In the past couple of years, the gig economy – specifically the food delivery sector – has experienced a burst of demand as a result of fundamental shifts in consumer behaviour. The delivery boom has also created a massive new sector of employment that has pulled in a diverse demographic of workers from various backgrounds.
Food delivery workers are now part of a growing workforce comprising contract-for-service workers (who have client-contractor relationships) instead of one that is between an employer and employee.
While food delivery is not a new concept, the development of this industry is unique – delivery personnel are directed and engaged by digital platforms with limited human interactions and inputs. The reorganisation of work processes, in conjunction with unprecedented contractual arrangements today, has resulted in novel work regimes. The traditional framework of full-time stable work is now being challenged by on-demand freelance hire.
EMPLOYMENT STATUS OF THE FOOD DELIVERY WORKER
There are misconceptions about the relationship between food delivery riders and the platforms they work for. Some hold the mistaken notion that they are gig economy workers, who are employed by companies that supply goods or services the workers deliver.
In his 2017 speech on the Central Provident Fund (CPF) and the gig economy, former Manpower Minister, Mr Lim Swee Say, elucidated the distinction between gig workers and freelancers . He said gig workers can be employees or freelancers. He cited the example of a private car driver, who joins a transport company with an employment contract while taking on jobs offered via apps.
In such instances, while the driver is in the gig economy, he remains an employee protected by labour laws because there is an employment contract between him and the car rental company, even if he is on a short-term employment contract.
The driver is deemed to be under what is termed as ‘contract of service’ (note the word ‘of’). However, if one provides a service in return for a fee without entering into any employer-employee relationship, and is not overly constrained by conditions imposed by the platform owner or service buyer, then one is a freelancer; this is termed as ‘contract for service’.
Given their relationship with the companies that own food delivery platforms, food delivery workers are actually gig freelancers. They are known as own- account workers in the Manpower Ministry’s labour force surveys. They are also considered self-employed persons (SEPs) by the CPF and Inland Revenue Authority of Singapore.
According to former Member of Parliament, Mr Zainal Sapari, workers providing services for ride-hailing firm, Grab, and food-delivery service provider, Deliveroo, for example, are not employees; instead, they are independent contractors, who are not entitled to statutory or other benefits.
Independent contractors like the food delivery workers are, therefore, not covered by the Employment Act, and statutory benefits such as working hours and leave entitlements do not apply to them. Thus far, the impact of these developments in Singapore has been subjected to limited empirical investigation.
The Centre for Research on Islamic and Malay Affairs (RIMA) conducted a qualitative study on 60 food delivery workers in Singapore from August 2019 to August 2020. This study aims to seek clarity on the different types of food delivery workers, the reasons why they joined the business, and how they utilise and enjoy the perks, and overcome the perils that come with the job.
More importantly, it also expounds on how food delivery workers view long-term employability and what actions are typically taken to ensure that they do not descend into a vicious cycle of adverse socioeconomic outcomes – especially when the industry, market and consumer trends do not work in their favour all the time.
The RIMA study also points out that more often than not, these workers are youths, housewives, middle-aged, retirees, ex-offenders and the disabled. This trend is made especially possible by how easy it is to be a food delivery worker. Almost anyone can apply without going through a selection process. The cost of capital – bicycles, personal mobility devices (PMDs) or power-assisted bicycles – is also affordable to many, given the various schemes available to acquire them.
OPPORTUNITIES AND CHALLENGES FOR FOOD DELIVERY WORKERS
The RIMA study also cited several pull and push factors why people join the food delivery business: attraction to its flexibility, a growing preference for autonomous work arrangements, reliable payment methods and monetary incentives, peer influence, low barriers to entry, and utilising free time and personal vehicle.
When asked about their future in food delivery, the participants’ responses were varied. Those who have been in the mix longer have seen incentives declining over time. They are less optimistic about how earnings from food delivery work will fare in the longer run.
However, there are also those who feel that the industry will remain stable. While they acknowledge the possibility of technology displacing their roles, the participants believe that it will be a long time before human deliverymen will be displaced from their jobs.
Do they plan to leave the industry in the near future? Well, the responses were also mixed. While some are satisfied with the job, others opt to stay as long as the gig is around due to a lack of alternative employment opportunities. Among those who view food delivery work as a short-term prospect, the majority of them also see it as a milestone in their career. They also think that it is fine to turn to food delivery work as an interim source of income while searching for something more permanent to come along.
