A year has passed by in a flash since the implementation of the first MCO (Movement Control Order) due to the Covid-19 outbreak. Investopedia describes the ‘gig economy’ as a system that provides flexible, temporary and freelance jobs, in contrast to the traditional economy that consists of full-time or permanently-hired workers. To recall how the Covid-19 pandemic has accelerated the Malaysian gig economy, many were seen to have resorted to digital ventures to sustain a living particularly during MCO as most business operations were forced to halt, thus leaving them with no jobs.
Currently, 26% of the 15.3 million Malaysian labour force make up the gig economy with the workforce witnessing a growth of 31% as of 2017 (Department of Statistics Malaysia, 2020). These figures are expected to rise in the near future especially in Southeast Asia, following the growth in e-commerce and digitalization. Furthermore, the change in consumer demands apart from the need to adhere to standard operating procedures (SOP) to limit one’s movement is also among the important factors that contribute to more ‘giggers’ joining the industry especially in the p-Hailing services involving delivery of food and parcels.
The situation definitely calls for a strong urge to implement an effective provision of social safety nets and approaches to tackle various issues pertaining to worker classification and wage parity to foster equity and resilience in the ever-growing gig economy. As much as these jobs possess benefits in terms of work flexibility, there are challenges and consequences that demand our serious attention. Therefore, this article will highlight major concerns surrounding gig workers and essentially, outline the next course of action to be reckoned with to ameliorate a better ecosystem for these gig workers.
Firstly, it is crucial to address the issue pertaining to a gig worker’s classification and their status, whether or not they are protected by the law from abuse and exploitation. Unlike ordinary, traditional employees in the formal sector, gig workers do not have the right to form unions and negotiate contracts. As of July 2020, the government had been in talks to establish legislation that specifically regulate these gig workers, and since then studies on various options regarding work and social security were conducted (Malay Mail, 2020). However, as “Prohibition of parliamentary sittings” is entailed as per the State of Emergency, effective from Jan 11, 2021 until Aug 1, 2021, there has been no progress made in passing the bill for gig economy.
At present, they are only protected under the Self-Employment Social Security Act 2017 (Act 789) without specific labour provisions i.e minimum wage, working hours limitations, paid annual, sick leave and unfair dismissal. A recent gig economy report by PwC Legal encompassing the employment status of workers in different European Commission (EU) countries probes into legal schemes and classification of gig workers. It concluded that a “legal framework is essential in order to seize the opportunities the gig economy has to offer”(PwC Legal, 2021).
Although the government has pledged to support gig economy and gig worker’s welfare through the PEMERKASA package recruitment incentives of an allocation worth RM300 million for 60,000 gig workers (Daily Express, 2021), the question is would this be sufficient to cushion impacts from the pandemic in times of uncertainties given the scant recognition of gig workers by the law? As the gig economy is predicted to grow in line with the services sector, it is time for the government to make efforts by recognizing them under the Employment Act.
Secondly, as gig workers in the p-Hailing services consist of food and parcel delivery riders, let us bring to mind that they are susceptible to traffic and road accidents. In a recent infographic provided by MIROS (Malaysian Institute of Road Safety Research), within a span of nine months of the last MCO, a total of 91 accidents involving p-Hailing riders were recorded (The Star, 2021) and based on a survey conducted by MIROS, 70% of p-Hailing riders were found to have dangerously rode on peak hours (Malaysian Institute of Road Safety Research, 2021).
Hence, what can be done to ensure the safety of these riders? There is no recipe other than enticing companies to take on the measures for road traffic safety management. Local experts recommended that companies involved should consider appraising the ISO39001 and IS039002 international standards, a guideline that could minimize the probability of road-related injuries and deaths for their workers (Kaur, 2021). Other courses of action may include devising an approach for employers to monitor the riders’ speed whilst on the road.
When it comes to addressing the pressing matters concerning job security and safety of these workers, bringing forth adequate social safety nets and protection should remain a top priority. To raise the number of gig workers contributing to the Social Security Organization (SOCSO), Grab Malaysia has been engaging with SOCSO on how the system could be tailored to meet the gig workers’ needs. Likewise, SOCSO contribution by Foodpanda has commenced beginning April 2020 under the Self-Employment Social Security Scheme.
The latest findings from engagement programs conducted by the National Employment Special Committee initially aimed at boosting employment shows that the number of gig workers from various platforms protected under SOCSO increased from 81,000 in 2020 to 142,000 this year (The Malaysian Reserve, 2021). In a recent statement by SOCSO dated 16 July, more than 145,000 gig workers are now protected as service providers namely Grab Malaysia and Foodpanda have begun to enrol their delivery partners in the Employment Injury Scheme under SOCSO (Ram, 2021). Also, the government is said to provide full funding assistance under Plan Two of the Self Employment Social Security Scheme (SKSPS) amounting to RM232.80 for a coverage period of one year, where benefits include and not limited to medical, temporary & permanent disablement, dependants & funeral, constant care allowance, education and rehabilitation benefits.
