Fairwork Ecuador Ratings 2021: Labour Standards in the Gig Economy
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Fairwork Ecuador
Ratings 2021:
Labour Standards in the
Gig Economy
2 | Fairwork Ecuador Ratings 2021
Executive Summary
Latin America has been at the centre of recent debates about
the precarious and unfair conditions of workers in the platform
economy. The Faiwork project is now present in four Latin
American countries - Chile, Colombia, Ecuador and Brazil. This
report on Ecuador presents the first set of Fairwork ratings for the
region. Six of the most prominent platforms in the country – Uber,
Cabify, Glovo, Rappi, Encargos y Envíos, and Ocre – were evaluated
against the five global principles of Fairwork.
The Ecuadorian economy is marked by exploitative working conditions. The organise multiple transnational
a lack of infrastructure, a low-skilled situation of these workers was further actions in 2020, demanding better
labour force, and an unequal social afflicted by an increase in labour and working conditions and employee
structure. Although a relatively new health risks associated with the COVID status. These movements and
phenomenon, the gig economy has 19 pandemic. With the rise in demand networks of solidarity represent a
gained increased momentum over the for delivery services during this period, counterbalance to platform power,
last four years, with both local and they became essential workers. pushing for collective negotiations not
international platforms competing in However, the support received from just locally but also globally. However,
the market. This trend was driven by platforms and the government has gig workers’ associations in Ecuador
the growth in internet connectivity and been insufficient to protect gig workers face significant limitations as they are
a large informal economy. Platforms from the pandemic. not recognised as unions by the law.
operate in a regulatory vacuum, Furthermore, platforms have so far
offering easy access to jobs to the Both local and international platforms failed to acknowledge and listen to the
unemployed and migrant population, operate in grey zones regarding collective voice of workers.
but at the risk of exploitative and taxation and labour conditions. Gig
precarious working conditions. workers in Ecuador are classified as Overall, our ratings reflect that there is
independent contractors. As such, much to be done to ensure fairness in
While there are no reliable statistics, platforms are not legally obliged to Ecuador’s emerging platform economy.
this report estimates that the platform protect them as they are not regarded In a context of insufficient local
economy employed 40,000 workers as employees. Platform workers are regulation, coordinated international
nationwide, representing about also not covered by social security action and incentives are needed
1 percent of the underemployed benefits unless they voluntarily to offset the unbalanced power of
population. With many losing their job contribute from their earnings. transnational platforms. A prominent
during the pandemic, we expect the Platforms exercise substantial example of this can be found in the
numbers to have increased. control over many aspects of the growing organising power of gig
labour process and, therefore, have workers’ movements in the region.
The gig economy model poses several an obligation towards their workers.
challenges to developing countries Workers who find their jobs through This report is the result of a one-year
such as Ecuador, which struggle platforms are ultimately still workers, pilot project in Ecuador. It establishes
to catch up with the technological and there is no basis for denying them a baseline on the current situation of
infrastructure and regulatory the key rights and protections that their the country’s platform economy that
framework needed to deal with these counterparts in the formal sector enjoy. will be updated on a yearly basis. By
new industries. raising awareness of the conditions
Fuelled by the worsening conditions of gig workers in Ecuador and across
This report highlights how platform during the pandemic, gig workers in Latin America, Fairwork aims to assist
workers in Ecuador face many Ecuador, Brazil, Chile, and other Latin workers, consumers and regulators in
difficulties, including the absence of American countries initiated the first making platforms accountable for their
labour rights, volatile incomes, lack international gig workers’ movement. practices.
of social benefits, and precarious and These workers joined together to
Labour Standards in the Platform Economy | 3
Key Findings � Fair Conditions: Only one of the
six platforms could be evidenced
� Fair Management: No platform
could be shown to allow due
The ratings achieved by the to have adopted policies to process for decisions affecting
�
platforms operating in Ecuador protect workers from risks workers. Often workers do
are very low, with no platform arising from their work. There not have the ability to appeal
scoring more than three points was no evidence of platforms deactivations or request
out of ten. Glovo, Encargos y implementing measures to information on why these
Envíos, and Ocre scored three actively improve working happened.
points, Uber and Cabify scored conditions beyond mitigating
task-specific risks. � Fair Representation: There was
two points, and Rappi scored one.
no evidence of any platform
Fair Pay: Across platforms, � Fair Contracts: Two platforms having a documented process
�
gig workers need to work the provided terms and conditions through which workers can
equivalent of a full-time job to in a clear, transparent and express their voices collectively.
earn over the legal minimum accessible form. Most platforms None of the platforms was found
wage in Ecuador, which is offer contracts governed by to have recognised workers’
relatively low. However, once overseas jurisdictions, limiting organisations or be willing to
work-related costs are factored workers’ ability to assert their acknowledge workers’ collective
in, only two platforms could prove rights through local legal voice, leaving them without
that their workers earn minimum channels. institutional channels for
wage. representation.
Fairwork Ecuador 2021 Scores*
Encargos y envíos 3
Glovo 33
Ocre 3
Cabify 2
Uber 2
Rappi 1
* Scores are out of 10.
4 | Fairwork Ecuador Ratings 2021
Editorial:
Towards Fair Work
As the new techno-economic revolution driven by data and
automation spreads across industries and countries, new forms of
management and organisation of work have begun to emerge. The
so-called “platform” or “gig” economy has gained momentum in
recent years, but new forms of organisation have also introduced
new forms of exploitation and risk for workers.
The adoption of new technologies platforms accountable for their concern whether workers receive fair
varies from country to country, as practices. pay for their work and if their jobs
does their impact on the economy and are characterised by healthy and
society. Countries with a long history The Fairwork project has already made safe working conditions. The other
of industrial and labour organisation evaluations of the platform economy in three focus on whether the platform
and strong social rights face different India, South Africa, and Germany. The has engaged in a fair contractual
problems in dealing with new forms of CTS LAB of the Latin American Faculty agreement with the workers, whether
economic and labour organisation than of Social Sciences FLACSO Ecuador there are clear and transparent
those with a weak industrial relations joined the Fairwork network in 2020, management processes and
tradition, limited regulation, and high and developed this first evaluation of communication channels, and whether
labour market informality. However, in the platform economy in Ecuador in workers can express themselves
both cases, the side effects of this new collaboration with the Oxford Internet collectively through open worker
economy have triggered reactions from Institute (OII) at the University of representation.
those directly affected by worsening Oxford, the Center for IT and National
working conditions and increasing Development (CITANDA) at the We assessed evidence against each
exploitation. University of Cape Town (UCT), the of these Fairwork principles through
Technical University of Berlin (TUB), a combination of desk research,
Indeed, the last year has seen the and other academic institutions from worker interviews in Quito, and semi-
emergence of a global gig workers’ more than twenty countries. structured interviews with platform
movement that has managed to managers. The novelty and complexity
organise a number of international This report presents the results of a of the platform economy make it
actions, demanding better working first evaluation of five core principles difficult to obtain reliable information
conditions in international delivery of fair platform work (Fair Pay, Fair about it. We, therefore, only award a
platforms. The movement originated Conditions, Fair Contracts, Fair point when there is clear and sufficient
with gig workers from Ecuador, Brazil, Management, and Fair Representation) evidence in support of a principle.
Chile, among other Latin American for a sample of six of the most visible We guarantee the independence and
countries, who have been significantly platforms operating in Ecuador: impartiality of the scoring process
affected by an increase in labour Uber, Cabify, Glovo, Rappi, Encargos through a rigorous internal review of
and health risks associated with the y Envíos, and Ocre. In the report, we every score we award.
COVID-19 pandemic. Since 2019, the evaluate each principle in two steps.
Fairwork project has been trying to We award scores out of ten to a We found evidence that the majority
raise awareness of the precarious and platform based on whether they meet of workers on these platforms
unfair conditions faced by platform a minimum threshold (one point) and receive an average monthly income
workers in their everyday lives. In then achieve a higher threshold (one slightly higher than the minimum
doing so, we aim to assist workers, additional point) for each of these five legal monthly wage. However, this
consumers and regulators to make principles. The first two principles average hides a few practices that
Labour Standards in the Platform Economy | 5
Contents
should not be neglected, such as the
existence of a black market of worker
accounts, and other subcontracting
practices that reduce workers’ annual
incomes. Unfortunately, in most
of these platforms, we found little
or no evidence of risk and health
02
coverage; clear, transparent, and
locally applicable contracts; fair and Executive Summary
transparent management; and the
right to be heard and represented
collectively. 04 Editorial
The economic turmoil triggered by
the COVID-19 pandemic in countries
like Ecuador will have long-lasting 06 The Fairwork Framework
consequences for social conditions.
Overview of the Ecuadorian Platform
08
Poverty and inequality will rise further,
and informality will continue to shadow Economy
labour relations and access to work and
11
income. In such a context, coordinated
international action and incentives are The Legal Context
needed to offset the lack of effective
12
regulation of platforms’ unbridled
power. The Fairwork framework offers Fairwork Scores
to workers, consumers, regulators
and companies a way to create such
incentives to build a fairer platform
economy.
14 Platform in Focus: Glovo
15 Workers’ Stories
Theme in Focus: The Rise of an
17 International Gig Workers’ Movement?
19 Impact and Next Steps
22 Appendix I: Fairwork Scoring System
26 Credits and Funding
27 Endnotes
Prof María Belén Albornoz
CTS LAB, Latin American
Faculty of Social Sciences,
Ecuador
Prof Henry Chávez
CTS LAB, Latin American
Faculty of Social Sciences
Ecuador
6 | Fairwork Ecuador Ratings 2021
01 The five
principles
Fair Pay
Workers, irrespective of their
employment classification, should earn
the mandated minimum wage in their
home jurisdiction after taking account
of work-related costs.
Fair Conditions
Platforms should have policies in place
to protect workers from risks arising
from the processes of work, and should
take proactive measures to protect
The
and promote the health and safety of
workers.
Fair Contracts
Fairwork
Terms and conditions should
be accessible, readble and
comprehensible. The party contracting
Framework
with the worker must be subject to
local law and must be identified in the
contract. If workers are genuinely self-
employed, the terms of service must
be free of clauses which unreasonably
exclude liability on the part of the
The Fairwork project evaluates platform.
the working conditions of digital Fair Management
platforms and ranks them on how There should be a documented process
through which workers can be heard,
well they do. Ultimately, our goal can appeal decisions affecting them,
and be informed of the reasons behind
is to show that better, and fairer those decisions. There must be a
jobs are possible in the platform clear channel of communication to
workers involving the ability to appeal
economy. management decisions or deactivation.
The use of algorithms must be
transparent and result in equitable
To do this, we use Fairwork’s five principles that digital platforms outcomes for workers. There should
should comply with in order to be considered to be offering ‘fair be an identifiable and documented
work’. We score platforms against these principles to show what policy to ensure equity in management
the platform economy is, and what it could be. The five Fairwork of workers on a platform (for example,
principles were developed in multistakeholder workshops at in the hiring, disciplining, or firing of
the International Labour Organisation. To ensure that these workers).
global principles were applicable in the Ecuadorian context, we
then revised and fine-tuned the criteria for measuring these in
consultation with platforms, trade unions, regulators, academics,
Fair Representation
Platforms should provide a documented
and labour lawyers in Quito.
process through which worker voice
Further details on each principle’s thresholds, and the criteria can be expressed. Irrespective of their
used to assess the collected evidence to score platforms, can employment classification, workers
be found in Appendix I. should have the right to organise in
collective bodies, and platforms should
be prepared to cooperate and negotiate
with them.
Labour Standards in the Platform Economy | 7
02 Methodology
The Fairwork project uses three approaches
to effectively measure fairness at work.
Desk Research
The process starts with desk research
to ascertain which platforms are
for a sample of 6-10 workers
operating in each city, as well as
interviews for each platform.
noting the largest and most influential
Workers are approached either
ones. This research provides the
through the platform directly or
overall range of the platforms that are
at known worker meeting points.
ranked, as well as identifying points
These interviews do not aim to build a
of contact or ways to access workers.
representative sample. They instead
Desk research also flags any public
seek to understand the process of
information that could be used to
work and the ways it is carried out
score particular platforms, for instance
and managed. They allow us, for
the provision of particular services to
instance, to see contracts and learn
workers, or ongoing disputes.
about platform policies that pertain to
03
workers. The interviews also allow the
Platform Interviews team to confirm or refute that policies How we
The second method involves or practices are really in place on the score
approaching platforms for evidence. platform.
We interview platform managers Each Fairwork principle is broken
and request evidence for each of the down into two points: a basic point
Fairwork principles. This provides Putting it all together and a more advanced point that can
insights into the operation and This threefold approach provides a only be awarded if the basic point
business model of the platform, while way to cross-check the claims made has been fulfilled. Every platform
also opens a dialogue through which by platforms, while also providing receives a score out of 10. Platforms
the platform could agree to implement the opportunity to collect evidence are only given a point when they
changes based on the principles. In from multiple sources. Final scores can satisfactorily demonstrate their
cases where platform managers do not are collectively decided by the implementation of the principles.
agree to be interviewed, we limit our Fairwork team based on all three
scoring strategy to evidence obtained forms of evidence. The scores are Failing to achieve a point does not
through desk research and worker peer-reviewed by the country team, necessarily mean that a platform
interviews. the Oxford team, and two reviewers does not comply with the principle in
from other Fairwork country teams. question; it simply means that we were
This provides consistency and rigour unable to evidence its compliance.
Worker Interviews to the scoring process. Points are only
The third method is interviewing awarded if clear evidence exists for See Appendix I for further details on
platform workers directly. We aim each threshold. the Fairwork scoring system.
8 | Fairwork Ecuador Ratings 2021
Overview
of the
Ecuadorian
Platform
Economy
The Ecuadorian economy is highly dependent on extractive
activities and commodities1. The high volatility of prices in the
production system has affected the country’s economic cycles
and undermined the development of other capital-intensive
industries. This has resulted in a lack of infrastructure, a
low-skilled labour force, and an unequal social structure.
Unemployment and informal employment are widespread. This
fact and the lack of appropriate regulation have created the
conditions for a proliferation of gig economy platforms offering
easy access to jobs and income, but at the risk of exploitation and
worsening working conditions.
The platform economy is a relatively 83 percent between 2019 and 2020,
new phenomenon in Ecuador. Most
More connectivity but to reach 24 Mbps2. However, most
international digital platforms with limitations of these connections are limited to
operating in the country, such as accessing Facebook and its services,
Cabify, Uber, and Glovo, started Despite its infrastructural deficit and such as WhatsApp and Instagram. This
operations within the last four years. socio-economic inequalities, Ecuador is because Ecuador’s mobile market
Local platforms, like Mynkana, Ocre has experienced a growing internet hides monopolistic practices, such as
App, Encargos y Envíos, and Kiárame penetration in recent years. By 2020, pre-paid plans with free and unlimited
have emerged within the past two about 89 percent of the population of access to these and other selected
years. All of them have registered a 17 million had a mobile phone, and 69 services but paid access to the rest of
growing number of users and workers percent had access to the internet and the internet. This has created a new
during this short period, which can be social media (6.8 percent more than divide between those who can afford
explained by a number of structural in 2019). Moreover, the average speed a standard open internet connection
factors. of internet connections increased by and those whose connectivity is limited
Labour Standards in the Platform Economy | 9
Myriam B / Shutterstock.com
to free services (74 percent of mobile Ecuadorian economy, they worsened their vulnerable condition10. In such
connections are pre-paid). as a result of the economic recession a situation, new digital platforms,
that started in 2015 due to a drop in oil with little if any entry barrier, appear
Related to these limitations, various prices. to many as an easy, if not the only
financial inclusion factors have created available source of income11. In
an even more restricted market for This shock reduced public revenues, sum, the convergence of the arrival
these kinds of online activities: only 55 and therefore the government’s of these platforms to Ecuador with
percent of the population have banking ability to maintain public spending.
services, 9 percent have a credit card, This led to the dismissal of many
and about 10 percent use online public employees and an increase
payments3. These numbers reflect the in the under-employed population
limitations of the local financial system -which already accounted for 49
for the new economy. percent of the workforce before the
crisis8. This deterioration of the labour
These and other institutional factors,
such as a lack of regulation4 and
market mainly affected the middle “We estimate the
class, whose consumption is mostly
cultural issues like the general mistrust sustained by credit. Hence, in the face platform market
of online payments5, have slowed the
expansion of users and workers of the
of a shrinking labour market and being
compelled to pay their debts in order before the pandemic
platform economy. to preserve their assets, many of these
former employees have turned to gig
comprised around
Crisis, unemployment, economy jobs offered by platforms like 1.5 million users and
Uber.
and migration a gig labour force
Finally, it is essential to highlight
As in many low and middle-income
countries, Ecuador has a highly
that Ecuador has received more of around 40,000
informal economy. By the end of 2019,
than 630,000 immigrants over
the last decade, many fleeing the workers nationwide.
