The Gig Economy is changing the way people think about employment. It allows individuals to earn money on a regular basis and build a career without a fixed salary or job title. However, employers are now facing the challenges that come along with hiring workers on demand. These companies must determine which types of employees are right for the business, and how to make sure that they are given the training they need to do their jobs well.
AB5 exemptions for certain “professional services”
Assembly Bill 5 (AB5) is an expansion of the Labor Code and Unemployment Insurance Code. Its effects will affect California businesses and workers. The law is expected to take effect January 1, 2020.
AB 5 includes an exemption for certain “professional services.” These services include payment processing agents, real estate licensees, and repossession agencies. A service provider must meet 12 criteria to be considered an exemption.
Among the criteria are the need for a separate business location, providing own equipment and tools, and the absence of control over the contracting entity. Professional services include creative professions, such as writers and photographers. Other types of professionals included in the list are real estate appraisers, proofers, content contributors, songwriters, recording artists, and musicians.
Another exemption is provided for referral services. For example, an ad agency may refer clients to a freelance writer or photographer. Likewise, a newspaper publishing company may refer readers to a freelance journalist.
A boundaryless career is a career that doesn’t fit predefined parameters. In the gig economy, this means individuals may simultaneously work for several platforms. They also may not have the skills needed to perform certain tasks. However, they may be better suited for a job in the gig economy than someone who has traditional employment.
Boundaryless careers require three main competencies. These are a set of transferable skills, a sense of what the industry is about and a way to do it.
The first two competencies are important to the second. This is because these skills predict platform ecosystems. For example, the knowing-how competency is more relevant if the platform is offline. Similarly, the way you do it is more important if you are offline.
A gig career is an interesting albeit controversial concept. It is a three-way relationship between the individual, the platform and the client. Platforms have vested interests in retaining workers. Unfortunately, they have very little formal organisational support. Consequently, it is very difficult for an individual to find and secure placement. Additionally, the nature of the gig economy prevents development opportunities.
Identifying and providing key skill sets for gig workers
Identifying and providing key skill sets for gig workers can help improve their motivation, boost their performance and increase their commitment to the platform. It can also benefit their overall compensation.
Gig workers are independent contractors who provide services for platforms’ clients. These clients can be institutions, end users, or individual consumers. As such, these workers often have a wide range of career aspirations.
Although gig work can be rewarding, it also comes with its share of downsides. For example, there are few social interactions and a lack of hierarchical reporting relationships. This can lead to a sense of isolation and dependence on the platform. In addition, employers may find it difficult to manage their expectations.
Likewise, a lack of feedback can limit a worker’s ability to develop competencies. A well-developed career plan can also aid in the transition from gig to traditional employment. However, some workers have found this difficult.
HR function will be on the front line
The gig economy has created a number of challenges for HR. With many workers becoming more comfortable working on their own, employers have a greater challenge in ensuring employees are engaged. Having a strong and cohesive HR function will be necessary to manage this new type of work.
Traditionally, HR has focused on managing permanent employees. However, this new model of work will require HR to invest in a new workforce ecosystem. This will include gig workers and contractors. It will also enable HR to play a more pronounced role in enabling remote work.
The HR function will need to shift from a dominant organisational lens to a more diverse perspective. For example, the human touch will remain required for evaluating performance and for developing talent.
In addition, HR will be required to integrate gig workers into the value chain and to ensure that opportunities for gig work are meaningful and durable. As a result, HR can play a key role in facilitating the transition of gig workers into the traditional workplace.