This Magazine

Progressive politics, ideas & culture

January-February 2021

The gig is up

App-based workers in Canada are taking things into their own hands

Ryan Hayes

Art by Valerie Thai

“I remember thinking to myself: if this is the future of work, then the future is going to be hell,” recounts bike courier Brice Sopher. Sopher began working for Toronto food delivery startup Hurrier in 2015 after getting laid off from his office job. As an event promoter and DJ, he was attracted to the flexible hours of app-based work.

But the honeymoon period was short-lived. Toronto’s harsh winter took a toll on Sopher. He also noticed a shift after Hurrier was bought by Berlin-based Foodora, a multinational food delivery platform. “I received texts if I wasn’t moving fast enough,” says Sopher. “In theory I was an independent contractor, but I was being treated as an employee.”

By misclassifying workers as independent contractors, platforms are able to exercise control over their workforce while evading responsibility for employment standards like minimum wage, vacation, and severance pay. Couriers shoulder the risks involved with slow business days, delays, accidents, repairs, and injuries. “We have all the worst parts of being an employee without any of the benefits,” says Sopher.

Foodora couriers started to organize in late 2018 and won a historic union drive with the Canadian Union of Postal Workers in February 2020. Two months later, Foodora announced their exit from the Canadian market. The company pulled a similar move in Australia in 2018. Foodora left after the country’s Fair Work Ombudsman began proceedings against them for engaging in “sham contracting” that resulted in the underpayment of workers.

Sopher and his colleagues with the Foodsters United unionization campaign vowed to continue their efforts to fix the gig economy. One idea they are pursuing is creating a worker-owned platform. Their initiative is part of a global network of cooperatives that aim to provide an alternative to the race-to-the-bottom “platform capitalism” modelled by Foodora and other gig economy apps like Uber, Lyft, Instacart, TaskRabbit, SkipTheDishes, and DoorDash.

There are a range of “platform co-ops” in Canada already—web and mobile app-based services that are worker-owned. Some are in the early stages of development, while others have proven track records going back more than a decade. Like traditional co-ops, they aim to sustain a business with decent working conditions and democratic oversight. Upholding these principles in a profit-driven capitalist economy is no easy task. Platform co-ops have the additional challenge—or opportunity—of delivering the convenience promised by new forms of technology.

Along with Sopher and several others, Rob Gill enrolled in an online course offered by The New School’s Institute for the Cooperative Digital Economy, a university research centre that organizes an annual conference on cooperative platforms. “I do enjoy courier work, as shady as these companies are,” says Gill. “We’re interested in a completely different business model.” Before moving to Toronto about five years ago, Gill lived in Huntsville, where he participated in the Muskoka North Good Food Co-op, which currently hosts a grocery store, cafe, and shared commercial kitchen space under one roof. His previous co-op experience has helped him to imagine how a worker-run platform might do things differently.

Gill points to the partnership struck up between Foodsters United and Toronto food justice nonprofit FoodShare to deliver food boxes during the pandemic as an example of a more community-oriented approach. He believes that platforms have a duty to provide rigorous health and safety training for the hazards of courier work—and that they must find better ways to address harassment experienced by women. The vulnerability of migrant workers
in gig work—where they are overrepresented—is also an area of concern. According to Statistics Canada, immigrant men are almost twice as likely to be gig workers as Canadian-born men. “We want there to be a place for people just coming to the country like international students to find decent employment, so they are not immediately being exploited,” says Gill.

When he is not delivering food or completing gigs via TaskRabbit, a platform for hiring freelance workers that was acquired by Ikea in 2017, Gill is a digital media artist. He is helping to explore software tools to meet their nascent co-op’s needs. One option is CoopCycle, a website and mobile app used by a federation of over 40 delivery co-ops primarily based in Europe. “There are proprietary options out there, but CoopCycle is open source [for worker-owned businesses], which means we have control of the software and can modify it as we want,” says Gill.

