Around the world, the so-called gig economy is starting to lose its lustre.

In the last few months alone, London’s transport agency has stripped Uber of its licence over a lack of corporate responsibility.

The European Commission has backed a proposal for tougher protections for people working in the flexible economy.

And here the Fair Work Ombudsman is investigating whether Uber’s contracts with drivers breaches Commonwealth workplace laws.

Yet the Turnbull government seems to be heading in the other direction.

In an announcement snuck through on the day the country was watching the Yes vote, Social Services Minister Christian Porter revealed a $1.4 million pilot program to get young, unskilled job-seekers into the gig economy, as part of a broader package of welfare reforms.

Labor and workplace lawyers say the program will end up pushing vulnerable people into insecure, low-paid and often dangerous jobs.

But the government says the pilot, which will run in Melbourne, Perth and Hobart, is simply designed to be a leg-up into the workforce.

“Placing young unemployed Australians into viable employment positions in the gig economy is a means of breaking cycles of welfare dependency,” Mr Porter told Crikey.

“[It] acts as a stepping stone for further ongoing employment opportunities.”

The government says the program will connect job-seekers to tasks including “gardening, driving and delivery, catering and hospitality and child minding”.

Consulting firm Nous, which designed the program with charity group Whitelion, told Crikey that Uber, food delivery company Deliveroo and online jobs marketplace Airtasker were among the companies it was hoping to promote.

“Deliveroo in particular is quite a good example. You’ve literally got to get on your bike and away you go,” Nous principal Zac Ashkanasy said.

But Mr Porter said no formal arrangements with companies had been made.

Whitelion is expected to administer the program and pay participants a wage while they sign up for tasks. Participants will receive two weeks’ general skills training before signing up to tasks on the digital platforms.

Labor has already attacked the project, saying it will push vulnerable workers into even more vulnerable situations.

“There are big questions marks as to how the government’s Y4Y program will work and how it will avoid exploitation of workers in the gig economy,” opposition employment spokesperson Brendan O’Connor told Crikey.

Workplace lawyers have also raised concerns, saying it comes at a time when regulators around the world – including in Australia – are closing in on the gig economy.

“I find it quite surprising that the government is going to set up a sort of portal to the gig economy given the concerns around these companies,” Maria Nawaz, a solicitor with the University of NSW’s Kingsford Legal Centre told Crikey.

“There are significant concerns that these companies are possibly exploiting loopholes in the law and engaging in sham contracting.”

But Mr Porter said these concerns missed the point.  

“To characterise the Y4Y Youth Force initiative as simply placing young unemployed Australians into employment with Uber is a gross over simplification,” he said.

The Fair Work Ombudsman’s investigation into Uber is ongoing, and will have widespread ramifications for how the gig economy classifies workers in Australia.

Currently most platforms classify workers as self-employed, or independent contractors, meaning they are not entitled to a minimum wage, superannuation, annual leave pay, sick pay or any workplace safety protections.

The government says it will work closely with the selected service providers to ensure “full compliance with relevant workplace laws”.

But Sarah Kaine, an associate professor of management at the University of Technology Sydney Business School, said Australia had clear provisions around sham contracting that were yet to be tested.

“I’d be very concerned that we’re sending disadvantaged workers out to work in this environment,” she said.

Nous said the program was not designed to make vulnerable people more vulnerable.

“We’re trying to figure out a way to use the gig economy for good,” Mr Ashkanasy said.

“The real growth in employment in Australia is in part time and casual employment. You can argue the pros and cons but the reality is that casual work is providing opportunities for people who were previously unable to work, or work full time. And that’s been partly driven by the gig economy.”

Airtasker chief executive and co-founder Tim Fung told Crikey he welcomed any involvement in the program.

“It’s certainly a really, really great opportunity for us, if we can help out young people get a start in their careers,” he said.

Airtasker has 2 million registered users in Australia and takes a 13.7% cut of wages earned by its users.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey