Most share plans only extend to ‘regular’ employees. This means ad-hoc workers and consultants often lose out. But as we enter a new era in the world of work — a world dominated by short-term contracts and freelance work — should organisations change their reward programmes to accommodate the modern workforce?
It’s work, but not as we know it.
The ‘gig’ economy started to take off during the 2008 financial crisis, and has been growing ever since. According to the Office of National Statistics, gig workers are projected to rise to 7.5 million this year, out of a total workforce of just under 30 million. It means almost a quarter of us work in the gig economy.
For some, this way of working is a choice to keep their independence; for others, it’s forced upon them as they struggle to find alternative sources of income.
The rise of the platform gig
Many of today’s young workers have found their hands tied in the post-Covid world. According to The Guardian, “young people who lost their jobs during the pandemic in the UK have returned to less secure work, often in gig economy roles.”
These young “returners” – who were employed pre-Covid but lost their jobs in the pandemic – are now much more likely than those who stayed in work to be on a temporary or zero-hours contract, doing agency work, or irregular hours.
And many of them are carrying out platform work, using websites and apps such as Uber, deliveroo or TaskRabbit.
Is the gig economy changing?
Gig economy platforms have been heavily criticised for exploiting their workers. While the promise of flexibility is enticing, many gig workers find that they’ve been treated as disposable labour, enduring low pay and poor working conditions.
But is the tide turning? For years, Uber classified its drivers as self-employed partners; but in 2021, the UK Supreme Court found that Uber drivers should be classed as ‘workers’. This means they are now entitled to the national minimum wage, holiday pay, pensions and other rights like whistleblowing.
The Supreme Court’s decision is expected to send waves of change through the gig economy, especially for businesses with similar operating models. For many, introducing the minimum wage isn’t financially viable. Instead, they may have to change their ways of working just to survive.
On one side of the coin, this will be seen as a positive move to protect workers, especially ‘returners’ who have been nudged into this type of work since the pandemic. But on the flip side, many gig workers are attracted to this lifestyle. They enjoy the flexibility, risk and entrepreneurialism the gig economy offers and wouldn’t want to give this up for employee status.
So how should gig workers be rewarded?
There needs to be some balance. Businesses who take advantage of their workers should, of course, face repercussions.
But many sectors are still reeling in the wake of the pandemic. Imposing unnecessary regulations on the agile and dynamic gig economy could be very damaging to this important sector of the UK economy. Instead, perhaps companies who operate in these areas need to find new ways to support and recognise their gig workers, so that they are fairly rewarded for the work they do.
Implementing novel practices – or even borrowing successful models from other organisations – could benefit both the business and its workers. Gig workers would feel empowered to retain the independence and flexibility that they value. The organisations would keep access to the large talent pool in the economy, allowing them to strengthen their network and offering.
One such benefit could be introducing a share plan for gig workers. Share plans are a great way for businesses to share their success with their workers. Rewarding employees for their contribution allows them to own the fruit of their labours, creating a culture of shared ownership. This fosters a deeper connection with the organisation by providing a sense of belonging, which improves retention.
The workplace is changing, and this needs to be reflected in how organisations reward their people and associates. Benefits programmes should follow changes in our economy so that companies remain relevant and attractive to all kinds of workers, regardless of their employment contracts.
If you need help communicating changes to your reward schemes and share plans, then get in touch. We’d be more than happy to help.