CoopCycle’s software is also used by Shift Delivery in Vancouver. Shift launched in 2011 and completed over 100,000 deliveries in their first five years. They currently have 25 staff and a fleet of electric tricycles that can haul up to 500 pounds. When the pandemic hit, Shift decided to focus exclusively on bringing groceries to homes and meals to vulnerable communities.. They managed to double their delivery capacity by borrowing cargo vans from Modo, a carsharing co-op formed in 1997.

Worker-owner Sandra Allen says that Shift brought on 11 new hires in the past six months to meet increased demand. “We hired mostly women this round,” says Allen, who has worked with Shift for two years. “We try to hire people who are under-represented in the courier world.” Shift has found success as a business-to-business service with a roster of regular clients, but they also have plans to experiment with on-demand food delivery using the CoopCycle platform.

Economist Juliet Schor believes that cooperative platforms have the potential to realize some of the early promises of the sharing economy. In her book After the Gig, she writes about how apps like Uber and TaskRabbit emerged in the wake of the 2008 financial crisis. They claimed to address the “problems of work under capitalism” by “empowering individuals to work for themselves” with the support of a platform. Over a decade later, the value of these companies has grown by billions, but the workers who provide their services remain stuck in low-wage work that resembles the on-call, piece-rate model that originated in the 19th century.

Gig economy apps rapidly scaled up and maintain a competitive advantage by evading regulation, including by spending unprecedented sums on lobbying efforts. Venture capital funding allows them to sustain staggering losses in their longterm pursuit of monopoly market power. Uber lost $1.8 billion (U.S.) in 2018 and $8.5 billion (U.S.) in 2019. In contrast, Schor sees the platform co-op model as a “structural innovation” to the unsustainable gig economy. Precarious workers can harness technology while stepping into a shared ownership role with cooperative platforms.

Schor highlights Victoria-based Stocksy United as one of the first and now one of the largest platform co-ops. Stocksy was founded in 2013 by the former heads of the conventional stock photography website iStock. After the sale of the business to Getty Images in 2006, photographers complained about their declining share of revenues. Co-founders Bruce Livingstone and Brianna Wettlaufer financed Stocksy with a $1 million loan that was paid back over three years. Compared with 15 to 45 percent of other major stock photography agencies, Stocksy returns 50 to 75 percent of sales revenues to the contributor. The remaining funds pay for staffing and the ongoing development of the platform. It has paid out over $40 million to its members.

Stocksy chose careful growth as a means of quality control, with 1,400 contributors in 70 different countries. Due to their dispersed membership, Stocksy introduced an efficient method for online decision-making. According to CEO Mike Cook, any member can put forward a proposal for discussion via their online forum.

Once a 10 percent threshold is met, the proposal is vetted by the board for conflicts of interest, then either adopted immediately or sent back to the membership for a binding majority vote.

As co-ops grow in scale, they must resist pressure to turn away from their democratic roots. The unexpected sale of Canadian retailer Mountain Equipment Co-op (MEC) to an American venture capital firm for approximately $150 million caught many by surprise, including its over 5 million members who were never consulted.

For Stephanie Guico, vice-president of the research and advocacy organization Co-operatives and Mutuals Canada, the MEC case touches on the importance of building stronger safeguards into cooperative organizations. “The people who came together to create MEC in the Lower Mainland of B.C. in the early 1970s may have seen their business change beyond recognition,” she says. “It’s important to have conversations about growth and minimum viable democracy—what is ‘democratic enough?’”

Guico is currently delivering a webinar series on cooperative platforms as part of a project funded by the City of Montreal. “Some people assume that co-ops have to be hyper-local, brick and mortar, and face-to-face, but co-op values can translate into the digital world,” says Guico.

She recalls a “life changing” experience in New York City, where Guico worked alongside organizations such as the Center for Family Life in Brooklyn, which has incubated worker-owned cooperatives for the past 14 years. She assisted early efforts to develop an app for professional cleaning services with five pre-existing co-ops run by immigrant women. Launched in 2017, Up & Go enables the cleaners to set their own wages. They earn $25 (U.S.) per hour—double what workers tend to earn on their own. Five percent of sales are reinvested in the platform, which is owned by the workers. They meet every two weeks to discuss policies and make decisions. Guico says Up & Go is a platform that responds to the needs of workers rather than the other way around.

