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Making Sense of
Gig Work

LMI Insight Report no. 45
September 2021

Illustration by Jesseca Buizon for LMIC.

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Key Findings

  • The rise of the on-demand digital workforce, facilitated by technological advancements, has brought increased attention to the phenomena of “gig work.” It has also raised concerns about, among other things, workers’ rights and labour market stability.
  • A review of the prevailing research in this area reveals inconsistencies in how gig work is defined, making it difficult to understand what it is, how to measure it and how to determine its impact on workers and society. Moreover, gig work is often conflated with other terms, such as “precarious work” or contract work. Such confusion is apt to result in ineffective or adverse policy responses.
  • Although the meaning of gig work can be complex, and has most certainly evolved over time, we identify three common approaches used to describe it:
    1. Online interfaces (i.e., work mediated via digital platforms)
    2. The legal-contractual component (i.e., the formal relationship between the payor and payee)
    3. Work characteristics (i.e., specific features of the job, such as scheduling, remuneration and job tasks)
  • The three common approaches used to describe gig work are not mutually exclusive. They sometimes overlap, creating further challenges to understanding gig work.
  • As research, policy and law related to gig work evolve in Canada and globally, it is essential that all stakeholders have the same information and are clear as to what constitutes gig work and the problems, if any, that policy makers are trying to address with respect to gig work.
  • Statistics Canada is currently working to develop a coherent framework for defining and collecting information on gig employment that is consistent with the International Classification of Status in Employment. This will go far toward helping us better understand gig work.

Table of Contents

Introduction

Over the past decade, the term “gig work” has become widely used to describe emerging forms of independent work. Inconsistencies in how the term has been used, however, have bred confusion over what exactly constitutes gig work.

In the broadest sense, it refers to work performed by people paid on a project-by-project basis (i.e. paid per “gig”). It is thus equivalent to work performed by independent contractors.

More narrowly, the term has been applied only to work conducted through online interfaces such as Uber, DoorDash, Amazon Mechanical Turk and Gigster.

Across all definitions of gig work, there is an association with the notion of precarity (see Box 1), so much so that the two terms are frequently conflated.

The lack of an officially accepted definition[1] has given researchers and others a lot of independence in how they define gig work, which ultimately impacts how it is measured and how (and whether) it should be addressed.

In this LMI Insight Report, we investigate how this topic has been treated in various publications to bring greater clarity to the subject of gig work and build a framework for understanding past and future discussions.

We find that gig work is often defined, either singularly or in combination, based on three common approaches:

  1. online/digital interfaces (i.e., work mediated via digital platforms);
  2. the legal-contractual component (i.e., the formal relationship between the payor and payee); and
  3. work characteristics (i.e., specific features of the job, such as scheduling, remuneration and job tasks).

[1] In March 2021, the Labour program — a part of Employment and Social Development Canada (ESDC) responsible for protecting the rights of workers and employers — defined “gig work” in a background document published for consultations to better understand gig work in Canada. This definition, however, is not official nor does it represent ESDC’s position on gig employment.

Box 1: “Risky” Business

Precarious work, or precarity, generally refers to work where the employee, rather than the employer, bears the risks of the job.

Though there is no official Canadian definition, the International Labour Organization defines precariousness as “risky” job attributes such as low pay (i.e., earnings at or below the poverty line), uncertain continuity of employment, little or no choice about working conditions (e.g., schedule or pay), and limited job protections guaranteed by law or through collective agreements (e.g., lack of job benefits, social protections, health and safety protections, and other protections typically associated with standard employment).

These precarious attributes can exist in any employment relationship including standard employment, non-standard employment and self-employment.

For instance, in a standard employment relationship (SER), a person in a permanent full-time job may have annual earnings close to the low-income cut-off. This is a glaring precarious work attribute.

Alternatively, depending on the occupation, a person in part-time or on-call work (non-standard employment) could earn tens of thousands of dollars. Such a worker could secure benefits and protections similar to those available in SERs. In such cases, it would not be reasonable to categorize such work as precarious even though it is “non-standard.”

