COS 2021: Own-account Workers’ Welfare

Mr Chua Kheng Wee Louis: Mr Chairman, based on the MOM’s latest 2020 labour statistics, own-account workers, defined as persons who operate their own business or trade without employing any workers – this includes taxi drivers, property agents, tour guides, freelance artists – account for 9.7% of the total workforce, or 228,000 workers, up from 8.8% in 2019.

While some own-account workers are truly independent, such as working proprietors, there are many who offer services as part of a wider organisation, such as taxi drivers, private hire car drivers and food delivery riders.

The COVID-19 pandemic has arguably pushed more workers into the so-called gig economy. Such a rise can also be attributed to the advent of aggregated apps such as Grab and Deliveroo, which have provided platforms for people to seek assignments in exchange for monetary incentives. 

We have to recognise that this is a sizable population of the workforce that is not protected by employment laws and regulations. These own-account workers are not deemed as employees of companies and the companies are also not obliged to provide CPF, medical insurance and other employee benefits for these people. Moreover, the own-account worker’s income is subject to incentive structures which companies can have the power to change at any point in time, without notice, and often do not require consent.

Many of these workers end up stuck in the cycle of insecure work, reducing their opportunities for career advancement and, as access to credit is restricted, exposing them to greater risk of financial shocks. 

For many of these own-account workers, especially in the ride hailing and delivery industries, they exhibit many employee-like characteristics such as working exclusively for one company and/or having fixed working arrangements and key performance indicators (KPIs) which are tied to that of the company.

On 19 February, the UK supreme court has upheld a ruling that Uber’s drivers should be classified as workers rather than independent contractors. California’s Proposition 22 ballot measure, passed by the voters in the November elections, could also serve as a third way of classifying such gig economy workers. It allows companies to offer private hire drivers partial benefits such as a minimum base pay that is higher than the minimum wage and healthcare subsidies for some drivers, depending on the number of hours that they work.

I would like to ask if more could be done to protect the interest and provide a safety net for this group of workers, such as mandatory insurance and minimum levels of benefits and protection for them.

Ministry of Manpower
2 March 2021

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