Employment rights, particularly the ‘gig economy’ with short-term contracts and freelance work, are under increased media scrutiny as the new Labour government seeks to introduce a new Employment Rights Bill and other legislation. There was an 85 per cent increase in mentions of ‘employment rights’ in the UK and Irish media in the last six months compared to the previous six.
More flexible working arrangements can offer benefits for both employees and employers, and they have grown in popularity in recent years. Such employment terms can apply to everyone from private hire drivers and food delivery workers to dog walkers, web developers, cleaners and others who source their work through apps and websites.
However, these types of employment come with higher reputational risks. A robust communications strategy is imperative, especially in the event of a crisis.
For gig economy platforms like Uber, Freenow and Taskrabbit, as well as multi-level marketing firms like Usborne’s Books At Home, which ‘employ’ people not on direct contracts, a crisis or reputational issue is never far away.
For instance, Utility Warehouse found itself at the centre of a media storm in 2023 when a reward holiday to the Maldives for its most successful partners was badly received during a time of high energy bills.
The seven-year legal battle between the Independent Workers’ Union of Great Britain and Deliveroo, received a huge amount of media attention. It culminated in the Supreme Court ruling in 2023 that Deliveroo riders are self-employed and do not have trade union rights.
Buying and selling pre-loved clothes has become a huge industry on sites such as Vinted and Depop, with people turning a hobby into a successful business. This industry is under the spotlight after HMRC announced that second-hand sellers who make a profit will be taxed above a certain threshold.
Labour says it will implement considerable reforms to workers’ rights, including a ban on zero-hours contracts, the right to switch off and protection against unfair dismissal from the first day after the expiry of probation. There will also be enhanced legislation around flexible working and parental leave.
These changes could pose commercial and reputational risks to businesses, particularly those relying on zero-hours contracts, as they will need to adapt while still preserving the benefits for those currently classified as workers.
Further media interest will only encourage policy intervention. This means managing corporate reputations is important not just from a communications perspective but also from a business perspective.
Any company with flexible working arrangements must have a crisis and reputation communications strategy in place in advance of the consultations and implementation of new legislation. In today’s fast-moving media landscape, when adversity strikes, even a few minutes of delay in reacting can have a negative impact.
However, there are also proactive PR tactics which can help to strengthen a company’s reputation to attract customers and new hires.
Here we analyse the opportunities and challenges for companies involved in sensitive employment issues:
Opportunities:
- Flexibility and independence: Workers have more control over their work environments, choosing projects that align with their interests and values – plus their lifestyle. They often report being able to balance work alongside other responsibilities, such as childcare. It is also good for young people, particularly students, who want some extra cash without the need to commit to a regular job that keeps them in their university town over holidays. Working parents enjoy the flexibility this type of employment offers to balance home life and a job.
- Enhanced skills and entrepreneurship: Flexible working offers a chance to be entrepreneurial, growing new skills alongside existing jobs. People can build a freelance business alongside other work. A study by Henley Business School found that 1 in 4 UK adults have a “side hustle” – a small business or secondary job in addition to their main career. Many report this is because they wanted to follow a passion or see a challenge they want to solve.
- Can help the most vulnerable get back to work: Flexible working can allow charities to deliver effective services and those wanting to re-enter the workforce, particularly those experiencing homelessness. In fact, in January 2024, the charity Changing Lives called on Labour to keep zero-hour contracts because it helps both its service users and staff. They argued zero-hour contracts helped the charity manage costs, workers be flexible with health and studies, and therefore provide vital services to communities.
Challenges:
- Navigating UK regulations: The Chartered Institute of Personnel and Development estimates that around half a million people work in the gig economy, but this is hard to judge without a recognised, agreed definition of the sector from the UK Government. This has led to questions about employer rights and, therefore, the employer’s moral duty to engage with and take care of its workforce.
- Responding to changing rights: Labour’s plan to prevent gig workers from being exploited and increase job security could also harm those who reap its benefits and is a challenge to many tech organisations that rely on adaptable, low-cost labour.
- Understanding gender imbalance: Often, men can earn a higher income from gig work than women, particularly when it involves cycling or driving. Women are more likely to have a caring role at home, so they are unable to work during peak hours. They can feel unsafe driving or delivering alone after dark, and studies show they can be slower drivers.
As the gig economy continues to grow and adapt, businesses must be alert to how the media will report on the sector in the coming months and how that will impact their business.
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