Introduction and Objectives

This article considers some ways of working that depart from traditional forms of work. Traditional work generally provides employee status and work relationships are typically tightly regulated by legislation, social dialogue and individual contracts (Leighton & Wynn, Reference Leighton and Wynn2011). Onto these relationships are grafted social rights and protections, including pensions, which are generally seen as part and parcel of what ‘work’ means. This notion of traditional employment has brought stability and predictability to the workplace. When things go wrong, there are procedures and institutions to help resolve them in most jurisdictions.

For a variety of reasons this picture is changing, with increasing numbers, especially knowledge workers, seeking the ability to determine their own working life (Institute of Public Policy Research, 2015) These are the independent self-employed professionals (IPros), whose numbers have grown by 45% across the EU in the last decade (Rapelli, 2012; Leighton, Reference Leighton2013; International Labour Office [ILO], 2016). IPros are typically well educated and skilled. They are of increasing importance to creative industries (Dellot, Reference de Flamingh and Cameron2013), health care, education and wide range of professional occupations, such as engineering, journalism, translation, consultancy and to liberal/regulated professions such as lawyers and accountants (Rapelli, 2012; Solicitors Regulatory Authority and the Legal Services Board [SRA/LSB], 2015).

Employing organisations, too, are changing. Many see the value of using independent, more flexible and agile workers (Burke, Reference Burke2012; Ackers, Reference Ackers2014). Despite growth and evidence of emerging recognition by legislators and policy-makers (Cooper, Reference Cooper2006; European Commission [EC], 2012, 2014), people working for themselves but not aiming to employ others often find themselves as ‘outsiders’ and hard to define. They are not clearly within the small and medium enterprises (SMEs)/entrepreneurship community, or unambiguously subject to labour market provisions (Leighton, Reference Leighton2011). Questions of definition and categorisation have therefore proved problematic for this group.

There are many drivers of change, though a desire for personal autonomy features strongly (Mckeown, 2009–20Reference McKeown15; Gratton, Reference Gratton2011; PriceWaterhouseCoopers [PWC], Reference Pofeld2016). However, probably it has been the opportunities provided by Information and Communication Technology (ICT) and internet platforms that has had major impact (Pelissie du Rausas, Reference Pelissie and du Rausas2015; Carbonaro, Reference Carr-Saunders and Wilson2016). This has enabled various forms of intermediation being used to bring skills/facilities providers and seekers together, and the development of new ways of providing services (European Foundation (EF), Reference Dygryse2015; NESTA, 2015). Uber, the taxi service, is perhaps the best known of these internet-based service providers, although there are growing numbers and variety in services being provided this way and we seem to be in the midst of creating a complex and fast moving picture of service delivery. Just as the issue of being nontraditional creates challenges for individuals who work for themselves, technology is rapidly challenging the ways that work is accessed and undertaken and, importantly, presents major challenges for the nature and effectiveness of work relationships (Leighton & Mckeown, Reference Leighton, Syrett, Hecker and Holland2015).

These new ways of working and service delivery, often referred to as the ‘gig’ or ‘digital’ economy are typically unregulated or only very lightly regulated (Marchington, Grimshaw, Rubery, & Willmot, Reference Marchington, Grimshaw, Rubery and Willmot2004; Friedman, Reference Friedman2014). As such, they are raising a range of issues, especially legal ones, from consumer protection, through to accountability and liability. This is leading some to ask whether and how these new ways of working should be better controlled. Many of these ‘control’ issues are already familiar to analysts of the world of the IPros and their ways of working. This because of the sometimes uneasy relationship or even major disputes between liberal/regulated professionals and those, often engaged in similar work, that are less or unregulated. It is often argued that regulation of professional work is simply disguised protectionism and the prevention of competition which, in turn, inhibits innovation and efficiency. Those who are subject to regulation generally reject this, instancing the long period of training and lifelong learning that many liberal/traditional professionals are subject to (Kenny, Reference Kenny2014; SRA/LSB, 2015).

It is suspected that more complex work patterns and means of service delivery can only generate even more debates and uncertainties (Stone & Arthurs, Reference Spreitzer, Bacavice and Garrett2013) However exciting, novel and attractive some of these ways of working are, there is an imperative to have a long hard look at them and ask some basic legal and practical questions (Ghosh & Malloy, Reference Giddens2011). The fact that labels such as ‘innovative’, ‘collaborative’ and ‘sharing’ are attached to various ways of working cannot lessen the imperative to question. It is argued that the most basic and urgent question is that of the role, nature and relevance of regulation (Campbell, Reference Carbonaro2010; Coopman, Reference Cooper, Mitchell and ThiererMitchell, & Thierer, Reference Cooper, Mitchell and Thierer2014). The current mantra of governments, businesses and policy-makers has been to call for deregulation and the removal of so-called ‘red tape’. They argue that innovation and creativity are stifled by regulation, that individuals and businesses thrive in regulation-free environments and, anyway, the market and consumers will safeguard proper standards and quality in service delivery.