Furthermore, the experiences of gig workers differ depending on whether they are price takers (e.g. Uber drivers) or price setters (e.g. highly skilled coders). Price takers are more likely to be disproportionately affected by precarity, which is reflected in their working conditions. Policy makers must account for the varying experiences of gig workers.

Why Should We Define Gig Work?

When it comes to the future of work, technology is one of the most analyzed “mega trends” driving changes in the labour market today. There is significant interest in trying to predict the impacts of increased task automation and the use of artificial intelligence on the job market.

But another priority concerns policy makers, labour market experts and other stakeholders — the rise of the on-demand digital workforce.

The proliferation of the smartphone has paved the way for online applications (apps) that match workers with “on-demand” work. Through these digital interfaces, individuals, often called “gig workers,” can advertise their services and get matched to potential customers.

If we define gig work through this mediation by digital platforms, it can be considered a 21st century phenomenon requiring new approaches.

Gig workers typically lack access to labour protections afforded to workers in more traditional employment. They are also disproportionately exposed to risks such as low pay, lack of job benefits and uncertain work continuity — characteristics often associated with “precarity” (see Box 1).

As the share of individuals engaging in such digitally intermediated work increases, the erosion of workers’ rights and labour market instability [2] also increase.

Although on-demand digital work has only recently been facilitated by advances in technology, many features of this work are not new.

Independent contractors — individuals who are not employees but are contracted to do specific work with their own equipment and on their own schedules — share many of the same characteristics of on-demand digital workers.

Since contractors are not employees, they are not covered by employment legislation. They also bear the risks of uncertain work continuity, unpaid vacations and sick leave, and so on.

It is not surprising, then, to find many references in the literature where “gig work” is defined by the type of contractual arrangement between the payer and payee. In such cases, the type of contract determines whether an individual is engaged in “gig work” rather than how the work is mediated (i.e. online) or the level of risk that they bear (e.g., Kostyshyna & Luu, 2019). If this is the case, policy responses may focus on the legal aspects of the work rather than on the technology itself.

In contrast, other researchers focus on the precarity that often accompanies contract work. This approach defines gig work by its characteristics rather than whether it is electronically mediated or performed under a specific type of contract (e.g., Ziegler, McCallum, Porter, & Noshiravani, 2020).

By this definition, gig work might be considered no more than a re-labelling of already-existing work relationships, perhaps accelerated by the rise of digital work platforms. This may require more comprehensive approaches to alleviating precarity in whatever form of work it may be found.

[2] Erosion refers to the fact that “gig” workers often do not have access to collective bargaining agreements (i.e., the ability to unionize), job protections related to health and safety, labour standards (minimum wage and sick leave) and social security programs (employment insurance). For more information, see Backgrounder: Gig Workers and Digital Platform Workers (ESDC, 2021) and reports from Poverty and Employment Precarity in Southern Ontario (PEPSO).

Four Ways of Defining Gig Work

We reviewed 40 Canadian and international studies to identify the common approaches in how gig work is treated.

These approaches are not mutually exclusive; in many cases, gig work is defined by some combination of the three.

For example, work carried out by independent contractors often exhibits the same precarious characteristics used to define gig work. So, while definitions focusing on work characteristics may not specifically mention the contractual work arrangement, it can be hard to imagine such characteristics existing outside of a contract for service.

Table 1 summarizes common approaches to defining gig work.

Table 1: Common approaches for characterizing gig work
Component Definition Examples Key Sources
Digital Interface Gig work is any work mediated exclusively through a digital platform Uber driver; Cleanify cleaner; DoorDash courier Donovan et al. (2016); Schmidt (2017); Smith (2016)
Legal-Contractual Gig work is any work performed by an independent contractor Babysitter (not mediated by digital job platforms); Uber driver; freelance carpenter; freelance editor Kostyshyna & Luu (2019); Prudential (2019); ESDC (2021)
Work Characteristics Gig work is characterized by project- or task-based payment, irregular work schedules and unpredictable income Babysitter (not mediated by digital job platforms); Uber driver; informal household cleaner; Cleanify cleaner; DoorDash courier Woodcock & Graham (2020)
Combination Gig work is any work of short or uncertain duration performed by an independent contractor and characterized by task-based payment, irregular schedules and irregular income, including platform-enabled work Babysitter (not mediated by digital job platforms); Uber driver; Cleanify cleaner; DoorDash courier Graham et al. (2017); Stewart & Stanford (2017); Abraham et al. (2018); Ziegler et al. (2020); MacDonald & Giazitzoglu (2019)

 

Approach 1: Online interfaces

The first approach taken in discussing gig work — and the larger gig economy — is to focus on how the work is mediated (coordinated, organized and paid) via digital platforms or interfaces (websites or apps).