When it comes to challenges, many of the participants share similar concerns. Most of the issues centre on the food delivery company and/or the workers themselves. In these cases, the participants shared the difficulties in managing the expectations of customers and merchants, delay in responses from management, the changing terms and conditions of incentives, and the allocation of trips by food delivery companies.
Other concerns include a lack of flexibility and accessibility for riders like the disabled, an absence of basic benefits such as medical leave, and the recent restriction of using PMDs on footpaths.
FOOD DELIVERY WORK: GOOD OR BAD?
The food delivery industry has helped open new doors of employment with some of the biggest beneficiaries including individuals who normally have limited access to conventional jobs and are less capable of accepting traditional work arrangements. However, as the RIMA study suggests, there are concerns expressed by the food delivery workers about the working conditions that they are subjected to, and the challenges they experience when delivering food.
The nature of the work, for instance, does not help them build skills over time; thus, their longer-term employability is a major concern. The industry itself is also fraught with uncertainty. While it is hard to foresee such work being displaced by technology in the immediate term, it is worth noting that it all began with a single innovation i.e. an application, and there is no telling if another innovation will render food delivery work redundant.
In addition, food delivery is also largely dependent on the market’s volatility and consumer trends. As the COVID-19 pandemic has shown, a shock could change any industry’s configuration considerably. As other sectors are grounded to a standstill, the demand for food delivery business has increased by about 20 to 30 percent since a ban on dining outside started on 7 April 2020; many flocked to the business for income.
While one may argue that this is only a temporary reorientation, many consumers who are not accustomed to using an app to place orders for food now have learned of its convenience. Likewise, many workers who entered the food delivery business at the height of the pandemic now have acquired its benefits. These experiences are likely to induce lasting changes in consumer and market trends.
With a larger number of food delivery workers in the business, their well-being in terms of financial health, and long-term employability and career progression become matters that need to be treated with greater urgency. Failure to find solutions to ensure a good work platform would increase precarity and insecurity for these workers. It is, therefore, critical to address these issues to prepare adequately and plan good outcomes for them, as well as general workers, in advance.
For instance, food delivery work may not necessarily be bad for all groups; thus, there is a need to recognise the diversity among them and understand their needs and calibrate interventional measures accordingly. There is also a need to protect those wanting to stay as SEPs by compensating those wishing to upgrade.
Social service agencies should also reach out to food delivery workers in unconventional ways. They could organise dialogues on the workers’ future, and help introduce bridging programmes to help those with lower educational attainments or who find learning curves too steep.
Indeed, the food delivery platforms are providing flexible opportunities to earning income, helping many workers achieve economic security and greater control over their working hours.
For some, it is often riskier but a more lucrative pursuit compared with other available jobs.
For others, who are desperately seeking an immediate income, it can be a lifeline.
1 MINISTRY OF MANPOWER. SPEECH ON CPF AND GIG ECONOMY BY MR LIM SWEE SAY, MINISTER FOR MANPOWER, AT COS 2017. 2017, MARCH 6. RETRIEVED FROM:HTTPS://WWW.MOM.GOV.SG/NEWSROOM/SPEECHES/2017/0306-SPEECH-BY-MIN-LIM-ON-CPF-AND-GIG-ECONOMY-AT-COS-2017
2 CHENG, K. PROTECT FREELANCERS UNDER THE EMPLOYMENT ACT, MPS URGE. TODAY. 2018, NOVEMBER 21. RETRIEVED FROM: HTTPS://WWW.TODAYONLINE.COM/SINGAPORE/PROTECT-FREELANCERS-UNDER-EMPLOYMENT-ACT-MPS-URGE
3 TOH, T. W. FOOD DELIVERY SECTOR BOOMS IN A TIME OF CORONAVIRUS. THE STRAITS TIMES. 2020, APRIL 26. RETRIEVED FROM: HTTPS://WWW.STRAITSTIMES.COM/SINGAPORE/TRANSPORT/SECTOR-BOOMS-IN-A-TIME-OF-CORONAVIRUS
This commentary was also published in Karyawan, A Magazine by AMP, January 2021, Volume 17, Issue 1
Nabilah Mohammad is a Research Analyst at the Centre for Research on Islamic and Malay Affairs (RIMA). She holds a Bachelor of Science in Psychology and a Specialist Diploma in Statistics and Data Mining.
Photo Source: The Karyawan