The Aims of This Article

This article aims to reflect on these changing work practices, drawing on relevant research, including interviews and case studies, as yet unpublished, undertaken by the author of this article. In efforts to suggest appropriate frameworks and policies for successful IPro working, the controversies, conflicts and litigation, especially concerning Uber, are reviewed (EF, 2016). It is argued that allowing work practices to operate entirely freely, however much that may generate competition, innovation and disruption, may be ill-advised. In the interests of supporting independent working and establishing ways to sustain it, appropriate frameworks need to be established to maintain and enhance work experiences (Carbonaro, Reference Carr-Saunders and Wilson2016), but also to protect consumers and support efficiency.

New Ideas and New Power

Sometimes a theory, the findings of a research project or an initiative captures the imagination not just of academics but of policy-makers, the media and the general public. Recently, and perhaps in part as a dimension of emerging from the 2007 global recession, imaginations have been captured by notions of a new sharing and collaborative economy. The professional self-employed IPros, are especially attracted by working on a collaborative basis, as it is they who are increasingly populating coworking spaces, setting up cooperatives, creating new networks and working on an associative rather than employment contract basis. Developments in ICT have clearly made working collaboratively, along with working cross-border and working in more flexible ways both feasible and attractive.

A trigger for the interest and excitement about what can be seen as a radical critique of current business practices and work relations was an article published in December 2014, though others had written about the topic previously (see e.g., Gratton, Reference Gratton2011; Mettler & Williams, Reference Mettler and Williams2011). In the article, Heimans and Timms (Reference Heimans and Timms2014) argued that ‘new power’ is set to challenge or even replace ‘old power’ regarding the ways that businesses are conducted. This would be especially in terms of their relations with consumers, and how products and services are delivered but also how skills are accessed. A particular target for the article’s authors are large and dominant multinational companies which are characterised by being hierarchical, formal, secretive, leader driven with top down decision-making processes, which are also typically unresponsive to external interests and are aggressively competitive. Several major multinationals, such as Apple, Walmart and Nike, despite being brand leaders, are generally considered ‘old power’.

‘New power organisations’, according to Heimans and Timms (Reference Heimans and Timms2014), are characterised by being participatory, peer driven/flat, open, innovative and forward-looking and have values based on sharing and collaboration. They suggest that Wikipedia, YouTube, Wefunder, the Alpha Course and the providers of other platforms that link service providers with customers are key examples. These include Airbnb, VRB, Lyft, Kabbee. However, they devote considerable time to the taxi firm Uber as perhaps the ‘classic’ example of new power. Uber uses sophisticated software to enable potential taxi passengers who have a particular app on their mobile phone to contact the company (Roy Morgan, Reference Richardson, Kakabdse and Kakabadse2016a), explain where they are and want to go and they usually pay Uber in advance by credit or debit card. In effect, the platform acts as an intermediary, linking individuals with the services they want to access. The promotional literature of Uber stresses that the people involved have an informal relationship and that Uber is merely ‘carsharing’ (Chokkattu, Reference Chokkattu2014). This model is used for a variety of services, including holiday accommodation, and a range of technical services. In principle, many high skill, professional services are capable of being provided through internet platforms, which is why the development is so important and merits close scrutiny (Green & Barnes, Reference Green and Barnes2013).

Of course, many of these service providers, such as drivers, delivery workers, cleaners and caterers recruited through internet platforms are very different from the knowledge workers typical of IPro working. However, it is argued that not only can the ‘Uber/new power model’ be applied to the provision of a wide range of services, including quite sophisticated ones, but that there is anyway much similarity between the Uber issues and some that confront many IPros. Not least here is the suspicion or even hostility that many that ‘break the mould’ face, but also many practical and legal issues (Leighton, Reference Leighton2014).

A New Philosophy?

Supporters of new power, mainly expressing their views in social media, also argue that the emerging business models are not just new ways of working but represent a new work philosophy. In part, this is explained by people wanting more control, increased autonomy and choice (Genov, 2014; Mckeown, 2000) but also perhaps a reaction to so many Old Power businesses, especially multinationals, that have run foul of the law, public opinion or both. Examples are not hard to find, with some organisations exploiting their workforces, for example, by using child labour and constantly seeking manufacturers and service providers in low cost, less-regulated economies (ILO, 2016). Others have been accused of tax avoidance, unfair business practices, environmental abuses and corruption (included here are Google, Starbucks, Shell and British Aerospace).