In a similar vein, Radish is a new food delivery platform in Montreal. Co-founders Mansib Rahman and Qudsia Saadat want to challenge the grip that predatory food delivery apps hold over the restaurant industry. “My friends say they’re going to order Uber Eats for dinner, but it’s important to remember where our food is actually coming from,” says Saadat. The Uber Eats model provides a seamless service to customers, in part by masking the unappetizing inequalities that are rife across the entire food system.

Rahman is a self-taught computer programmer whose family has owned restaurants since he was young. He dropped out of university to support the family businesses when his father fell ill. Speaking about the influence of giant tech companies, Rahman says, “Most of those people never worked in a restaurant. They’re imposing their way of doing things on small businesses.” Radish launched in March with a pilot group of four restaurants in the Parc-Extension neighbourhood. This is an area with Montreal’s highest concentration of immigrants, which is currently grappling with an influx of gentrification, partly due to a new Université de Montreal campus. Radish has expanded to 10 restaurants across the city.

It is a multi-stakeholder co-op, which means that restaurants, workers, and consumers all have a seat at the decision-making table. When asked about how the co-op will address inevitable tensions between these groups, Rahman offers, “Our view is that you can’t avoid conflict. Unlike giant companies that try to have no discussion at all, we want to increase transparency and put people on a level playing field,” he says.

Radish has two drivers on staff. Members of the six-person development team also fulfill orders when needed. As the branding and marketing director, Saadat is responsible for ensuring that each restaurant has a unique profile on the Radish website. While on a delivery run, Saadat noticed that the takeout containers from a restaurant partner were causing spills. After receiving her feedback, the restaurant changed their containers. Saadat points to this exchange as evidence of the cooperative advantage when parties are invested in each other’s success.

Radish hopes to expand from web-based ordering to a mobile app. “We’re not at a break-even point yet, but we feel like we’ll get there before Uber does,” quips Rahman. He notes that Quebec is unique for its relatively high support for local businesses via grants and loans from the government and social finance institutions like Desjardins, the largest federation of credit unions in North America. By incorporating as a co-op federally, Radish is able to sell a share of its ownership to raise capital, however investors in the co-op are limited by law to 20 percent of board seats regardless of their overall stake.

Ridesharing alternative Eva launched their app in Montreal in 2019 with $800,000 in public and private backing. They have 850 registered drivers and 28,000 rider members in their multi-stakeholder co-op. Before the pandemic, 30 percent of Eva’s rides came from the airport, where they have a dedicated booth and parking spaces. During the COVID-19 crisis, they invested in plexiglass screens for drivers, then pivoted to offering a delivery service with local businesses when the demand for rides bottomed out.

Chief operating officer Dardan Isufi acknowledges that they are in an uphill, capital-intensive battle against Uber. “It’s very David versus Goliath.” To be efficient, Isufi explains that apps must achieve a “network effect” by building a critical mass of customers.

“From a product standpoint, gig economy apps offer a good service. But they haven’t solved how to make it sustainable,” says Rahman. “That’s what we’re trying to figure out.” Ensuring fair minimum orders—no single bubble teas carted from one end of the city to the other—and pay rates takes on increased importance when you remove deep subsidies from investors and coercion of precarious workers who fear punishment by an algorithm.

Sopher, the former Foodora courier, sees the lack of profitability as part of a deliberate strategy by gig economy apps. “Their primary goal is not to make money—it’s to dominate the market.” If platforms eliminate their competition, they can dictate wages and prices, and make good on the multi-billion dollar bets made by their backers. “We want to make an industry that works for everyone,” he says.

Cooperative platforms are a credible alternative, but they also face very real challenges. They are not a panacea for all the gig economy’s problems. According to Guico, “If labour laws are still shoddy, then decent work will remain elusive” due to the lack of a level playing field between firms. Sopher agrees on the need to organize for regulatory reforms as part of a broader movement for change. He compares co-ops’ push for democracy at work to the bottom-up culture that couriers cultivated during their union drive. “We have a philosophy of horizontal power, where we all share leadership and responsibility, and that basically describes what a co-op is as well.”

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