By JUSTIN UMALI
Bulatlat.com
SAN PABLO, Laguna – Over the years, more and more workers are looking to mobile platform services as a means of employment in the Philippines, quickly becoming a significant player in the overall labor market. However, multiple groups are expressing concerns that the growing ‘platform economy’ remains unstable.
Mobile platform services like Grab and Food Panda employ over 400,000 workers, according to research think tank Fairwork Philippines. These workers form the platform economy, a growing subset meant to describe those employed by delivery, ride-sharing, and other service applications.
Platform workers form part of a larger ‘gig economy’, a term used by some economists to describe the trend of temporary, job-based contract work. Platform workers fall into this category owing to the nature of their work, where pay is dependent on how many orders they fulfill on a given day.
No stable platform for platform workers
Fairwork, which annually investigates and rates platform services based on criteria relating to ‘fairness’ in the work environment, has noted that platform workers are rarely secure in their work arrangement.
“Most workers cannot meet the basic minimum wage while also facing dangerous working conditions, a lack of safety nets, and long-term financial insecurity,” the group said in its 2024 assessment of the platform economy. “Many platform workers are left to suffer conditions of financial insecurity and major safety risks due to limited protections.”
Dr. Cheryl Ruth Soriano, principal investigator for Fairwork Philippines, stated that financial insecurity manifests through disproportionately long hours making minimum wage, the lack of provisions for added fuel cost due to infrastructure problems, and a lack of regulatory standards across payment methods, among others.
Platform workers often fall into debt either as a result of working or in the process of getting into the industry. Soriano noted that in many cases, workers took out loans to use as initial capital, usually to purchase motorcycles, fuel, shoulder maintenance costs, and so on.
However, low wages and irregular hours fail to offset these initial costs. Added costs such as processing fees and other charges made by the mobile platform service also serve to further shrink workers’ take-home pay.
Schemes like getting booked multiple orders from the same vendor at once, or getting booked multiple vendors in one order also end up minimizing workers’ profits, since riders get paid on a per order basis.
“Workers bear the costs of production in the platform economy,” Soriano said. According to her, a worker can make P750 (roughly US$13) in a day’s work but only take home as little as P290 ($5) due to fuel, food, and other costs.
The IBON Foundation calculates the family living wage, or the minimum daily wage needed by a family of four to maintain a decent standard of living, as P1,200 ($20.37).
Platform workers also have to contend with a lack of worker health and safety protocols in place. Soriano noted that almost all workers Fairwork interviewed said that they have met an accident at least once during their work.
Despite claims by mobile platform services that they provide insurance to their workers, Fairwork described the insurance process as “a byzantine affair” with variable processes for compensation and assistance. The group emphasized that the opacity in understanding and claiming insurance is a major hurdle in ensuring the safety of platform workers.
In some cases, platform workers have to contend with ‘quota insurance’ schemes which stipulate that riders must first reach a minimum number of delivery orders serviced before being entitled to insurance benefits. Most delivery service platforms also mandate that the platform worker can only claim insurance if they were injured while on delivery.
Legally, platform workers are offered very little protection, noted Fairwork legal consultant Atty Jayvy Gamboa. Platform workers are considered as ‘partners’, or ‘independent contractors,’ or ‘third-party service providers,’ which leads to workers losing out on legally-mandated benefits.
“This is despite the constitution’s mandate that ‘The state shall afford full protection to labor,’” he said.
Milky Garote, a rider working for the delivery service Foodpanda, said that he and his fellow workers had to sign “freelance agreements” as a prerequisite to being given access to the mobile application. “The agreements also didn’t say anything about payment,” he said, “only that we were agreeing to be considered as freelancers.”
The legal gray area in worker classification has resulted in cases of unfair labor practice within the platform worker industry. Even the Department of Labor and Employment acknowledges that there are gaps when it comes to protecting the rights of platform workers.
DOLE is treading unknown ground, said Institute of Labor Studies deputy executive director Atty. Mary Grace Riguer-Teodosio. “We still need to work out things like defining platform-based and freelance work, and how platform workers should be classified.” She added that classifying ‘new forms’ of work “may help workers in issues of constitutional protection.”
Teodosio also said that digital-only platforms also present a problem of jurisdiction, especially with some services having “no physical presence in the Philippines.”
Part of a larger problem
According to the IBON Foundation, some 20.8 million Filipinos, or 42 percent of the total workforce, engage in outright informal work. If irregular workers in private establishments are also included, the total number can reach as much as 35 million, or 70 percent of the total workforce.
The rise of informal work, including work from mobile platform services, is indicative of a worsening problem with the labor market, says IBON. “The dirty little secret is that jobs are really of lower and lower quality and being reported as ‘employed’ means less and less in terms of livelihoods,” the research group said.
Official government figures indicate that 2.2 million jobs were created from September 2023 to September 2024. IBON however points out that most of these jobs are “insecure, temporary, and low-paying,” with almost 53 percent belonging to services such as maids, cooks, drivers, houseboys, gardeners, and so on, or in retail sales employment such as groceries, supermarkets, sari-sari stores, and convenience stores.
IBON also noted that despite the increase in employment, there is also an increase in part-time work and the ‘invisibly underemployed’, or full-time workers who are seeking additional employment or income – indicating that current jobs fail to meet basic needs.
The rise of informal work also meant that Filipino families are getting poorer. A Social Weather Stations poverty survey indicated that 58 percent of Filipino families rated themselves as poor, while the Bangko Sentral ng Pilipinas’ Consumer Expectations Survey indicated that 19.2 million Filipino families, or 7 out of every 10 households, do not have any savings.
What can be done to improve the state of platform workers?
According to Fairwork, high-level policy changes can go a long way towards “fairer” work conditions for mobile platform workers.Gamboa highlighted some suggestions for reform outlined in their policy brief, such as obligating platform companies to provide a minimum number of bookings to workers to ensure a minimum wage, standardizing online payment systems, providing better hazard protection and response measures, and so on.
However, he recognizes that policy reforms are not enough. “A wide gap remains in policy in ensuring that platform workers are constitutionally protected,” said Gamboa. “Ultimately, what we’re aiming for is for platform companies to shoulder the responsibility of providing adequate work and pay for their workers.”
Currently, DOLE’s Labor Advisory No. 14-2021 serves as the basis for defining the rights of platform workers, in particular defining the mechanisms meant to establish an employer-employee relationship between platform workers and platform companies. Since then, workers from companies like Lazada have achieved legal victories in asserting their status as regular workers entitled to the rights and benefits that come with it.
There are also attempts to strengthen laws concerning delivery riders, such as the Freelancers Protection Act, which establishes that freelancers, including platform workers, are entitled to a minimum set of rights such as contracts, safe and healthy working conditions, just compensation, and the right to organize.
Ultimately, both platform workers and groups like Fairwork see unionization as the key to protecting workers’ rights. Unionization efforts by workers in J&T, Lazada, Foodpanda, and so on have managed to secure victories in increasing pay and securing rights for platform and delivery workers. In Cebu, platform workers have pushed for a Magna Carta for Delivery Riders as a means to secure protections for their rights as workers.
According to the National Union of Food Delivery Riders (RIDERS), organizing platform workers are still faced with challenges, ranging from union busting to legal loopholes. “We can say that we’re now on the radar of workers, the government, and platform companies,” said RIDERS National Coordinator Geoffrey Labudahon. “But we still face problems in organizing.”
“Despite this, union representation remains important to assert guaranteed income and benefits,” he added. (RVO)