To an extent, then, ‘new power’ may be a reaction against excesses, especially by multinationals. In fairness, the Old Power critique can be equally applied to many trade unions, charities, the public sector and even international governance (Richardson, Kakabdse, & Kakabadse, 2011). However, two questions now pose themselves, if new power is here to stay. First, how significant are these developments and what do they represent? In effect, how popular are these new power models and to what extent do their business practices mark a real change? Second, and most importantly, what challenges do they pose for existing institutions, regulation, social provisions and business and other practices? (Carbonaro, Reference Carr-Saunders and Wilson2016). The second question is, of course, the one to which most of this article is devoted.

How Significant are these Developments?

It is clear that in many ways, self-employment and autonomous forms of working that have been gathering momentum since around 2000 sit easily with new power (Mettler & Williams, Reference Mettler and Williams2011). Although there are some differences, both reject hierarchies, top down decision-making, and control and both seek openness, collaboration and ‘horizontal’ ways of working. Indeed, research suggests that although the idea of being be your own boss and creating your own work relationships has great attraction (Mckeown, 2009–20Reference McKeown15; EF, 2014), a sense of alienation from traditional (Old Power) organisation and being subject to what seems an increasingly rigorous Human Resource Management(HRM), is an important factor (Leighton, Syrett, Hecker, & Holland, Reference Leighton2007; Leighton, Reference Leighton2013, Reference Leighton and Mckeown2015; Leighton & Mckeown, Reference Leighton, Syrett, Hecker and Holland2015).

It is important to note that the rise of professional self-employment, along with collaborative and networked ways of working should not be seen as a mere extension of flexible working, which has also shown recent growth. There are more people now working at or from home, working part time or on, say, annualised hours contracts. Flexible working, which in essence is working other than as a full-time employee on a standard contract, simply represents work patterns which are a ‘derogation’ or a waiver provided by the employer to enable greater flexibility. This is often to accommodate caring or other demands but it is generally assumed by managers that once these needs have declined or ceased the employee will return to ‘normal’ working! In other words, flexible working can be seen as a concession from the normality of fulltime, workplace-based employment and we know that those who benefit from the ‘concession’ often make real sacrifices in terms of pay and careers (Lewis, Reference Lewis1997; Perlow & Kelly, Reference Perlow and Kelly2014). Indeed, it is possible that these sacrifices are one of the drivers of growth in independent/IPro working, whereby those who seek flexibility, choice and work-life balance see value in independence, rather than having to compromise, as they see it, their careers for retention of their apparent security and employee status.

The changes under consideration here are a far more radical development. Perhaps, the only parallel we can find are the changes brought about by the industrial revolution from the 18th century, whereby prior to industrialisation most people worked independently or collaborated through guilds or other structures After the industrial revolution, most became employees in increasingly large organisations. This situation then evolved into scientific management, such as Taylorism and other work forms that aimed to directly match employees to the employer’s business needs (Giddens, Reference Ghosh and Malloy1991). Many argue that this development has led to increased casual and other forms of intermittent work, such as zero hours contracts and agency working, developments which many have long viewed with concern (Marchington et al., Reference Marchington, Grimshaw, Rubery and Willmot2004). Others, including Bridge (Reference Bridge2010), in this volume, argue that the growth in independent though sometimes more unstable forms of work is a return the ‘typical’ work’, with employee status being the aberration rather than the norm.

But how real is this autonomy, sharing and collaboration? Is it just a passing phase or is something more profound occurring? Clearly, this is a difficult question and data remain limited. However, we know that the numbers employed by Uber worldwide are massive and growing, with other taxi firms using the same or similar business models arriving on the scene. We can easily access marketing and business information about some of the brand leaders in this way of working and can conclude that these are significant businesses that are capturing important markets (PWC, Reference Pofeld2016). We also know that many knowledge workers, especially in the growth areas of health care, education and business services access work in this way (Leighton, Reference Leighton2013).

Uber

We need to turn now to turn attention to Uber, the taxi facilitator that has caused most controversy but has probably had greatest impact. Uber was set up in the United States in 2009. It is thought that it operates in at least 64 countries (though it is banned in some), in 78 capital cities, employs at least 1.1 million drivers aiming for 42,000 drivers in London alone, and has been recently valued at over $50 billion (Chokkattu, Reference Chokkattu2014; Roy Morgan, 2016b). It operates out of the Netherlands and is covered by Dutch law. There are other taxi organisations using a similar business and internet-based model, such as Lyft and Kabbee and more recent rivals who are using similar technology-based business methods. As we shall see, the rise of this way of working has proved very controversial with a liturgy of court cases, industrial disputes, public disorder and complaints. Existing service providers’ livelihoods are often threatened, a factor leading to increasingly vitriolic outcomes (Hill, Reference Hill2015).