Popular examples include Uber, MTurk and Upwork. This approach suggests it is a strictly 21st century phenomenon. As a matter of fact, one study goes so far as to assert that — gig work is a new wave of work, altering and challenging the traditional standard employment model.

Although such researchers as Donovan et al. (2016) and Schmidt (2017) explicitly make the digital platform the defining feature, differences still exist within this approach.

For example, Donovan et al. (2016) defines gig workers simply as those who work for gig companies — on-demand companies such as Uber or TaskRabbit. Schmidt (2017), on the other hand, defines gig work as that belonging to a specific type of online platform. In so doing, they distinguish gig work from two other related types of work: “cloud work” and “crowd work.”

In this context, gig work must still be mediated via a digital app; it must also be tied to a specific location and time and be completed by one person.

In other words, if the work can be completed remotely or by several people, it is not gig work. Their definition largely limits gig work to accommodation, transportation and delivery, and household/personal service platforms.

Another complication that arises, contributing to the confusion around gig work, is that some researchers use terms such as “digitally mediated gig work” or “online gig work” (e.g., Smith, 2016).

While this practice emphasizes individuals who connect with work via digital interfaces, it implies that it is in fact a subset of gig work, thus alluding to some broader definition of gig work that is never made clear.

Experts have raised concerns about the lack of regulation for digital platform companies and the impact on worker rights.

Since digital platforms facilitate gig work on an unprecedented scale, new approaches will be required to ensure that workers relying on them are protected.

Some of these new approaches are already being implemented. In 2020, for example, some US workers successfully bargained for a minimum wage and job benefits such as health insurance. Other important job protections such as sick pay, however, remain largely unavailable. Labour law in Canada will need to be updated to better protect digital platform workers.

Approach 2: Legal-contractual nature of employment

Another approach that occurs often throughout the literature is to treat the term “gig worker” as synonymous with “independent contractor.”

In this way, gig work is characterized by a contract FOR service rather than a contract OF service. Whereas employees enter “contracts of service” with employers, independent contractors enter “contracts for service” with clients. They are self-employed workers who commit to another person or organization — the client — to carry out material or intellectual work, or to provide a service for a fee.

Kostyshyna and Luu (2019) and Prudential (2019) highlight the legal-contractual approach of defining gig work by equating gig workers with independent contractors, albeit with subtle differences.

For instance, Kostyshyna and Luu (2019), define gig work as “non-standard or informal work arrangements,” clearly focusing on the type of work arrangement involved. At first glance, the use of the phrase “non-standard” is problematic, because it can be misinterpreted as non-standard employment. However, the examples the authors provide — babysitting, housesitting, ride-sharing (Uber, Lyft), and completing online tasks via Amazon Turk — make it clear that they are referring to work conducted by independent contractors.

Similarly, Prudential (2019) defines gig work in legal-contractual terms. Specifically, they see gig work as a model “in which workers act as independent contractors rather than employees.” This includes “emerging companies through technology-enabled platforms” as well as “established firms.” Gig workers are described as self-employed individuals in the exchange of services or labour for pay. It is important to note that the authors exclude those who rent out assets — for example, individuals renting out their homes on Airbnb — from their definition.

While it is a strict approach to conceptualizing gig work, highlighting the legal-contractual aspect is not without its challenges.

The relationship between a payor and payee — whether in an employment relationship (contract of service) or independent contract (contract for service) — is a matter of law.

If one’s work arrangement changes because of new legislation, this impacts the status of “gig worker,” but it is not necessarily clear how.

For example, in 2019 the Ontario Labour Relations Board determined that couriers of the popular food delivery service Foodora were not independent contractors but rather employees. Equating independent contractors with gig workers means that these couriers are no longer gig workers, even though their work is mediated through a digital interface.