only 38 percent of the economically
active population of 8 million had a
challenging situation in Colombia
and Venezuela9. Few of these people
This represents
regular job6. About 4 percent were
unemployed and the remaining 58
have found opportunities in Ecuador’s about 1 percent of
shrinking labour market, and many
percent had unpaid, underpaid or
part-time work7. Even if these numbers
have fallen into unemployment or the underemployed
reflect a long-term feature of the
underemployment, being exposed
to exploitation and abuse because of population.”10 | Fairwork Ecuador Ratings 2021
the economic recession, the rise of underemployed population13. developing countries such as Ecuador.
unemployment and underemployment, Barely prepared for the techno-
and a growing immigrant population Given that the current pandemic economic transformations introduced
looking for work opportunities, have restrictions have obliged many to turn by the automation of the economy,
fuelled a growth in the number of to mobile apps to provide themselves these countries struggle not only
workers who are willing to accept any with food and other essentials, and has to catch up with the technological
labour conditions in exchange for a pushed many others to engage in these infrastructure and capacities needed
relatively easy source of income. activities as the only available source of to deal with these new industries,
income, it is reasonable to expect the but especially with the lack of
number of both users and workers to
The gig economy in have increased in consequence.
regulation and institutional tools to
frame and manage the development
Ecuador: how big and of these activities and their social
Regarding these platforms’ working
how fair? conditions, from the evidence collected
and economic side effects. In such a
context, companies can operate in grey
for this report, we could evidence
As a new phenomenon, Ecuador’s gig zones regarding taxation and labour
that most workers earn more than the
economy is still an under-researched conditions14. Historically characterised
legal minimum hourly wage before
area, and we cannot count on reliable by a low level of enforcement of
costs (fuel, repairs, etc.). However, in
and up-to-date statistics on the local regulations, the governments in
most of the platforms we evaluated,
number of users, workers, sales, and countries like Ecuador need external
other fair working conditions are still
costs. To build such indicators is one incentives, such as international
lacking, including risk and health
of the main challenges for economic observance and cooperation, to
coverage; clear, transparent and
analysts in the coming years. develop such instruments and
locally applicable contracts; fair and
capacities.
Nonetheless, based on data gathered transparent management; and the
from public declarations, media right to be heard and represented Even locally-owned platforms prefer to
reports, and the interviews conducted collectively. We will discuss each of operate from foreign countries to avoid
for this report, we estimate that the these points later in this report. financial, labour, and taxation obstacles
platform market before the pandemic in Ecuador. This increases the risk of
comprised around 1.5 million users Challenges abuse of workers, and prevents any
and a gig labour force of around 40,000 regulation that considers local needs
workers nationwide12. This labour force The gig economy raises a number and expectations.
represents about 1 percent of the of specific issues and challenges in
Myriam B / Shutterstock.comLabour Standards in the Platform Economy | 11
The Legal Context
What Makes a Worker
an Employee?
In Ecuador, all digital platforms classify workers as independent
contractors, and have designed a legal path to circumvent labour
law by using contracts covered by civil law. This legal situation
creates a scenario that allows platforms to avoid recognising
worker’s employment rights. It is important that we analyse the
working conditions offered by digital platforms in order to develop
new forms of regulation and reform policies to protect workers.
Gig workers face a difficult situation employers to reach mutual agreements with full social benefits.
in relation to labour rights, volatile to change economic conditions, reduce
income, a lack of social benefits, working hours, and create temporary In the meantime, delivery workers
and precarious and exploitative emergency contracts, in order to avoid have joined three international and two
working conditions. According to further layoffs during the pandemic. national strikes to protest against the
platforms, workers are independent However, the Act did not consider harsh working conditions they have had
entrepreneurs who manage their autonomous workers. to endure during the pandemic19 and to
own time and have no boss. This way, fight for real worker autonomy and the
platforms are detached from any In October 2020, the Ministry of Labour right to be rehired as employees.
employment relationship. designed new employment contracts:
(i) young workers employment Platforms often exercise control over
However, most gig workers do not have contracts (ages 18 to 26)16; (ii) many aspects of the labour process
the freedom to decline work whenever entrepreneurship contracts 17; and (iii) but also often refrain from assuming
they want, because they are under productive sector special contracts18. obligations towards workers. In
strict control by platforms over their All these new contracts are governed this context, regulating platforms
schedules, routes, and prices. When under two working modalities: in Ecuador presents a significant
they choose to exercise such freedom, continuous and discontinuous. Hourly challenge: on the one hand, the State,
they become subject to disciplinary or daily pay can be stipulated if the which has hitherto indirectly supported
actions such as account deactivation, work is discontinuous – for instance the precariousness of labour; on the
lower ratings, and less work allocation. events-based, periodic or seasonal. other hand, gig worker associations,
Payment is by months or weeks if which face legal limitations as they are
Since gig workers are not considered there is a fixed-term employment not recognised as unions by law.