The way Uber works, as described above, appears easy to access, is allegedly cheaper than other taxi systems, and Uber drivers use newer and well-maintained cars. Uber reports that its drivers are screened by them, treated as self-employed (as ‘partners’) and are paid directly by Uber, usually some 8 days after money has been earned. Uber operates a customer satisfaction feedback system. If a rating is poor or there are specific complaints they can lead to deductions from pay by Uber or ‘discontinuation’ of the arrangement.

The rhetoric of sharing has proved powerful, with many arguing that Uber is simply a carsharing idea that works to the mutual benefit of car owner and passenger, and in the case of Airbnb, it is simply inviting someone to stay in your house when you have spare rooms. However, neither business is informal or charitable. Both are traditional companies using the business methods of a large multinational, with shareholders and a profit motive. Nonetheless, the romance of sharing has been a powerful magnet for both service providers and the users.

What about the actual service providers/drivers themselves? Despite the quite rigorous controls put in place by Uber especially in terms of seeking customer feedback, their drivers are treated as self-employed. In return for the benefits of accessing work through the internet platform, the drivers pay at least 25% of their earnings to Uber. Uber is not standing still and is increasing its market, developing new facilities such as carpooling and investing in driverless cars.

Providing a transport service is nothing new and Uber has many rival systems to compete with beyond those using internet platforms. These are the traditional tightly regulated ‘black’, ‘yellow’ and other cabs, along with in some countries registered ‘mini’ cab services which use different business models. As is considered more fully below, drivers of these types of taxis argue that competition from Uber is unfair as Uber drivers are not subjected to the regulations affecting many aspects of providing a traditional taxi service. Included here are training demands, specialist driving licenses, requirements for insurance and in many cases strict rules of conduct.

The extent to which Uber and other internet platforms facilitate genuine ‘sharing’ is a matter for debate. Adherents point to the rise of eBay and other ways of passing on goods and ‘house sharing’ via Airbnb as creating new notions of markets and economies. Cynics note the huge profits generated by these platforms and see ‘sharing’ as simply another capitalist device, coupled with advanced marketing (The Guardian, 2015; Hill, Reference Hill2015).

Collaborative working, but perhaps not so much ‘sharing’ is also, as has been referred to above, a feature of much IPro working. They have long used platforms such as LinkedIn and specialist platforms for particular professions. They make considerable and growing use of coworking spaces (Spreitzer, Bacavice, & Garrett, 205) and cooperatives. There is emerging evidence of innovative and collaborative working even amongst traditional regulated professions (compare the way professionals were working a few decades ago from Carr-Saunders & Wilson [Reference Campbell1933] and Abbott [1988] with data on the legal profession in Leighton [Reference Leighton2013] and SRA/LSB [2015]).

A particular issue which cynics are beginning to highlight is the earnings of so-called ‘gig’ or ‘crowd’ workers of varying sorts of which Uber is but one example. Huws and Joyce (Reference Huws and Joyce2016) undertook a survey of over 2,000 such UK workers, including, taxi drivers but also people working in occupations typical of IPro working. These include the creative industries, writing of various sorts, and health and other professional services who also found work through internet platforms such as Upwork and Handy. Interestingly, the authors of the research estimate over 5 million in the UK work this way (around 17% of the total labour market), with over half (54%) women, 57% doing professional work and over 60% creative work and 46% engaged in taxi work. Many in the sample had more than one role, and/or worked part time and the largest numbers came from English cities but only 10% were students. Some 43% had an annual income of below £20k, despite the fact that many were main earners; only 7% had earnings over £55k.

This research chimes with research which has been done on Uber drivers themselves (Pofeld, Reference Picciotto2016). This found that although there were some high levels of satisfaction with working for Uber, this was not marked where the driver was fulltime but was confined to those driving as a second job or working part time. In other words, drivers dependent on Uber for their main or sole income were the most likely to voice complaints.

Concerns about earnings which some internet platforms facilitate but which can also lead to a ‘race to the bottom’ for pay is but one of the issues that has led to disputes. It is these disputes that provide the cautionary tales for IPros and the self-employed more generally.

Uber: Controversies, Disputes and Litigation

Such is the profile of Uber that an increasing number of business commentators, rather than academic writers have begun to catalogue the disputes (e.g., EF, 2016; Roy Morgan, Reference Richardson, Kakabdse and Kakabadse2016a). There are few countries in which Uber operates that have not experienced disputes.

There tend to be three major themes which characterise these disputes. First and probably most importantly, there is the fundamental question of ‘What, precisely, is Uber’? Things have come to head in the EU with the referral by a Spanish Court to the European Court of Justice (ECJ)Footnote ¹ of the question of whether Uber is simply an internet services provider or a public transport company? If the former, law has only limited ability to control its activities; if the latter, there are many laws both from the EU itself as well as national and local government that can be applied to Uber. However, disputes and litigation are by no means confined to Europe. Indeed, there are few jurisdictions where litigation has not featured.