If, however, we define gig work based solely on the digital interface component, this reclassification would not impact their status as gig workers, making them gig workers who are employees, which further complicates matters.

A clear understanding of gig work is thus important regarding labour law.

Approach 3: Work characteristics

Gig work has also been defined in terms of the kinds of tasks involved, as well as other certain characteristics.

According to Woodcock and Graham (2020), gig work is distinguished by tasks that are “typically short, temporary, precarious and unpredictable” (p. 9), making gig work a form of patchwork.

Two additional characteristics include irregular schedules and uncertain income. Describing gig work in this way is why it is so often confused with precarity (see Box 1).

Other characteristics of gig work are not widely agreed upon but should be considered (see Box 2).

Project- or task-based payment is also said to be an underlying characteristic of gig work that represents how remuneration is structured. According to this approach, gig workers are compensated based on each project or task completed, rather than earning a salary or an hourly wage. For example, workers offering services on Amazon Turk are paid for tasks or projects upon completion, irrespective of the amount of time spent.

Moreover, this type of work is often associated with fluctuating demand for services, leading to irregular work schedules.

Workers can spend considerable time waiting for or looking for tasks/projects to be assigned resulting in unpaid hours worked. They appear to have autonomy over their work schedule since they decide when and how long to work, but they cannot control how much time it takes to complete a task or earn a pre-determined sum.

A DoorDash food courier, for example, is tasked with delivering a meal. The app provides only the delivery address and its proximity to the restaurant, not the true duration of the task. Time spent waiting in restaurants is unaccounted for and, during delivery, interruptions from traffic or technology glitches result in extended work time.

Since payment is task-based, gig workers according to this approach tend to work until they earn a pre-determined sum, irrespective of the time required.

Furthermore, gig workers are at risk of completing tasks or projects that they never get paid for if, for example, a client is unsatisfied or there are technological glitches.

Taken together, the combination of task-based payments and unpredictable and fluctuating demand means it is impossible to predict how much they will earn per hour or per day and, therefore, it is entirely possible to earn below the minimum wage.

As a result, irregular income is another core characteristic of gig work according to this approach.

It quickly becomes clear that many of the characteristics previously discussed overlap with characteristics of the work conducted by independent contractors. And this is one reason why defining gig work has been so inconsistent. However, the underlying feature of research using the “work characteristics” approach is that these are the defining features of gig work rather than the employment relationship (or lack thereof).

The characteristics attributed to gig work in this third approach reflect the many risks faced by independent contractors, including limited (or no) access to social benefits such as sick pay, pension, parental leave and employment insurance (EI) benefits, that are typically associated with many traditional employment relationships.

Thus, as gig work becomes more widespread across sectors, more workers may be without such benefits and protections in future (Woodcock, 2020).

Moreover, gig work — at least according to this narrow approach — is more likely to be disproportionately performed by marginalized workers such as immigrants, further entrenching social inequality.

Box 2: Other Characteristics

Some important characteristics of gig work are not widely agreed upon but should be mentioned.

These include the purchase of work equipment, providing one’s own workspace and work that is less structured than the standard employment relationship.

Gig workers provide some or all of the equipment used directly for the work, including the car, home and other tools. This caveat is one of the key differences between employees and independent contractors. Typically, employers provide the tools employees need to perform the job, whereas gig workers provide their own tools or workspace.

As well, definitions based on these characteristics of gig work have been complicated by the COVID-19 pandemic, which forced many workers to provide their own at-home workspaces and equipment.

Approach 4: Mixed approaches

Due to the complexity and lack of consensus as to what gig work means, some studies offer broad definitions that cut across two or more approaches: digital interface and legal-contractual (Graham et al., 2017); digital interface and work characteristics (Stewart & Stanford, 2017); legal-contractual and work characteristics (Abraham et al., 2018, Ziegler et al., 2020; or digital interface, legal-contractual and work characteristics (MacDonald & Giazitzoglu, 2019).

Graham et al. (2017) define gig work as temporary work allocated and delivered by digital platforms, without guarantees for long-term work. Clearly this definition combines the online interface and legal-contractual definitions, emphasizing that gig work must be mediated by a digital platform and highlighting the lack of long-term employment contracts.

