What does the UK Uber Ruling Mean For The Recruitment Industry?
Friday, October 28, 2016: a date that will go down in recruitment history. On that date, a landmark ruling was delivered by a London employment tribunal meaning that 40,000 UK Uber drivers are set to be entitled to holiday pay, paid rest breaks and the national minimum wage.
But this isn’t merely about the employment future of a taxi app. Uber has become the poster child for an entirely new work model, and the consequences are far-reaching for workers, employers, their HR departments and governments across the globe. The shockwaves will continue to echo for months, if not years, to come. Uber, of course, is appealing the court ruling. Those who have been waiting in the wings for a verdict will now look to follow suit, putting a whole range of companies under the spotlight about how they classify and pay their workers.
The case highlights not just the issue of workers’ rights, but the exponential growth of the contingent market — predicted to be 50% of the workforce by 2020 — and the variety of models and platforms that have evolved to serve these. Jobseekers are embracing and driving the new world of work, forcing legislation and tax systems to play catch-up.
It also places the recruitment industry in a very sweet spot. Now is the time for staffing companies to prove their value as trusted partners by helping organizations to navigate the increasingly complex employment landscape and mitigate their risks, simultaneously helping jobseekers to secure work and enjoy proper employment protection.
Riding on the coattails of “worker misclassification” is not enough though. It’s a cheap ride. Increasingly the media reports that a majority of the“self-employed” elect to work this way as a last resort, rather than through choice. Agencies should look to understand and act on candidates’ drivers and motivations –– their desire to work when and where they want, underpinned by their preferred communication channels (online and mobile).
Uber and its cohorts have raised the game too for employers in the competition for the best available talent. Recruitment talk that for the last decade or so has centered around skills shortages, sourcing and employer branding, has now shifted to that of the gig economy and an on-demand workforce. Tenders are no longer being won on the size of a staffing organization’s database, rather on their ability to connect with and deploy their workforce in real-time.
At TempBuddy, we’ve always viewed the role of the agency as extremely valuable to the gig economy (the descriptor Staffing Industry Analysts now gives to all forms of contingent labor). This ruling demonstrates the risk to workers of allowing external parties to disrupt the industry. In light of the ruling, we’re coming to terms with how we feel about being described by the SIA as offering an innovative way to “uberize” staffing firms’ temporary workforces, helping recruiters focus on what matters most: placing people and making money.”
Workers are being hailed the heroes of the Uber ruling. Forward-thinking, tech-savvy staffing companies could be the winners here too. And, of course, their clients and candidates.
(Previously published at the Staffing Stream by Staffing Industry Analysts)