The definitional conundrums generated by Uber are clearly also an issue for IPro working? The question can be simply posed. What is an IPro? An entrepreneur? A ‘nano business’? A contractor? A specialist with labour markets? ‘Not an employee’? This matter will be returned to.

The second theme combines regulation with the private law of contracts and it concerns the legal position of Uber drivers. What is their legal relationship with Uber? Are they genuinely self-employed or, in part hiding behind the rhetoric of sharing? Are they, in legal reality, employees of Uber and therefore in so-called ‘sham’ relationships (Muehlberger, Reference Muehlberger2007). Employment status is a global issue with courts struggling in most jurisdictions to differentiate the genuine self-employed from the employee. For example, we have recent case law from Australia that has summed up the issues effectively for the ‘sharing economy’ (de Flamingh and Cameron, 2015).

This issue also has relevance for access to social protections, taxation and even the application of areas of law, such as competition lawFootnote ² . It is also an area which has been and continues to be a running sore for supporters of IPro working with fiscal authorities in many jurisdictions constantly seeking ways to assert that many IPros are, in reality, employees and tax dodgers (e.g., from the United Kingdom, Office of Tax Simplification, 2014, 2015 and the NetherlandsFootnote ³ ).

The third area, and one that is less debated, concerns public safety and security and especially the role of regulation. The calls for deregulation, open competition and lifting burdens on business have gone virtually unchallenged in recent years in developed economies. We have therefore deregulated and have very little new regulation. The incidents and litigation concerning Uber has highlighted some of the risks that such policies can lead to. These include injuries in road accidents, assaults and threats, the lack of insurance and indemnity provisions, poor driving and navigation standards and general questions of ‘What happens when it all goes wrong’?

Again, although the controversial issues of IPro working tend to be less dramatic, there can be concerns that an unregulated or lightly regulated provision of professional services can lead to lower standards and the possible decline of notions of ‘professionalism’ itself.

Theme 1: What Exactly is Uber?

To answer this at least for EU purposes, will have to await the decision of the ECJ on the Spanish case referred to above but it is key issue in many other jurisdictions. The ECJ decision is unlikely to be made before the end of 2016. In the meantime, a series of cases across EU member states have been dealing with the defining and categorising of Uber (EF, 2016). In litigation, Uber has often styled itself as a ‘connecting service based on electronic mediation between people who want to share cars’. Although in a few cases this argument has prevailed, mostly it has not, with decisions in, say, Finland, Sweden and Italy deciding that Uber was a taxi service and subject to relevant rules. In Hungary, a 2015 DecreeFootnote ⁴ restated the rules covering taxi services, now including ‘car passenger services’ taken to cover Uber. The Decree was challenged by Uber and has led to complaints by other taxi drivers that it has not been enforced. It seems little will be resolved until the ECJ lays down its decision.

Meanwhile, disputes rage outside the EU. They include disputes in the United States (Forbes, 2015; FT, 2016); India (Times of India, 2014); Kenya (Citizen Business, 2016) and Australia.

In trying to define and locate Uber for a range of legal and other reasons, there may be another way to look at Uber. This is as an intermediary in a context where intermediation, typically by employment agencies, is both defined and regulated in many jurisdictions (agency working is especially well developed in the United States, Japan, the United Kingdom and several Western EU states). The main intention of regulation has been protection of the ‘temps’ and prevention of exploitation (Busby & Christie, Reference Busby and Christie2005), rather than of defining agencies, though there are exceptionsFootnote ⁵ . At EU level we have the 2008 Temporary Agency Work Directive and although it is primarily also concerned with worker rights, it does contain some helpful definitions that could be applied to Uber. However, although this area of regulation could have relevance to Uber, we still have some major problems. First, the intermediary is an internet platform and hard to regulate, though it might be argued that the people who work in the many administrative offices of Uber could be seen as the ‘real’ intermediaries, as they make the key decisions affecting the work of individual drivers? But second, intermediation sets up so-called ‘triangular’ relationships whereby although there is a legal relationship between the intermediary (Uber) and the individual (driver), there is generally in most legal jurisdictions no legal relationship between the client – here the passenger – and driver.

Questions of definition and categorisation are also key issues for IPros. As referred to above, the fundamental question is whether they are part of the business community, in effect being nano-businesses/solopreneurs and the like? If they are not, is it appropriate that they are regulated by business provisions? Or, are they simply a specialist part of the labour market, being the highly skilled self-employed? In which case, are they appropriately covered by labour/employment law (Leighton, Reference Leighton2011). Definitional issues around IPro working are typically generated by fiscal authorities, arguing that self-employed status is a ‘sham’ or by the apparent self-employed themselves seeking employment protective rights. Cases might arise out of areas of law such as equality, health and safety and human rights.