At present, the number of giggers contributing to SOCSO is still relatively low, at 6.1% compared to the 2.72 million gig workers as recorded by the Department of Statistics Malaysia, hence, through SKSPS that aims at encouraging more delivery providers to enrol for the scheme (Social Security Organization, 2021), we hope to see a consistent spike in the number of gig workers enrolled and protected under SOCSO. Simultaneously, besides forming symbiotic collaborations between agencies and sectors to spur the creation of an effective mechanism that facilitates gig workers’ contribution to both SOCSO and Employees Provident Fund (EPF) savings, the solution must also emphasize on getting employers to provide supplemental coverage for their workers in the long-run.
Lastly, the role of the government in safeguarding the interest of gig workers is pivotal, however, on the question of whether the private sector and the parties that drive the gig economy are partly responsible, the answer is a yes. For instance, since the beginning of 2020, there have been efforts by the Ministry of Manpower, Singapore in collaborating with tripartite partners and agencies of various sectors to provide gig workers with access to technical and skills training. Such schemes are tailored for gig workers to undergo training within their fields of freelance work (Agarwal, 2021).
Meanwhile, in our country, at this point of time, such upskilling and training programs are also offered albeit still in its earliest stage and the responsibility is on companies and agencies, with limited intervention by the government. For example, under the Skill Enhancement Plan, Foodpanda has been offering classes for their partners who intend to acquire skills which include coding, data science and language (David, 2020). Other delivery platforms may adopt similar training schemes as they are proven vital for gig workers to gain useful know-hows customer service skills.
In conclusion, the effects of the pandemic have put Malaysian gig workers in a perilous setting. It certainly has highlighted the flaws of the existing social protection system besides giving us a clear hint on what we should be working on next. Perhaps, through anticipating and nurturing more cross-sectoral collaborations, the government could join hands with gig platform companies and agencies to establish alternative social protection coverage to make up for the inadequacy and other viable initiatives that are sustainable and beneficial for these giggers. Most importantly, greater caution is therefore necessary in designing policies or laws to shield the rights of these gig workers for them to attain maximum benefits throughout their career.
Agarwal, S. (2021, March 9). Commentary: The gig economy – a surprise boost from the pandemic and in Singapore, it’s not going anywhere. Channel News Asia. https://www.channelnewsasia.com/news/commentary/gig-economy-performance-covid-19-jobs-revenue-grab-gojek-14288764
Daily Express. (2021, March 17). ‘Pemerkasa’ stimulus package worth RM20b launched. Daily Express. https://www.dailyexpress.com.my/news/168069/pemerkasa-stimulus-package-worth-rm20b-launched/
David, A. (2020, August 12). Foodpanda says riders’ benefits include insurance and Socso. New Straits Times. https://www.nst.com.my/news/nation/2020/08/616011/foodpanda-says-riders-benefits-include-insurance-and-socso
Department of Statistics Malaysia. (2020). Gig Workers in Malaysia: A Review of Definitions and Estimation (Issue 8). DOSM MBLS. https://dosm.gov.my/v1/uploads/files/6_Newsletter/Newsletter%202020/DOSM_MBLS_1-2020_Series-8.pdf
Kaur, M. (2021, January 30). Delivery companies bear responsibility for reckless riders, says expert. Free Malaysia Today. https://www.freemalaysiatoday.com/category/nation/2021/01/30/delivery-companies-bear-responsibility-for-reckless-riders-says-expert/
Malay Mail. (2020, July 29). Govt to introduce new legislation to regulate gig workers, Dewan Rakyat told. Malay Mail. https://www.malaymail.com/news/malaysia/2020/07/29/govt-to-introduce-new-legislation-to-regulate-gig-workers-dewan-rakyat-told/1889319
Malaysian Institute of Road Safety Research. (2021). Penunggang P-Hailing di Malaysia. https://twitter.com/mirosroadsafety/status/1383727326811226121?s=20
The Malaysian Reserve. (2021, May 8). 150,597 job seekers found employment as at last month, exceeding projection – PM Muhyiddin. The Malaysian Reserve. https://themalaysianreserve.com/2021/05/08/150597-job-seekers-found-employment-as-at-last-month-exceeding-projection-pm-muhyiddin/
PwC Legal. (2021, January 27). Gig economy report: Employment status. Eurofound. https://www.eurofound.europa.eu/data/platform-economy/records/gig-economy-report-employment-status
Ram, S. (2021, July 18). Grab And Foodpanda Riders Are Now Covered By SOCSO. SAYS. https://says.com/my/news/grab-and-foodpanda-riders-are-now-covered-by-socso
Social Security Organization. (2021, July 16). Lebih 145,000 Rakan Penghantar Grab Malaysia dan Foodpanda Kini Dilindungi PERKESO. SOCSO Media Statement. https://www.perkeso.gov.my/images/kenyataan_media/2021/160721_-_LEBIH_145000_RAKAN_PENGHANTAR_GRAB_MALAYSIA_DAN_FOODPANDA_KINI_DILINDUNGI_PERKESO_1.pdf
The Star. (2021, July 2). Miros: 70% of p-hailing riders disobey traffic rules while on delivery runs. The Star. https://www.thestar.com.my/news/nation/2021/07/02/miros-70-of-p-hailing-riders-disobey-traffic-rules-while-on-delivery-runs