the gig economy raises. For instance, how can company leaders optimize worker satisfaction and deliver great workforce experiences if this generates additional cost and impacts upon their profitable gig business model?

A change of mind set

Uber is, of course, not the only firm to be taken to task over how it classifies and rewards its drivers – Deliveroo recently hit the news for similar reasons. And, with these high profile legal proceedings likely to spur on gig workers around the world, we foresee many more tribunals as both the freelance economy and the number of dissatisfied gig workers continue to grow.

In the same way that the gig economy has radically changed HR for many businesses, the time has come for an equally radical change in business mind set. With gig workers making up a large proportion of many workforces these days, companies need to develop strong HR strategies that prioritize delivering great workforce experiences for all.

So how can this be done? Clear communication and a common understanding of the objective(s) will always be fundamental, as will a modern HR system with modern performance management tools that can provide recommendations for reward irrespective of whether a worker is a full-time employee or a freelancer. Without these, the task of engineering an engaged and productive workforce will be nigh on impossible.

Realizing the benefits of a blended workforce

Of course, many forward-thinking HR and company leaders already understand the business value of investing in the blended workforce. This recent Forbes article highlights that as many as 93% of companies are now employing both full-time employees and contracted freelances on a regular basis – and with great results.

This provides further evidence that the gig economy – and how to optimize it – is featuring as an ever more important item on the modern business agenda, and that’s a very positive step forward. That said, Uber and others do continue to highlight that there is more work to be done when it comes to ensuring gig workers remain engaged and therefore, productive.

Why not take a look at our recent research on the changing nature of the workforce and the complexities it brings to HR here.

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