These are major questions that merit more exploration and debate (Kitching & Smallbone, Reference Kitching and Smallbone2012; Stone & Arthurs, Reference Spreitzer, Bacavice and Garrett2013; Coopman, Reference Cooper, Mitchell and ThiererMitchell, & Thierer, Reference Cooper, Mitchell and Thierer2014).

Theme 2: Work Relationships

The regulation of the workplace is self-evidently geared to traditional employment, largely based on employee status and until recently, full-time employment. The key players have been employers and in most developed economies, trade unions, such that employment terms and conditions of work have been generally arranged through collective bargaining and agreements, leaving a relatively minor role for the state and national legislation. So strongly embedded have been these features (though weaker in common law jurisdictions such as the United States and United Kingdom), that even the growth in part-time working and other forms of flexible work, such as job sharing and homeworking have often faced resistance. The rise of employment agencies and other forms of intermediation have also provoked hostility, with agencies being illegal in some states until recently (Heery et al., 2004; Busby & Christie, Reference Busby and Christie2005; Heery, Reference Heery2005).

Change has not been easy and the self-employed have often been at the forefront of controversy and challenge. In terms of Uber, the key question has been what, exactly, is the legal relationship between Uber drivers and Uber? The fact that services are provided on an attractive, innovative and allegedly shared basis does not alter this underlying need to analyse the relationship, not least because the implications of a particular employment status go beyond the workplace. They touch on matters of accessing loans and mortgages, social protections and provision for retirement, as well as issues directly related to employment.

An important issue and one already touched on is the question of ‘sham’/‘disguised’/‘false’/or even ‘fraudulent employment contracts’ (Casale, Reference Casale2012), which, as mentioned above has also been such an issue for many IPros. The argument is that is that describing Uber drivers as ‘partners’ is merely a device to disguise their ‘true’ employee status.

This is a long running, unresolved issue in most jurisdictions (Leighton & Wynn, Reference Leighton and Wynn2011; European Forum for Independent Professionals [EFIP], 2015), where different tests are applied in different states, at different times and with differing consequences when trying to differentiate the genuine self-employed from employees. Attempts have been made to explore various aspects of the employment relationship as providing the essential key to its nature. For example, Is the individual in question sufficiently ‘subordinate’ to the employer? Are they integrated into the employer/client business? Do they lack the features that a genuine entrepreneur would have, such as providing their own facilities and equipment, having a range of clients and, today, having a website, being Value Added Tax (VAT) registered and using an accountant? This might suggest employee status.

Unsurprisingly, the advent of the digital platform and assertions that we are moving into an entirely new era of the world of working have inevitably made these tasks more difficult, compounded by the fact in Uber’s case that the contractual documents they use are designed to inhibit legal challenges, though they cannot prevent it.

The global Uber case law is of interest because the notion of sharing appears to have little impact or relevance when tests of employment status are being applied. The key questions have tended to concern the control which Uber exercises, or does not, over the drivers. Those who argue they are properly employees point to the apparently strict selection and screening rules before they can join. There is, then, the feedback process from passengers, other rules of conduct, the supply of the smart phones to drivers, incentive payments based on productivity and, importantly, assurances given to drivers of intervention by Uber if drivers face problems. Hopefully, the myriad of cases before courts in this question will clarify the nature of the employment relationship between Uber and its drivers, though one fears that confusions and anomalies will likely continue.

However, the relational and definitional issues go wider and are critical for policy and law-making. Are people providing services, especially perhaps the homeowners in Airbnb, also nano-businesses? (and is there a business relationship between the owners and ‘house guests’?). Could the Uber drivers, who in theory are free to ‘partner’ with other organisations also be nano-businesses? Do the elements of choice, opportunity, sharing and collaboration add a dimension on how we define people at work? In a borderless, digital world, are they more likely to be seen as self-employed?

We simply do not know, as cases, at least those concerning Uber drivers, have varied from state to state in the United States, as between EU states and in Australia. All we are learning is that the Uber cases have highlighted what has been a running sore of labour markets across the world. This is the failure to clearly differentiate the two groups, or, and this is hugely important, reconsider why we have the two groups at all and whether an inclusive or different system could be put in place. It is thought that the EU at least is aiming to do this, but it is likely to be a very difficult task (EFIP, 2015).

There are other legal reasons why locating both Uber drivers and many IPros into the ‘right’ category is important. These are to do with commercial considerations. These hinge on the distinction between commercial relationships which are covered by specialist jurisprudence, such as competition law and corporate law, and genuine employment relationships covered by employment/labour law (Drexl & Di Porto, Reference Dellot2015). The application of one area of commercial law-competition law, within the EU has provided some interesting insights into the question of categorising work relationships. Commercial organisations are covered by the increasingly important competition law; employees are not.