employees, they are only covered relationship. In both cases, social
by social security benefits if they security contributions and other
voluntarily contribute from their own legal benefits are paid based on the
earnings15. hours worked and the remuneration
agreed with the worker. These new
In the context of the COVID-19
employment contracts may incentivise
pandemic, the Humanitarian Support
platforms to change working terms and
Act was approved by the Ecuadorian
conditions into new contracts where
National Assembly in May 2020. This
workers are considered employees
labour reform allows workers and12 | Fairwork Ecuador Ratings 2021
Fairwork Scores
Score (out of 10)*
Encargos y envíos 3
Glovo 3
Ocre 3
Cabify 2
Uber 2
Rappi 1
* The breakdown of scores for individual platforms can be seen at: www.fair.work/ratingsLabour Standards in the Platform Economy | 13
platforms are incentivised not to affecting workers. Workers are
protect workers in order not to give very concerned that low ratings,
the appearance of an employment and performance falling below
relationship and therefore not to be the algorithms’ standards can
legally obliged to give them other lead to temporary suspension and
Fair Pay benefits as employees. deactivation. We found that workers
do not have the ability to appeal
The relatively low minimum wage in deactivations, or even understand
Ecuador (which is set at 400 USD a why they happened. This is why the
month) means that we could evidence Fairwork scoring system stipulates
gig workers who worked the equivalent that platforms must document the
of a full-time job20 to receive more than policies for disciplinary actions
this threshold. However, once work-
related costs are factored in, we found
Fair Contracts and deactivation in their terms and
conditions, alongside a transparent
evidence from only two platforms All Ecuadorian platforms provide process for workers to appeal
that workers take home more than documented terms and conditions decisions. We found no evidence that
the local minimum wage. Since 2019, which workers must sign in order to any of the platforms evaluated have
some platforms have changed their work on the platform. However, many active anti-discrimination policies.
algorithm, reducing the pay by the workers find these contracts difficult to
mileage and treating group orders as understand and are not fully aware of
a single order, resulting in workers their rights and obligations. We found
earning less than before. only two platforms providing terms and
conditions in a clear, transparent and
accessible form. Moreover, it has to be
highlighted that many of the contracts Fair Representation
given to workers were governed
by overseas jurisdictions, limiting We could not show any platform to
workers’ ability to assert their rights have a documented process through
Fair Conditions through local legal channels. which workers can express their voice
collectively. There was insufficient
Only one out of six platforms could be evidence that any platform currently
evidenced to have adopted policies recognises or is willing to recognise
to protect workers from risks arising worker organisations and collective
from their work. There is no evidence voice of workers. Overall, none of
that any platform is implementing the platforms showed an interest in
acknowledging worker collectivisation,
measures to actively improve working
conditions beyond mitigating task-
Fair Management which leaves most Ecuadorian platform
specific risks. This may be primarily workers without institutional channels
No platform could be shown to
due to workers being classified as for worker representation.
incorporate management processes
independent contractors. As such, allowing for due process for decisions
Myriam B / Shutterstock.com14 | Fairwork Ecuador Ratings 2021
Platform in Focus:
Glovo Total
Principle 1: Pays at least the local
minimum wage
Pays the local minimum
wage plus costs
1
Fair Pay
POINT
Principle 2:
Mitigates task-specific risks
Actively improves working
conditions
1
Fair Conditions
POINT
The contract genuinely
Principle 3: Clear terms and conditions
are available
reflects the nature of the 1
Fair Contracts employment relationship
POINT
Principle 4: Fair Provides due process for
decisions affecting workers
There is equity in the
management process
0
Management
POINTS
There is a collective body of
Includes freedom of
Principle 5: Fair
association and worker
workers that is recognised, and
that can undertake collective
0
Representation voice mechanism
POINTS
representation/bargaining
Glovo’s overall score 03
The ratings achieved by the platforms According to data provided by Glovo, Despite some positive steps,
operating in Ecuador are very low, with the vast majority of their workers the platform has yet to design a
no platform scoring above three out of earn above the Ecuadorian minimum transparent policy tool for disciplinary
ten. Only three platforms scored three wage with hourly earnings of 3.6 actions, which can be easily accessed
points (Glovo, Encargos y Envíos, and USD21. However, pay conditions have by workers. Workers therefore lack
Ocre), two scored two points (Uber changed over the past year. According a transparent process to appeal
and Cabify), and one scored a single to Glovo workers we interviewed, the decisions. Workers’ demands are still
point (Rappi). Among the platforms new algorithm used by the platform resolved on an individual basis, and
that achieved three points is Glovo, reduced the fee of each delivery from collective bargaining mechanisms have
an international platform operating 1.00 US to 0.30 USD. Workers are also not been developed. The series of
in Ecuador since 2018, and one of now forced to make group deliveries international gig workers’ protests in
the leading delivery platforms in the but only paid for one. The new fee Latin America reveals the need of such
country. per kilometre is 0.25 USD when the collective mechanism because of the
platform charges the client 0.80 USD. lack of communication channels and
Since 2019, Glovo has founded a new Many “Glovers” are demanding to willingness of this and other platforms
company in Ecuador so that contracts return to the 2019 payment rules. to process and address workers’
signed by workers are governed by demands for better working conditions.
Ecuadorian law and not by Spanish As part of co-responsibility for
law. This critical change in contract workers’ health and safety, Glovo
arrangements allows workers to appeal provides training in partnership with
to local law in case of legal disputes, agencies like the Metropolitan Transit
which improves the mediation of their Agency (MTA) to strengthen workers’
claims. knowledge of rules, and to foster sound
practices and road safety culture.Labour Standards in the Platform Economy | 15
Workers’ Stories
Lucía* arrived in Ecuador from Venezuela transit agents to admonish Uber’s drivers, who
three years ago and shortly thereafter started are forced to pay a fee of 750 USD if they are
working for Uber, thanks to her network stopped by the police. In addition to the fact
Lucía of friends. This platform offered her a job
opportunity that was difficult to find anywhere
that she is required to pay 40 percent of her
income to the car owner, Lucia must work more
Uber Driver else, although she had to rent a car in order than ten hours a day to earn about 400 USD net
to start working. Nevertheless, her migrant a month.
status soon presented her with a series of
barriers that began to make her working Being a woman and a foreigner, she is
conditions precarious. Not having a work visa, subjected to many acts of discrimination by
she was subcontracted by the owner of the customers, who cancel their orders when it
car she drives, so she does not have a direct is evident that the car’s driver is a woman. To
relationship with Uber, and she has not signed avoid personal safety risks, she has chosen to
a contract with the platform. work during the day’s peak hours and avoid
driving at night. In this context, it has been
“There is a very large black market of accounts essential to be part of a WhatsApp chat in
and profiles on all platforms. I found out that which she can learn about the city’s police
the owner of the vehicle I now drive was controls, ask for help if she feels in danger, and
looking for a driver and I contacted him thanks share information on improving her working
to some friends who knew him. I am lucky conditions. The irregular conditions prevent her
because I don’t pay him 50% of my income. from thinking about joining a platform workers’
Many other acquaintances have to pay more union. She only hopes to obtain a work visa that
than me to be able to work.” will allow her to improve her income.