Another study combining two approaches is that of Stewart and Stanford (2017). This study refers to gig work as on-demand work, usually organized around digital platforms and characterized by irregular schedules and payments. These workers provide their own equipment and place of work.

This definition combines the online interface and work characteristics approaches, emphasizing that gig work is typically mediated through a digital platform. It also explicitly lists several work characteristics such as irregular schedule and income.

Furthermore, Abraham et al. (2018) and Ziegler et al. (2020), define gig work as one-off jobs, where payments are structured around tasks, or for a defined period, and with unpredictable earnings and work schedules.

Both studies combine the legal-contractual and work characteristics; one-off and tasked-based jobs point to the former, while unpredictable earnings and work schedules are examples of the latter (see Box 3).

Finally, MacDonald and Giazitzoglu (2019), use all three approaches. In their study, gig work refers to short-term work advertised through online platforms, where independent contractors bid for a series of tasks.

This study clearly applies all three approaches: independent contractor refers to the legal-contractual definitions; advertised through online platforms refers to the online interface definitions; and short-term tasks is an example of work characteristics.

Box 3: A Mixed Approach to Measuring Gig Work Through Administrative Tax Data

In their seminal paper, Jeon et al. (2019) attempt to estimate the size of the gig economy using Canadian administrative tax data.

To define gig work, the authors used the mixed approach outlined in Abraham et al. (2018) that focuses on both the legal-contractual component and job characteristics.

In estimating the size of the gig economy in Canada, the authors hypothesize that “unincorporated self-employed workers (sole proprietors)” for whom tax data exist, most closely fit the criteria in Abraham et al. (2018) — on demand and/or freelance workers with irregular income and work schedules.

While their report specifically highlights the legal-contractual component, it does not define gig workers as such; rather, it asserts that workers with this type of work arrangement most closely match their mixed approach definition.

The Way Forward

Through our review of the literature, we found a wide range of specific, sometimes inconsistent approaches to discussing, measuring and defining gig work.

Research, policy and laws related to gig work are evolving not only in Canada but globally, so clarity as to what is implicated — and what is being left out — when gig work is discussed and analyzed is of growing importance.

Such clarity will be essential to better understanding gig employment and, as needed, the challenges associated with such types of work arrangements. This will help ensure that policy and program recommendations are data-driven and are designed to address the actual issue at hand.

To this end, Statistics Canada is working to develop a coherent framework for defining and collecting information on gig employment. Their work aims to ensure the alignment of statistical and legal definitions of gig employment that is consistent with the International Classification of Status in Employment. This represents an important step forward in shaping our collective efforts to understand and address the impact of gig employment on workers and society.

Acknowledgements

This LMI Insight Report was prepared by Bolanle Alake-Apata of LMIC. We would like to thank Vince Dale and Yuri Ostrovsky (Statistics Canada), Julie L’Allier, Natasha Leeder and Teresa Parsons (Employment and Social Development Canada), Martha Kornobis (Ontario Ministry of Labour, Training and Skills Development), Armine Yalnizyah (Atkinson Institute), Rachelle Taheri (Future Skills Centre) and Jim Stanford (Centre for Future Work) for their feedback and constructive comments.

For more information about this report, please contact Bolanle Alake-Apata, Economist, at bolanle.alake-apata@lmic-cimt.ca, or Tony Bonen, Director of Research, Data and Analytics, at tony.bonen@lmic-cimt.ca.

 

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Ziegler, E., McCallum, K. E., Porter, K., & Beketa, C. (2020, November). A typology of gig workers in Canada: Towards a new model for understanding gig work through human, social, and economic capital. Toronto: Future Skills Centre. https://fsc-ccf.ca/research/a-typology-of-gig-workers-in-canada-towards-a-new-model-for-understanding-gig-work-through-human-social-and-economic-capital/

Ziegler, E., McCallum, K. E., Porter, K., & Noshiravani, R. (2020, June 30). Understanding the nature and experience of gig work in Canada. Toronto: Future Skills Centre. https://fsc-ccf.ca/research/understanding-the-nature-and-experience-of-gig-work-in-canada/

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