By Sandra Hanisch, ZenJob
When we are talking about diverse forms of work there are two buzzwords coming up in every conversation in this discourse — whether it takes place among scientists, platform operators, employees or other stakeholders. The two terms which are key to every discussion are flexibility and security. Everybody involved in diverse forms of work agrees that we want to bring more flexibility into our working world. On the other hand, everyone is also aware that we must not lose safety at the same time.
The concept of flexible work is nothing new and has been around in certain areas for a long time. The only thing that is quite new are the possibilities to organize work flexible via digital platforms or digitalization in general. It is easier and more visible and the percentage of people involved in the so-called platform economy is rising. Around 11% of the workforce in the EU say they have already provided services via a platform. Some forms of work were called atypical work a few years ago, but this impression has changed dramatically. Working 9–5 is no longer the normality, working for one company your whole life is no longer normality, working at times which are set by the employer is no longer normality. People want to work where, when, and for whom they like. The organization of work via digital labour platforms is just the answer to this need. But at the moment, our European employment relationships cannot fully cover flexibility and security at the same time. Whether you are employed or self-employed, both forms of work can not satisfy both parts of the needs. For example, self-employed do face some challenges, as they are not automatically involved in the social security systems and do need to organize social security schemes mainly for themselves.
There is a sociological expression which perfectly combines both of the terms: flexicurity. Flexicurity does not promise to dissolve institutional processes, but to reshape them while balancing the ambivalences of flexibility (Kronauer, Linne 2005: 9).
At the macro political level, the issue is the design of labour markets and, in connection with this, the design of social security systems. Flexibilization is often associated here with deregulation (not mere elimination of norms, but adaptation to market logics). Microeconomic flexibility, on the other hand, refers to the reactive or active adaptability of companies. Adaptability should always be interpreted here in terms of economic, technological and social conditions. Thus, flexibility on the company side primarily affects organizational and control structures, personnel deployment, work allocations and cost structures.
The European Commission also describes the term flexicurity as an integrated strategy for enhancing flexibility and security in the labour market at the same time. The key principles linked to flexicurity are defined as flexible and reliable contractual arrangements, comprehensive lifelong learning strategies, effective active labour market politics and modern social security system. In this sense the Commission already has the answer on how to regulate platform work.
One of the first attempts in flexicurity terms at a national level has been the Hilfr agreement. The cleaning platform Hilfr and the union “The United Federation of Danish Workers” negotiated this agreement, which was one of the first good examples for collective bargaining in the platform economy. One of the basic outcomes was that the employees working through the Hilfr cleaning platform were able to choose their employment status after a certain amount of working days as a self-employed. They have been given the opportunity to decide whether they would like to stay self-employed or switch to the employment with the platform (for more, see here). This is a very good example for a first step in the power shift towards the employee and can be seen as a model to build upcoming regulations on. In the general international debate, Denmark enjoys a special reputation as a reference country and serves as a kind of model for the implementation of the flexicurity approach. Denmark is characterized by high numerical flexibility in the labour market combined with low job security. However, it has a high level of income and employment security, which is achieved by actively increasing the employability of its citizens. The Danish flexicurity model is often described as a “golden triangle”. It combines high mobility between jobs with a comprehensive social security net for the unemployed and activating labour market policies. But there are also other countries with good approaches. A more advantaged and concrete micro level possibility of restructuring with the inclusion of the needs of the employees would be an employment model, which brings with it all the advantages of an employer — employee relationship, but still offers enough freedom for the flexible scheduling of work-related activities. To make life and work more compatible people need to be able to choose, especially when and how often they would like to work. Self-employment, as it is structured nowadays, does not fulfil this criterion. People are not really free to choose most of the time, as they are depending on certain orders and do not have efficient security schemes. For example, around 60 percent of self-employed Germans complain about a loss of income, compared with around 15 percent of dependent employees (see more here)
For example, in Germany there is also one model which offers the employer-employee relationship and guarantees flexibility to a certain amount. The so-called “Kurzfristige Beschäftigung” (in English: short-term employment) is one good option to employ people, but also guarantee them the flexibility needed. People in this contractual employment are free to choose for whom, when and how often they want to work up to 70 days a year. There is no commitment to certain hours of work and thus there is a power shift towards the workers. The limitation to 70 days per year stems from the fact that this employment relationship originated in agriculture and is used a lot for seasonal workers.
However, this form of employment can be wonderfully harnessed in combination with job placement via digital platforms in a sustainable way. Short-term employment or “Kurzfristige Bschäftigung” is a common form of employment, which is completely regulated at the national level and can be clearly defined from a legal point of view. However, there is one major drawback: this form of employment is not subject to social insurance contributions. Accordingly, this form of work would also have to be included in the social security system in order to comply with the flexicurity approach. One possible practical implementation here would be to increase the maximum number of working days while at the same time establishing a layered system for social security. For example, working in a “Kurzfristige Beschäftigung” up to 30 days a year could still be free of social security contributions, but working up to 50 days might be charged by 3% of the income for the employee as well as for the employer. Working up to 70 days might mean a 5% contribution and so on. If this approach might be combined with a central inspection body that checks the working conditions on the platforms and gives them a seal of approval, fair conditions can be created. This inspection body needs to be an institutionalized system of reviewing the working conditions on different platforms. Some sort of cross-national institution with the authority to stop platforms from operating, if they do not fulfil certain criteria for decent work. Based on the flexicurity principle, the advantages of platform work could thus be made sustainably usable. Topics touched by the inspection body might be wages, terms and conditions or contracts, algorithms or health and safety of workers. Platforms which don’t reach a certain score after rating the fairness in these topic areas might get deactivated by the government or at least might not get the seal, which sufficiently scoring platforms might get. With this initiative the inspection body would have the possibility to put more pressure on the platforms and to make working conditions on the differing platforms visible.
Flexicurity thus seems to be the perfect solution to the issue of regulating diverse forms of work. The combination of flexibility and security is exactly what employees and self-employed people want. It also accommodates the social security system and is a suitable structure for employers. It helps to figure out which regulations are needed to satisfy the future and current workforce. In this sense the flexicurity approach somehow already offers the solution for the future of work. Now we only need to take it and apply it to modernize our working world.
References:
- Kronauer, Martin; Linne, Gudrun (2005) Flexicurity — Die Suche nach Sicherheit in der Flexibilität. Berlin: edition sigma.
The opinions and views expressed in this publication are those of the authors. They do not purport to reflect the opinions or views of Reshaping Work.