This situation places her in a vulnerable
position before the police, since Uber’s legal
*Names changed status in Ecuador is still being negotiated. She
to protect worker must face the continual raids carried out by the
identity
BlackFarm / Shutterstock.com
The Road Provides / Shutterstock.com16 | Fairwork Ecuador Ratings 2021
Alex Torrenegra / Flickr
Rafael* has worked in the public sector for over the platforms’ emergency support centre. He
20 years. In 2017, he was fired from his job said to be grateful to have the opportunity to
at a government agency. For several months, work and earn money, but he does not feel
Rafael he could not get a new job and decided to use
his car to earn some money. Now his primary
that the platform really cares about his safety,
and it’s not improving his precarious working
Uber/Cabify job is divided between Cabify and Uber. He conditions. Furthermore, the scoring and
had a hard time understanding how the two performance mechanisms of the platform push
Driver
platforms work, what the best paid hours are, him to work long hours without been rewarded
how to get more passengers and how to reduce with social benefits, freedom and security
spending on gas and car parts. He now works measures.
from 3am to 10am, rests for a few hours and
then returns to work for the afternoon rush
hour. He earns 1,200 USD a month and gets a
break on the weekends.
Although he does not receive the same salary
as when he worked for the government, he
manages to support his family and owns
his own time. This job has taught him other
aspects of the city that were unknown to
him and he shares his knowledge with other
friends through WhatsApp. Being connected
is the key to avoiding many risks in his job,
given the limited support he receives from
the platforms. In the case of an accident, he
feels more protected by his colleagues, who
*Names changed
have immediately come to his aid, rather than
to protect worker
identityLabour Standards in the Platform Economy | 17
Theme in Focus:
The Rise of an
International Gig
Workers’ Movement?
The COVID-19 pandemic has caused death, suffering, and chaos
around the world. It has unveiled the structural problems of
an unsustainable and unequal global system and the limits of
country-centred frameworks of analysis, regulation, governance,
and action. It seems clear that many of the problems faced by
nations due to the pandemic result from global trends that need
to be addressed globally.
Governments and regulators are slow gig workers to find common channels
to implement change. This is not the to discuss, organise themselves, and
case for transnational actors such undertake collective actions to demand
as gig platforms, which can operate better working conditions.23
globally under different regulatory “Despite the
This is exactly what has happened
systems but with the same business
models.22 These transnational actors in Ecuador and other Latin American isolation imposed
concentrate power and capital through
their global value chains, giving them
countries during the global lockdown
due to COVID-19. The increased on workers by the
a relative advantage over local actors demand for delivery services during
this period highlighted this labour
very design of these
and states themselves. Hence, by
the time a local regulation or policy is force’s social and economic relevance, platforms, social
as many platform workers have
implemented, it will be very likely that
platforms have already updated their become essential in this “new normal”. media (...) have
model to avoid it.
However, the pandemic has also enabled gig workers
Nonetheless, thanks to the very same
technologies that have enabled the
revealed the worsening labour
conditions of gig workers, the lack of to find common
rise and proliferation of gig economy social benefits and even occupational
safety, not to mention the significant
channels to discuss,
platforms around the world, many local
actors can organise and communicate health risks to which they are exposed. organise themselves
Social networks have allowed many
their problems and complaints about
this new labour regime on a global workers to report and share their and conduct
scale. Despite the isolation imposed
on workers by these platforms’ very
complaints about platforms during
the pandemic. This creates awareness collective actions
design, social media and mobile among workers in other parts of the
world about the common issues they
to claim for better
communication services have enabled
face, and the need to act collectively at working conditions”18 | Fairwork Ecuador Ratings 2021
Isadora Romero, National Geographic (August 2020)24
a local and global scale. of collective deliveries that made
them work more for less money. They
This collective awareness has led to the also asked for platforms to provide
organisation of several international accident and health insurance,
strikes against the deteriorating personal protective equipment during
working conditions on delivery the pandemic, the reclassification of
platforms, and the emergence of the their status as employees, and the
first forms of association and collective improvement of working conditions.
organisation of gig workers, not only
locally but internationally.25 In the absence of a more dynamic and
coordinated response from national
In Ecuador, several groups of gig governments, this coordinated
workers started to self-organise international action can have a positive
through WhatsApp groups, creating impact by creating incentives for the
the basis of a collective organisation. platforms to behave in a more socially
They participated in four cross- responsible manner.
platform strikes, three of which were
coordinated internationally with This is precisely one of the Fairwork
other workers’ collectives from Latin project’s objectives: to introduce
America (Argentina, Peru, Costa Rica, incentives through global action for
Guatemala, Mexico, Brazil) and Spain. better regulation of the platform
ecosystem.26
These strikes brought together gig
workers from Glovo, Uber Eats, Rappi
and a number of other platforms.
