The gig economy – an opportunity for co-ops and trade unions to work together?

Co-op Congress heard from John Park from Community Union and Sarah de Heusch of co-op gig platform SMart

The self-employed sector continues to expand across the UK, accounting for 4.6 million people in 2015. And with more than two million freelancers operating in the the country, trade unions are looking at how they can engage with this workforce. Can co-operatives also help?

John Park, assistant general secretary and director of strategy at Community Union, explored how trade unions could respond to this trend in his keynote presentation as Co-operative Congress in Wakefield, an annual event hosted by Co-operatives UK.

Trade unions are facing challenging times, having lost 275,000 members (4.2%) in 2016 alone. Over six million people across the UK are trade union members, but only 13% of those working in the private sectors are members.

“Those who need trade union membership most, such as the ones employed in the gig economy or working as contractors, are less likely to be members unlike those in traditional employment,” said Mr Park.

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He added that while regular trade union members paid a monthly subscription, those working in precarious work or the gig economy might not be paid on a monthly basis and may have irregular payments.

“We need to be more realistic about people joining trade unions and how they contribute to a trade union,” he said.

Mr Park defined workers in the gig economy as those engaged and working through a platform through which do not have the same safety net, or the same forms of protection as in normal form of employment.

He called on co-ops to work with trade unions to help identify a strategy around the future of work. Community trade union has been working with a Welsh based community benefit society, IndyCube, which runs over 30 co-working spaces. The bencom and the trade union launched a joint online platform aiming to not only extend the network, but also provide the self-employed and freelancers with advice and legal representation.

Mr Park said such partnerships between co-ops and trade unions could be the way forward, particularly around the ownership of gig economy platforms. “If you are a trade unionist make sure your organisation has a better understanding of what a co-op can provide,” he added.

In Belgium, a co-op is already pioneering such a model. Having started a small non-profit which wanted to support artists, SMart has grown into a network of 80,000 autonomous workers and freelancers from different sectors. Founded in 1998, the enterprise converted into a co-op in 2016, after deciding the model was better suited to meet the needs of its users. All profits are redirected in either improving the services or providing new ones.

Members of the co-op benefit from legal and administrative services, insurance for accidents at work, cash and financing services, co-working spaces as well as support and advice. They also get paid within seven working days of doing the contracts.

The co-op works to remove extra burdens on freelancers, who often have many contractors, work abroad and have to deal with complex administrative and legal frameworks.

“A lot of people were not invoicing, they were working undeclared because they were afraid if they declared something wrong it would cost them more,” said Sarah de Heusch, project officer at the co-op.

“Through the co-op, people are not afraid of declaring anymore because they can do it using our tools,” she added. “We have developed simple contract tools and use a software to help in the process.”

Last year, SMart was able to reach an agreement with Deliveroo which enables freelancers to benefit from a minimum hourly pay rate, a minimum working time, insurance against injury at work and social insurance.

According to Ms de Heusch, SMart’s model is sustainable. The co-op charges a 6.5% levy on every contract they have, which, she says, enables them to function and pay the benefits injected in the services.

SMart has expanded and now operates across other European countries: Germany, Spain, France, Italy, Hungary, Netherlands, Austria and Sweden.

“SMart does represent and support members and takes legal action as well to defend workers’ rights. We believe that unions can do that better than us but they need to embrace freelancers as well,” said Ms de Heusch. “We need to work together as trade unions sometimes don’t understand new economy workers and we have experience in this sector.”