Early competition case law suggested that if a person was under the ‘direction’ of another they were not a commercial entity and outside the law, for example, for the purposes of analysing the effects of collective agreements and restrictive labour practice. In a recent case, involving freelance substitute orchestra musicians it was for the ECJ to determine whether the fixing of fees for the work was anticompetitive. It was held by the ECJ that if the musicians were ‘falsely’ self-employed (i.e., really employees) they were outside the scope of competition law but if genuinely self-employed they were covered. The court rejected the Advocate General’s advice that a wider approach be taken and recognise the often subtle pressures on individuals to comply with the ‘norm’ – whatever it might be. Here, the label of self-employment was held to be accurate, so competition laws could applyFootnote ⁶ . This often neglected case law is a rich source of insights into this notoriously difficult area of employment relationships, and also has important implications for both Uber and competitive market places, but also for many IPros, especially perhaps those using limited companies.

Theme 3:The Role of Regulation

This is the crucial issue. As touched on earlier, in recent years it has become fashionable to describe regulation as ‘red tape’ and to see it as inhibiting innovation, development and competitiveness. ‘Deregulation’ has become a clarion call not just in the common law world but within the EU and wider. Particular concerns have been voiced on the need to ensure small businesses are not overburdened and unable to thrive (Ghosh & Malloy, Reference Giddens2011). Hence, there have been measures in many states to ensure the setting up a business, accessing finance, dealing with bureaucracies and fiscal bodies is simplified. And yet there has been very little debate or research on the effects of regulation itself (Campbell, Reference Carbonaro2010).

Many of the reports, disputes and litigation regarding Uber’s business practices concern whether and to what extent they are or should be regulated. We have reports of fatalities caused by the driving of Uber drivers, perhaps the most widely reported was that of Syed Muzaffer who killed a 6-year-old child in the United States. He was allegedly not concentrating on driving as he was checking his phone. A claim made against Uber, on the basis of its vicarious liability was rejected but subsequently quietly settled out of court, though Uber continued to deny responsibility (ABC News, 2014). There have been also alleged sexual and other attacks on passengers, racist and homophobic behaviour, refusals to give lifts to disabled people, all of which can lead to a ban on providing a taxi service where the service is regulated. The role of the law of contract is also a key regulatory issue. Uber’s contracts are governed by Dutch law and require arbitration before litigation, both, it appears requiring litigants to go to the Netherlands! This is an effective deterrent. With global reach, use of internet platforms and with organisations able to choose the ‘best’ legal jurisdiction for their purposes, the issue of the effective enforcement of regulatory provisions needs urgent attention.

There are then linked matters of insurance, training and supervision again, typically required by regulated taxi businesses. It is argued that the greater the complexity and uncertainty about new ways of providing services, the greater the need to consider this basic issue. Although, the issues around Uber have been highlighted where the people involved are less skilled and qualified than the knowledge workers typical of IPro working, these issues and examples do seem, potentially, to have great relevance for IPros.

There are, of course, many wider concerns about the medium to longer term effect of new business and work models which are beyond the scope of this article. Mostly, these focus on labour markets, employment relations (Dygryse, Reference Drexl and Di Porto2016) and social protections (Pofeld, Reference Picciotto2016). At present, policy and law-makers are adopting a generally cautious approach to these concerns and seeking further research data. However, there can be no doubt that, increasingly, the issues are seen as serious and meriting attention.

Summary

What can we learn of relevance from Uber, especially in terms of other independent and new forms of work? Analysis is undertaken from two perspectives.

First, a 360° look at Uber, focussing on the main ‘stakeholders’. These are as follows:

• ∙ Uber passengers;

• ∙ Uber drivers;

• ∙ Non-Uber drivers;

• ∙ Uber itself.

This is not to overlook other and important stakeholders – such as members of the public who might also be affected by Uber activities.

1. 1. Uber passengers

They are the direct clients of the Uber experience. Let us sum up the problem areas and ambiguities.

• ∙ There is no contract between the passenger and the driver. Passengers contract with Uber. If there are problems and disagreements, as Uber treats the drivers as self-employed they will deny vicarious liability for a driver who causes harm.

• ∙ There is no obvious means of redress for passengers if things go wrong (some have been attacked, abused and robbed), as there is not usually a regulatory body that is responsible for standards. Only Uber can take action against drivers.

• ∙ Passengers anyway have problems in enforcing claims through local or accessible courts.

• ∙ The rhetoric of sharing has meant that, in most jurisdictions, drivers are not required by Uber to have a special driving license, special insurance, etc. or undertake appropriate training. Nonetheless, they are subject to a strict set of rules which enables Uber to terminate an arrangement they have with a driver, though it is thought that the motivation for this is to protect Uber’s reputation rather than public safety, etc.

