A pick-up stop for Ola Shuttle in Gurgaon, Haryana. (Abhinav Saha/ Hindustan Times via GettyImages)
Snapshot
  • In the evolving space of employers, employees and companies, the customer is now both consumer and producer. The logic of keeping separate entities is questionable.

In the last week of October, Ola and Uber drivers in Mumbai went on “strike” to demand higher fares and assured minimum guaranteed incomes, among other things. As cabs stayed off the roads, fares “surged” three or four-fold on several routes, as fewer drivers were willing to put their cabs into service.

The funny thing is the use of the word “strike” when Ola and Uber drivers are not “employees” of these app-based taxi-hailing services. A strike can be called by workers who are hired by a company to do a specific job and there is an employer-employee relationship between the two. But this is manifestly not the case here. While groups of drivers can obviously resort to collective action to demand – and sometimes obtain – better terms of engagement, the larger question to ponder over is the changing nature of relationships in the workplace, the definition of the workplace, and the nature of “jobs” and employment in the new gig economy where more people than ever before are earning livelihoods without having a steady job.

This is changing because another crucial relationship has changed: the one between customers and companies. When you buy something on Flipkart or Amazon, you are not buying products they created or manufactured; they are mere “marketplaces”. So, the responsibility for selling a bad product remains with the actual company that sold it, not the marketplace that facilitated its sale. The middle function, which connects an employer to the employee, or a manufacturer to his customers, has been disintermediated by technology platforms which take only limited responsibility for what happens through their platforms.

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An Uber driver molested you? Blame the driver and not Uber, for he is not employed by the company. At best, the company may help you file a complaint or cut him loose from the app. It won’t take total responsibility for the behaviour of its driver unlike, say, a bank employee who cheated you.

Another change is that you actually have a dual relationship with the platform – as both customer and producer of services (or goods). An Ola driver is the company’s customer (the company must service him if he is to offer cab services to riders), but he is also the producer or supplier of services on the platform. A company selling fashion goods on Myntra is a customer of the platform, and also a producer of goods for customers who buy from the marketplace. Even when you use Amazon, many of you may be “prosumers” – both producers and consumers. As a buyer of a book, you are obviously a customer, but as someone who may post a review or offer you old books for sale on the platform, you are also a supplier of goods and services.

Clearly, technology and innovation lie at the root of these changes to workplace and consumer relationships. When technology can disrupt and destroy existing corporations, no company will want to employ anyone for an extended period of time, and no employee can afford to believe in corporate loyalties when the reverse isn’t true anymore. In the 1950s, the average lifespan of an S&P 500 company in the US was nearly 60 years. Today, it is less than 20.

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GE, once the powerhouse of the industrial and post-industrial market economy, is now a pale shadow of its former shelf. It has been ejected from the Dow Jones index and has lost $500 billion in market value from its peak in 2000. Even technology platforms and services that once ruled the roost can die an unsung death: remember Netscape, Orkut, AltaVista? Will BlackBerry and Nokia remain in service a few years down the line?

Perhaps the only employer who today fits the definition completely is the government, but in many places – bankrupt countries like Greece, and some bankrupt states and cities in America – even working for government is no guarantee of job security. Bankruptcy afflicts not only companies but states, too.

Governments that print their own money can at least provide reasonable job security, but no corporation, howsoever strong it may be today, can expect longevity as its birthright. This fact is impacting both company-customer and employee-employer relationships. These relationships no longer have the permanence they had before, and have become purely transactional in nature. They are good only for today. Can I be sure that Walmart or Amazon will be there in 2030? Not at all. A major crisis of confidence among investors in these companies can give short shrift to their longevities. How many banks, even those that existed 10 years ago, exist today in India? How many will remain tomorrow if today’s customers shift loyalties? If people use app-based taxi services and stop owning cars, Maruti’s new customers will be Ola drivers, not you and me.

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We are entering a brave new world where old definitions of worker, customer, company, employer and producer no longer hold true, but the world of law and rules is stuck in industrial age realities. If we want to get our arms around the problem, we need more flexible governance systems, more agile law-making and quicker responses to new challenges and opportunities. If an Ola can provide lots of new livelihoods (and not necessarily jobs), we need to ensure that regulation is light and sensible – light enough to make these business models work, but not so light that they end up riling “dependent contractors” like drivers where they end up hurting “customers” through misbehaviour or “strikes”. Companies can outsource work or jobs to cheaper service providers, but they cannot disown either their responsibilities to serve customers or their suppliers. In other words, both Ola and Uber have to grow up, and take more responsibility, and if this means customers have to pay more in order to receive better services, so be it.

At the end of the day, even a customer cannot be mollycoddled with super-low rates where the providers of these services (Uber or its drivers) are driven to desperation. The customer is no longer queen, for at the end of the day, in the new workplace, she is also the indirect employer of the Ola driver. She is both consumer and producer. The old logic of keeping employers, employees, customers and companies as separate entities is questionable. We are all things at the same time. The new workplace of self-employment in a gig economy, the new marketplace for goods and services mediated by technology rather than humans, demands new thinking.

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