The UK’s labour market is evolving, social media has become intrinsic to daily life, and the rules of industrial and employee relations are being rewritten.
While the Government’s Good Work Plan set for implementation in early 2020 has outlined a vision to address many of the fresh challenges arising from the gig economy. HR and Employee Relations (ER) leaders cannot be complacent about waiting for these proposed changes to take effect. Nor can they underestimate the power of social media to put their organisation in tomorrow’s headlines. They need to be aware of the shifts in traditional collective relationships – and the move towards more fluid, advocacy-based protest.
In June 2019, we saw a clear example when it was widely reported how Mexican restaurant chain Wahaca was driven to reassess a business practice overnight.
In one of its London outlets, as per company policy, a waiter was asked to contribute towards the bill of the customers she’d been serving as they had left without paying. Having witnessed this in person, a former Labour leader of Camden Council took to social media to denounce the practice. By the following day – once the story had been propelled by social media – the company had speedily changed the unpopular policy.
It’s the latest in a series of incidents where companies have been forced to very quickly address an industrial relations issue laid bare in an incredibly public arena.
The unions in this country have traditionally held the role of seeking improvement in working conditions –through organised, collective action and a strong hierarchical membership base. But their role today is under challenge from declining membership, constraints on industrial action and a more fragmented labour market. The gig economy has created a new genre of worker who has different employment challenges, perhaps even multiple employers. At the same time social media has provided a populist platform for calls to collective action in a much more fluid and reactive way.
Taken together, these trends have important implications for HR and ER leaders looking to meet the needs of their employees and minimise the likelihood and impact of an ER issue such as Wahaca’s.
The strength of the UK’s gig economy
Over the last 25 years, the British labour market has become increasingly fragmented.
Pressures on industry have grown, outsourcing has increased, employment patterns have fundamentally changed, and of course, mobile internet use has exploded. A recent government study estimated that 2.8 million people had, at some point in the previous 12 months, been employed in the UK’s gig economy – commonly defined as “a labour market characterised by the prevalence of short-term contracts or freelance work, as opposed to permanent jobs”. And the majority of these workers are young, with 56 per cent aged 18-34.
While some see the gig economy as empowering its participants with more flexible working opportunities that perfectly suit modern lifestyles, other say it’s exploiting them with very little workplace protection. One thing is clear: it presents a challenge to traditional models of collective action and how employers respond.
Trade union member numbers are dropping
As the UK’s labour market has evolved, traditional trade unions are having to fight to maintain their sphere of influence. Union membership is lower among both those with shorter stints of employment and younger workers. In 2018, only 4.4 per cent of union members were aged 16 to 24. This statistical data aligns very closely to the demographic of the gig economy workforce.
The mismatch compounds a long-term decline in overall union membership, which has been particularly marked among manual workers and those in the private sector. Looking back at recent decades, of all employees:
- 50 per cent were union members in 1980
- 30 per cent were union members in 2000
- 27 per cent were union members in 2010
- 23 per cent were union members in 2018
And in recent years unions have also faced legislative constraints on their ability to take industrial action, particularly around balloting.
The changing face of industrial relations
With declining union membership, industrial relations conversations are moving to a less predictable, less structured space where individuals can be directly heard and movements can build in hours.
From smartphones to 4G to social networks, the technologies that have helped enable the gig economy are now providing a new and powerful medium through which its fragmented workforces can make themselves heard.
Spontaneous strike action taken by UberEats couriers in autumn 2018 provided a collective voice for gig economy workers dissatisfied with changes to the company’s remuneration policies and feeling like their objections were being ignored. By taking advantage of WhatsApp groups they rapidly co-ordinated strikes in several cities.
Later they would occupy the lobby of Uber’s London offices, and even target its supplier relationships, engaging workers at TGI Friday’s McDonald’s and Wetherspoons in joint action.
As such cases demonstrate, UK workers now have the digital means to:
Rapidly organise collective action without the need to mobilise under more formal unionised structures. Contact and engage other groups with aligned interests. Gain the attention of a connected society that’s quick to react to and vocalise their concerns about practices they perceive as unjust.
What key questions must HR and ER leaders ask themselves?
In this new era of industrial and employee relations, HR and ER leaders need to ask a number of questions about their organisation’s approach to IR issues:
- How are we getting feedback from our workforce? How regularly do we do this and do we provide options spanning open, confidential and anonymous lines of communication?
- Do we have formal union relationships?
- Are they being leveraged effectively? Are there any gaps? Have we redressed these relationships in the social media era?
- What additional feedback processes do we need to put in place?
- Are our policies transparent and accessible?
- Would we be able to respond rapidly to an IR issue that went viral on social media?
A time for reflection, analysis and transformation
The industrial relations rulebook is being rewritten. Employers in all industries need to carefully consider their response – or risk falling out of step with both their workers and public opinion.