• ∙ The issue of training and skills has proved very contentious and resonates closely with aspects of IPro working. Some argue that the lack of training means that drivers sometimes get lost, take longer routes than necessary and cannot deal with emergencies.

1. 2. Uber drivers

• ∙ Interviews with them suggest they have mixed responses to their work, though the most satisfied are those working part time or as a second job. This gives them extra cash but also flexibility (Pofeld, Reference Picciotto2016). My own interviews tend to confirm this.

• ∙ They are at personal risk if they have an accident or otherwise cause harm (for which they are individually responsible), or themselves suffer loss. Insurance costs are extremely high.

• ∙ The major regulatory issue is that of employment status, with Uber declaring them to be self-employed, but courts sometimes finding them to be, in reality, employees of Uber.

• ∙ This lack of protection, according to some commentators (European Parliament Magazine, 2015) makes them especially vulnerable. Many argue that Uber creates what he calls ‘dead end jobs’ which lead to a ‘servitude bubble’. So, what can start off as ambitious, contemporary and value-driven developments, might well, even in the medium term have major downsides.

1. 3. Non-Uber drivers

They have been vocal in their opposition to Uber in many states. They have literally taken to the streets, launched legal claims, lobbied strongly and have generally argued for curbs on Uber. The issues that affect them are as follows:

• ∙ They consider that they are subject to unfair competition, not least through the costs of their complying with regulations, training costs, etc.

• ∙ Challenging the current situation has proved difficult, with state bodies, declaring themselves to be antiprotectionist, often rejecting their claims in the interests of increased competition, so as to improve choice, reduce costs and encourage innovation.

• ∙ They also fear reduced incomes not least because Uber is increasing its driver numbers dramatically, putting more strain on incomes. To become a Black Cab driver in London, for example, takes up to 4 years preparing for a test called The Knowledge relating to London roads, facilities and requires drivers to be aware of roadworks, congestion, etc. and to know the ‘best’ routes. As well as the costs associated with this, the taxis themselves cost upwards of £40k, and the drivers are part of a specialist regulatory system that sets fares, requires response to the first person wanting a cab and applies strict rules to conduct and driving.

1. 4. Uber

Uber, along with other internet-based service providers, has clearly developed and is evolving a brilliant idea. It makes service provision easy and direct and their service provision is underpinned by major investment in technology. However

• ∙ Despite the technological innovation and specialist business model Uber itself is rather old fashioned. It is a traditional, hierarchical company, dependent on shareholder approval and priorities.

• ∙ Uber is facing one core challenge. This how, if at all, it is to be regulated? The case before the ECJ for the EU will be decided within the year. If it is found to be a public transport provider, rather than ‘just’ an internet platform the consequences for Uber (and many other new business models) will be major. Transport law is well developed and in the EU there is a strong set of protections for passengers. The costs could be high.

• ∙ If more and more courts determine that their drivers are employees, their costs and liabilities will increase considerably.

• ∙ If an argument is successfully mounted, especially within the EU that Uber is, in legal reality, an intermediary, much as Manpower, Adecco and Ranstadt are, in that they supply workers to clients/passengers, Uber may well be subject to increased control and face the need to provide more protections for their drivers. Again, costs would inevitably rise.

The Last Word Has To Be ‘Regulation’: Maybe We Have To Roll Back The ‘Deregulation Mantra’?

It is not hard to see some of the implications for IPros from the experience of Uber. The parallels are not precise but there some major areas of commonality. The self-employed regardless of skill level or work sector have been marginal in most developed economies until recently. Mostly, they got on with their work, be it as an accountant, farmer or shop keeper, usually delivering their services directly to clients or customers and usually in a limited geographical area. The internet, new ways of working, working across national borders has, of course, made dramatic changes. However, our regulatory framework has little changed and many of the ‘old’ issues, such as ambiguous employment status and many fiscal issues remain the same. The imperative of defining Uber itself is proving very difficult, not least because of the reluctance of many policy and law-makers to regulate and control businesses.

It is suggested that an urgent review be undertaken about regulation itself and its application to new forms of service delivery. For example, does regulation really add to costs? Do people comply with it? How important are enforcement mechanisms? Is there some type of regulation that people are more inclined to accept than others? Why? What is ‘good’ regulation and should not Impact Assessments go beyond simply looking at cost (Picciotto, Reference Stone and Arthurs2002).

Following this, an attempt should be made to find the appropriate regulatory framework not just for Uber but importantly for IPros and other self-employed people. The Uber story is an important one, not least in focussing our minds on some core issues around responding to change, avoiding disputes through a sensible, balanced and clear regulatory framework so as to facilitate effective businesses and employment practices.