The Gig Economy Gets Its Props

Before Uber and Lyft built handy smartphone apps for their own gig workforce, freelancers acquired most jobs via word-of-mouth referrals, had harrowing second lives as bill collectors often waiting months to be paid, and taking the occasional spec job on good faith only to be burned for payment after work is completed. Then, just like that, everything changed.

A maltreated multitude no longer, gig workers have stepped into the light due largely to COVID-19 necessities and are poised to fulfill many valuable functions in the recovery to come.

The April 2020 Gig Economy Tracker® done in collaboration with Tipalti looks at the rapidly forming trends involving gig workers and their revitalized role as business picks up the pieces in the coronavirus pandemic’s aftermath. Among several things becoming clear about the gig economy and its workers is this: play with their pay at your own risk from here on out.

“Gig workers cannot function and will leave marketplace platforms if they are not being appropriately compensated,” Todd McGuire, general manager of supplier success for Tipalti told PYMNTS. “You cannot expect to pay them net 30 as you would a traditional supply chain. Payments have to be more frequent.”

Platforms and Partners 

Even as tens of millions contend with unemployment, gig workers are increasingly seen as central to the recovery effort. It may sound like 2008 all over again, but this is different.

“More traditional companies that have had to switch to remote operations may also be turning to freelancers as they find themselves working with tighter budgets and potentially with fewer team members following bottom line-saving measures like layoffs,” the report states, adding that, “Collaborating with freelancers could provide a solution by giving firms access to talented pinch hitters who can help complete projects without requiring companies to allocate funds for salaries and benefits.”

Online gig work platforms have predictably been seeing more activity in recent weeks as the newly unemployed on one side, and overwhelmed business owners on the other, seek a new (if temporary) arrangement. Platforms will prove their worth during this trying time.

“Partner onboarding is also critical at the same time. Seamless, self-service processes to bring on new gig workers — including capturing tax and payment details — is mission-critical in terms of payment processing,” Tipalti’s Todd McGuire told PYMNTS. “You cannot have your staff doing it. That process is not only insecure, but it also opens up organizations to risks, payment errors and manual effort costs. Finance teams are not customer support desks.”

Gig Workers to the Rescue

The apex of a pandemic is no time to appreciate irony, and the ranks of freelancers have no time to savor the absurdity that people ever hunting for work are now being head-hunted.

Expect more ironies small and large as the nation at long last recognizes gig workers.

“The COVID-19 outbreak has … highlighted factors that separate full-time workers from contractors — mainly how their earnings and healthcare costs are protected under employment regulations,” the report states. “Out-of-work freelancers cannot access unemployment benefits and may be unable to pay for their health insurance policies, but finding ways to give them protection has been difficult for companies and lawmakers as they confront diverse work levels, incomes and fields.”

“The decisions made regarding these workers now could thus significantly change how they are treated in the future, especially in countries that had been examining their earnings and healthcare coverage prior to the pandemic.”