They protested a reduction in the
pay rate they receive for each “gig”
and the imposition of a new systemLabour Standards in the Platform Economy | 19
Impact
and Next Steps
Our first and most direct pathway to
This report is the result of a one-year pilot improving working conditions in the
project in Ecuador. We have established platform economy is by engaging
directly with Ecuador’s platforms. Many
a baseline on the current situation of the platforms are aware of the importance
of regulating mechanisms such as the
country’s platform economy that will let Fairwork framework to enhance the
platform ecosystem.
us study its development and update our
They are eager to work with us to
ratings on an annual basis. As Fairwork’s improve their Fairwork scores. Guided
reach and visibility increases, we see four by our principles, the platforms can
easily focus on the conditions that
avenues for contributing to improvements need to be enhanced to provide
better job and income opportunities
in the conditions faced by Ecuadorian for their workers, while maintaining
a growing, safer, and fairer business.
platform workers. Fairwork Ecuador has started to raise
awareness among platforms about
these principles and succeeded in
establishing a collaboration channel
with some platforms to get first-hand
information about their practices and
policies.
Fairwork’s theory of change also draws
on the understanding that human
empathy is a powerful force. Given
enough information, many consumers
will be intentional about the platforms
they choose to interact with. Our
yearly ratings give consumers the
ability to select the highest scoring
platform operating in a sector, thus
contributing to pressure on platforms
to improve their working conditions
and their scores. In this way, we enable
consumers to ally with workers to fight
for a fairer gig economy.
Beyond individual consumer
choices, our scores can help inform
larger organisational customers’
procurement, investment, and
partnership policies. They can serve
as a reference for institutions and
companies who want to support fair
labour practices and more ethical
procurement.
Fairwork’s Pathways to Change20 | Fairwork Ecuador Ratings 2021
Fairwork’s Principles: Continuous
Worker-guided Evolution
Fairwork
Principles
Changes to Principles
(agreed at annual Fairwork symposium that
brings together all country teams)
Periodic International Annual Country-level Yearly Fieldwork
Stakeholder Stakeholder across Fairwork
Consultations Consultations Countries
(involving gig workers’, workers’ (involving gig workers’, workers’ (involving surveys and in-depth
organisations, cooperatives, etc) organisations, cooperatives, etc) interviews of gig workers)
Ongoing Advocacy Efforts
(involving campaigns for worker rights and
support to workers’ organisations)
We also engage with policymakers involving workers, informs how we Our principles can provide a starting
and the government to advocate for systematically evolve the Fairwork point for envisioning a fairer future of
extending appropriate legal protections principles to remain in line with their work, and set out a pathway to realise
to all platform workers, irrespective needs. Through continual engagement it. Principle five, in particular, on the
of their legal classification. We will with workers’ representatives importance of fair representation, is a
continue our policy advocacy efforts and advocates, we aim to support crucial way in which we aim to support
in the coming years to help ensure workers in asserting their rights and workers to assert their collective
that workers’ needs and platforms’ requirements in a collective way. agency.
business imperatives are effectively
balanced. A key challenge in the gig economy There is nothing inevitable about poor
is that workers are often isolated, working conditions in the gig economy.
Finally, and most importantly, workers atomised, and placed in competition. Notwithstanding their claims to the
and workers’ organisations are at The platform work model presents contrary, platforms have substantial
the core of Fairwork’s model. Our challenges for workers to connect and control over the nature of the jobs that
principles have been developed create networks of solidarity. However, they mediate. Workers who find their
and are continually refined in close as we have witnessed during recent jobs through platforms are ultimately
consultation with workers and their international strikes led by delivery gig still workers, and there is no basis
representatives. Our fieldwork workers, they are starting to organise for denying them the key rights and
data, combined with feedback and push for collective negotiations protections that their counterparts in
from workshops and consultations not just locally but also internationally. the formal sector enjoy. Our scoresLabour Standards in the Platform Economy | 21 show that the gig economy, as we know it today, already takes many forms, with some platforms displaying greater concern for workers’ needs than others. This means that we do not need to accept low pay, poor conditions, inequity, and a lack of agency and voice as the norm. We hope that our work highlights today’s gig economy’s contours and paints a picture of what it could become.
22 | Fairwork Ecuador Ratings 2021
Appendix I:
Fairwork Scoring
System
The five Principles of Fairwork were each Principle, the scoring system A platform can therefore receive a
developed through an extensive allows one ‘basic point’ to be awarded maximum Fairwork Score of ten points.
literature review of published corresponding to the first threshold, Fairwork scores are updated on a
research on job quality, stakeholder and an additional ‘advanced point’ yearly basis.
meetings at UNCTAD and the ILO to be awarded corresponding to the
in Geneva (involving platform second threshold (see Table 1). The
operators, policymakers, trade unions, advanced point under each Principle
and academics), and in-country can only be awarded if the basic point
stakeholder meetings held in India for that Principle has been awarded.
(Bangalore and Ahmedabad), South The thresholds specify the evidence
Africa (Cape Town and Johannesburg) required for a platform to receive
and Germany (Berlin). This document a given point. Where no verifiable
explains the Fairwork Scoring System evidence is available that meets a given
Each Fairwork Principle is divided threshold, the platform is not awarded
into two thresholds. Accordingly, for that point.
Table 1 Fairwork Scoring System
Principle Basic point Advanced point Total
Fair Pay 1
+ 1
= 2
Fair Conditions 1
+ 1
= 2
Fair Contracts 1
+ 1
= 2
Fair Management 1
+ 1
= 2
Fair Representation 1
+ 1
= 2
Maximum possible Fairwork Score 10Labour Standards in the Platform Economy | 23
months.
