Time to regulate the gig economy?

Regulations may provide some restrictions to the ones involved, but to avoid any issues of mistreatment and exploitation, it needs to be done fast


EARLIER this week, hundreds of food delivery riders from Foodpanda launched a strike against the company’s new payment scheme.

In a statement over the weekend, Foodpanda MD Sayantan Das said that the scheme — which would involve riders outside the Klang Valley — would enable them to earn more based on the orders that they accept.

He said that company had also increased the rate per order that a rider carries out. Based on the company’s new system, a rider who previously earned RM5 per order would now receive RM7. They would also receive a RM100 bonus if they complete 60 hours a week.

However, the announcement somehow sparked a protest and strike by the riders nationwide.

The riders claimed that their earnings would decrease and that they would also have to work longer hours too.

As of yesterday, there was no further statement from the food delivery company but Youth and Sports Minister Syed Saddiq Syed Abdul Rahman had taken the initiative to meet with the management of Foodpanda to deliberate further on the matter.

Syed Saddiq, who has been an active advocate of the gig economy — which he described as one of the future economic drivers for Malaysia — emphasised that the riders’ rights and livelihood should be protected under the scheme.

Separately, the Human Resource Ministry said the government would be working with Foodpanda to ensure a win-win solution on this issue. While Syed Saddiq’s quick and hands-on involvement is applauded, the bigger question would be how to avoid similar cases from happening.

By definition, the gig economy is characterised as flexible employment compared to conventional jobs.

The rapid emergence of the gig economy worldwide had also sparked an in-depth conversation on how the industry would move forward while the workers’ welfare is protected.

World Bank had predicted that by some measures, in 2020, 40% of US workers will be in non-standard jobs to either fill some part-time roles or working as freelance contributors in the technology platform.

In Malaysia, according to the Employees Provident Fund, the gig economy has grown by 31% in 2017, a growth figure that had surpassed the conventional workforce.

It is expected that the number would expand within the next few years.

Critics have long pointed out that the workers participating in this global trend are prone to be exploited by corporations. They argued that while the industry growth is imminent, it is not meant to be a long term solution for unemployment.

It is a temporary respite for the symptom, to fill the unemployment gap, but without any job security and long-term financial saving, the workers would stand to lose more in the future.

As it is, the government had taken an unpopular move to regulate e-hailing firms. It may not please some quarters but for the sake of a greater good, the regulation needs to be done, to ensure no one would be taken advantage of — be it the workers, firms or customers.

Perhaps, now is the time to introduce a new set of regulations for the firms and workers who are involved in this industry.

Regulations may provide some restrictions to the ones involved, but to avoid any issues of mistreatment and exploitation, it needs to be done fast.

Failure to address the challenges in the gig economy could be detrimental to the nation and society in general.

Azreen Hani is the online news editor of The Malaysian Reserve.