7 von 7

17. November 2021

Predictions 2022 – 7 von 7 Insights

Future of work – a look ahead

We consider the likelihood of a new deal for gig workers (the Uber effect), what flexible work for all could look like and current trends in the labour market.


Shireen Shaikh

Senior Counsel – Knowledge

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Joe Aiston

Senior Counsel

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Hailing a new deal (the Uber effect)

Not long after the Supreme Court handed down its judgment characterising Uber drivers as workers (February 2021), Uber was calling for an improvement to the rights of platform workers. In its White Paper of August 2021, which bore an uncanny resemblance to a government white paper, Uber painted a picture (with echoes of Matthew Taylor's Good Work Plan) of too many workers with little control over their futures, limited financial security and poor access to benefits.

The answer? A New Deal in which platform workers get, amongst other things, a portable benefits fund, enabling them to move away from the traditional employment model without sacrificing financial security. This is already being offered by the US company Stride. Access to education and training opportunities also featured in Uber's white paper. In short, Uber presented itself as a strong advocate for employment rights. In addition, Uber struck a deal with the GMB in March 2021, recognising the union as having power to negotiate issues relevant to pay and other terms and conditions.

Uber was able to 'own the narrative' and offer itself as the antidote to a move fast and break things culture. There is likely to be more of this in 2022: pre-emptive bids by gig employers to offer to fix a broken deal and somewhat upstage the slow-moving debate about whether employment status will in fact be redefined on the statute books. Notably, there is a private members' bill (unlikely to go anywhere) which calls for a binary dependent/independent status and the government has promised to look at the question of status 'when Parliamentary time allows'. This has the ring of 'please call back, we're busy right now' as the list of things requiring legislative attention in 2022 piles up.

Maybe it's fortunate for gig economy employers that we live in the age of the short attention span. They can capitalise on the public appetite for quick stories and revolution, change not driven by something as organic as a decade long challenge through the courts. Who's got time for that? Even the unions seem to share that sentiment, as evidenced by Sharon Graham, general secretary of Unite who specialises in 'hostile campaigns' and recently expressed the view that the old-fashioned way of seeking change in the workplace, lobbying through Labour party policy papers and briefings, is not fit for purpose any more.

More employers, like Just Eat, are likely to improve their offer to gig workers, regardless of legal classification. This is likely to look like pension contributions offered up front, holiday pay, and in some cases medical and other insurances. Wellbeing, such a precious commodity post-Covid, will no doubt form part of the offering.

In short, gig employers know something positive must be done to head off the crisis of confidence in their workforce model. At the same time, more unions and employee representative organisations (such as Contractors for Justice) are likely to take to the (virtual) streets, naming and shaming employers who fall short of a new deal. As we see in many other areas of public life, campaigning for change through disruption is likely to become more prevalent.

Flexible work for all

At the beginning of the pandemic, there were rumours that working from home would become a day one right. Boris was said to be in favour, rumour had it that the current right to request flexible work would get a massive overhaul. Having launched a consultation in October 2021 (which closes on 1 December 2021), the government has indicated that the current position, of the employer merely having to consider a request, is likely to remain in place. Although the Government may tweak this, seeking views on whether the 8 reasons for refusal still seem valid, and on whether it ought to be possible to make requests more frequently than once a year, no major changes look likely.

The Government has also indicated that it does not see a case for requiring adverts to state whether a role can be done flexibly (on the basis that this may put some employers into a defensive mode). Neither does it intend to publish a prototype 'flexible work policy' as businesses need to find their own way of 'making flexible working part of the workplace DNA'.

It seems somewhat strange, given its conservative and slightly hands-off approach on this, that the government will also be launching a separate call for evidence on how to promote a 'genuinely flexible friendly working culture'. What would this look and feel like? As with many things, Covid has created facts on the ground which mean that workplace culture has already become less centralised, with a built-in assumption that when needs-must, the employment contract has to adapt to individual circumstances.

Whether you buy into Boris's recently expressed view that working from home too much is likely to get you gossiped about and overlooked, or the view of Goldman Sachs' boss that it is an 'aberration', the concept of 'flexible work for all' within the traditional employment model is here to stay. Hybrid and Homeworking policies have been adopted as mainstream and working abroad for part of the year is no longer career suicide.

The concept of 'Anywhere Jobs', could see an influx of foreign talent (if the UK's infrastructure is seen as sufficiently attractive) and a drain of UK talent (to sunnier climes). If we see an increase in professional jobs done, in gig-like fashion, from anywhere in the world, this will inevitably have an effect on workplace culture, wages and terms and conditions. Interestingly, this may erode the distinction between low-paid gig workers and better-paid professional gig workers. If everyone is competing for 'flexicurity' (a coined termed by the EU to connote flexibility and security), what will winning look like?

Turbulent times for the UK labour market

The asymmetries we have seen develop in the UK labour market look set to continue into 2022 and beyond. Adecco describes an 'unprecedented mismatch between supply and demand': shortage of talent and candidates in many sectors, shortage of jobs in others. Professional services firms are offering 'unprecedented starting salaries' to new recruits according to a recent report by KPMG. A survey by a British manufacturers' consortium also shows that shortage of candidates is driving up pay. Unemployment is relatively high at 4.5% yet job vacancies from July to September 2021 rose to 1,1 million, a twenty-year record high. 

In large part, Covid and Brexit have created the perfect storm. That double whammy is behind the well-publicised shortage of HGV drivers, care home workers and workers in the hospitality sector (not to mention pig slaughterers). Yet the Chancellor has described the Government as having a jobs strategy 'that is working'. He points to the fact that there are more employees on payroll than ever before and that mass redundancies following the end of CJRS have not yet materialised. 

Acute skills shortages in certain sectors, such as logistics and construction, have driven up wages. Statistics show an increase in average wages by around 7% compared to 12 months ago. While this could in part be explained by the 'flattening effect' of the CJRS on wages, once that is discounted this could look closer to 4%. There is anecdotal evidence that retention bonuses are on the increase. Reports from recruiters suggest that almost a quarter of employees will be resigning and looking for new jobs in the first few months of 2022. A combination of factors is likely to see bargaining power shift to employees and workers in some sectors.

One thing we can be sure of, the growth in home deliveries, especially takeaways and food, will not relent. This will mean a growth in the gig workforce, and more app-based businesses coming on the scene. The 'new deal' already being offered to some gig workers may see the emergence of a floor of minimum rights over time (and we have yet to see what the EU will do on this front). According to the TUC, there is nothing to celebrate in the fact that the gig workforce trebled in the past five years, with 4.5 million in England and Wales apparently now doing some form of platform work. According to France O' Grady, the General Secretary, this just means poor terms and conditions and pay for a greater number.

Following the TUC's important report on the potentially discriminatory effects of AI earlier this year, as well as some successful challenges in Europe to workplace use of AI, we are likely to see more gig workers in 2022 wanting to know how fair the algorithm is, in terms of allocation of work and assessment of performance. With the EU already proposing to regulate use of AI by means of an Artificial Intelligence Act, and with  work opportunities being identified as one of the fundamental areas of 'high risk', it will not be possible for the UK to adopt a non-committal approach to these issues.

Although unrelated, the introduction of IR35 in early 2021 has led to a policy decision by many employers such as banks to avoid off payroll working altogether. This could account for some of the increase in payroll numbers. Those wishing to provide their services through limited companies are likely to be encouraged to engage with umbrella companies which are in the Government's sight as needing regulation.

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