Threshold 1.2 – Pays the
minimum wage plus costs (one
Principle 1: additional point) Principle 2:
Fair Pay Workers earn at least the local Fair Conditions
minimum wage after work-related
Threshold 1.1 – Pays at least costs, or there is a policy which
Threshold 2.1 – Mitigates task-
the local minimum wage (one requires payment above this level. specific risks (one point)
point) There are policies to protect workers
The threshold for the minimum wage
plus costs varies between different from risks that arise from the processes
Irrespective of the employment status
kinds of platform work. In order to of work.
of the worker, workers earn at least
a local minimum wage, or there is a establish a threshold, the platform is
This threshold requires the platform
policy which requires payment above asked to provide an estimate for work-
to ensure that there are safe working
this level. related costs, which are then checked
conditions, and that potential harms
(by the Fairwork team) through worker
are minimised.32 For 2.1, this means
The threshold for 1.1 is based on the interviews.31 To be awarded this point,
identifying the task-specific risks
level for a local minimum wage (400 there must be either:
for the worker when, for example, a
USD).27 Workers on the platform must
• A policy that guarantees workers vehicle is used, or there is interaction
earn more than the minimum wage rate
earn at least the local minimum with customers. The specific practices
in their working time,28 and this can be
wage plus costs; or leading to the awarding of this point
evidenced by either:
may vary by the type of work and the
• A policy that guarantees the • Evidence from the platform that risks involved.
workers receive at least the local workers earn at least the local
minimum wage plus costs. To be awarded a point for 2.1, the
minimum wage in their working
platform must demonstrate that:
time; or
If the platform has completed Table 2,
the mean weekly earnings minus the • There are policies or practices in
• The provision of summary
estimated work-related costs must be place that protect workers’ health
statistics of transaction data.
above the local minimum wage (see and safety from task-specific risks
In the case of (b), the platform is asked Table 2 below).
to submit a weekly earnings table (see Threshold 2.2 – Actively
Table 2) that averages worker earnings improves working conditions
and worker hours for any three-month (one additional point)
period over the previous twelve
Table 2 Weekly earnings table
X to
Weekly earnings 2X
(X+(X/2))
Active hours less than 40 hours/week (part-time) % % % %
Active hours between 40 and 48 hours/week (full-time) % % % %
Active hours more than 48 hours/week (full-time plus overtime) % % % %
Note: X = the local minimum wage, calculated at 45 hours per week. This row is filled out by the Fairwork team, before
submitting it to the platform for completion.3024 | Fairwork Ecuador Ratings 2021
There are proactive measures to This is necessary for workers to in the contract issued by the
protect and promote the health and understand the requirements of their platform; and,
safety of workers or improve working work. The contracts should be easily
conditions. understandable by workers, and • There is no unresolved dispute
available in the language/languages about the nature of the
For 2.2, the threshold is higher, commonly spoken by the workers on employment relationship; or,
involving practices that go beyond the platform.
addressing the task-specific risks • The self-employed status
addressed by 2.1. This means a To be awarded a point for 3.1, the of the worker is adequately
policy that goes beyond ameliorating platform must demonstrate all of the demonstrated and free from
the direct task-specific risks, by following: unreasonable clauses.
promoting greater health and safety or
improvements in working conditions, • The contract is written in clear and
beyond what is specified by local comprehensible language that
regulations for employment. For the worker could be expected to
example, an insurance policy that understand; and,
covers workplace accidents would
meet the threshold for 2.1, while one
• The contract is issued in the
language/languages spoken by
Principle 4:
that also covers the worker or their
family outside of work would meet
workers on the platform; and, Fair Management
2.2. As policies and practices may be • The contract is available for Threshold 4.1 – There is due
focused on the specific form of work, workers to access at all times.
the examples that meet the threshold
process for decisions affecting
may vary by the type of work. Threshold 3.2 – The contract workers (one point)
To be awarded a point for 2.2, the
genuinely reflects the nature of There is a documented process
platform must demonstrate that: the employment relationship through which workers can be heard,
(one additional point) can appeal decisions affecting them,
• There is a documented policy (or and be informed of the reasons
policies) that promotes the health The party contracting with the worker behind those decisions. There is a
and safety of workers or improves must be subject to local law and must clear channel of communication to
working conditions, going beyond be identified in the contract. If workers workers involving the ability to appeal
addressing task-specific risks are genuinely self-employed, the terms management decisions or deactivation.
of service are free of clauses which
unreasonably exclude liability on the The threshold for 4.1 involves a
part of the platform. platform demonstrating the existence
of clearly defined processes for
The threshold for 3.2 involves the communication between workers and
platforms demonstrating that the the platform. This includes access by
contract issued to workers accurately workers to a platform representative,
Principle 3: describes the relationship between and the ability to discuss decisions
Fair Contracts the platform, the workers, and the made about the worker. Platforms must
users. In the case where there is an be able to evidence that information
Threshold 3.1 – Clear terms unresolved dispute over the nature of about the processes is also easily
and conditions are available the employment relationship, a point accessible to workers.
will not be awarded.
(one point) To be awarded a point for 4.1, the
If workers are genuinely self- platform must demonstrate all of the
The terms and conditions are
employed,34 platforms must be able to following:
transparent, concise, and provided to
demonstrate that the contract is free
workers in an accessible form. • The contract includes a
of clauses that unreasonably exclude
liability on the part of the platform documented channel for workers
The threshold for 3.1 involves
for harm caused to the workers in the to communicate with a designated
demonstrating that the terms and
course of carrying out their duties. representative of the platform; and,
conditions of the contract issued to
workers are available in an accessible • The contract includes a
To be awarded a point for 3.2, the
form.33 Platforms must demonstrate documented process for workers
platform must demonstrate that:
that the contracts are accessible for to appeal disciplinary decisions or
workers at all times, whether through • The employment status of the deactivations; and,
the app itself or direct communication workers is accurately defined
with the worker. • The platform interface featuresYou can also read
