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Plight of the digital proletariat in an Uber, Ola world

LiveMint logoLiveMint 23-04-2017 Anil Padmanabhan

Last week the Delhi high court threw a spanner in the plans of taxi drivers’ unions in Delhi to disrupt services offered by aggregators Ola and Uber.

The high court reiterated its earlier order prohibiting the unions from forcibly confiscating the mobile devices in the taxis.

Predictably, the strike fizzled out.

While this was the case, the entire episode put the spotlight on an interesting facet of the share economy: the challenges of an on-demand workforce, a digital proletariat as it were.

Yes, while the new economy developed on a peer-to-peer relationship does bring with it greater efficiencies, it completely overturns the traditional relationship between labour and capital.

From the point of view of labour, while it endows them with unprecedented flexibility, it severely crimps their ability to organize class action protests, like what would happen in the past—some may recall the historic textile mills strike in the early 1980s.

Something of that scale is impossible in the new economy.

This backdrop does inject an element of inequity into the employer-employee relationship in a share economy. In the event of a disagreement, the mode of engagement cannot assume traditional contours.

Part of the reason is that the assets in the business of taxi services in the share economy are not owned by the aggregator; instead, it is owned by the driver—effectively transforming them into micro entrepreneurs.

So, while it was relatively easy to lay siege to the asset owned by the mill owner in the event of a textile strike, it is not true of taxi drivers working for an aggregator.

And the high court ruling nixed any ideas that the unions may have had in forcing the taxi aggregators to come back to the negotiating table.

It is some coincidence that the setback to the taxi drivers of Delhi comes just under a fortnight ahead of 1 May, International Labour Day or May Day, as it has come to be known popularly.

It is a tradition dating back to the 19th century, evolving around the struggles of American workers for better work conditions; and has since become a global day of celebration for the working class.

The decline of organized unions—in the backdrop of shrinking mass-based industries such as textiles, automation and the preference of employers for contract employment—has severely dented the normal enthusiasm for celebrations; if anything, it has been reduced to tokenism.

But the recent setback suffered by the taxi drivers signals that an entirely new paradigm is in the making. Even Karl Marx, who fashioned the word proletariat and the rallying cry of “workers of the world unite”, imagined life for the working class in the new economy.

From a scenario, say in my father’s generation, of holding tenure and working a single job till retirement, we transcended into a world of hopping from one salaried job to another. The emergence of the share economy is now transforming this workforce into an army of self-employed.

Not only is this a challenge to the new-age workers, it is also a poser for labour policy.

At present, benefits such as pension and provident fund (which make up the basic social safety net) are restricted to the organized worker—which is less than 10% of the total workforce.

In the new era of the digital proletariat—self-employed instead of drawing a salary—even this will be precluded.

The big question is, who will bear this social cost?

The aggregators will claim that they are mere technology companies who are just providing a matchmaking platform for drivers and customers.

And the workers are in no position to force the issue.

The larger problem is that existing labour laws do not even recognize the new worker-employee relationship, leave alone ascribing responsibilities.

Clearly, there is a challenge in the making.

For now, one can kick the proverbial can down the road, but not wish away the problem. For starters there should be a national debate on this issue and the ideal platform would be Parliament.

Anil Padmanabhan is executive editor of Mint and writes every week on the intersection of politics and economics.

His Twitter handle is @capitalcalculus.

Respond to this column at anil.p@livemint.com

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