Fairwork Chile 2021 Ratings: Labour Standards in the Gig Economy
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Fairwork Chile
2021 Ratings:
Labour Standards in
the Gig Economy
2 | Fairwork Chile 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
Fairwork project is now present in five Latin American countries—Chile,
Colombia, Ecuador, Argentina and Brazil. This report on Chile presents
the second set of Fairwork ratings for the region, following the 2021 report
on Ecuador. For this report, seven of the most prominent platforms in
Chile—Uber, Uber Eats, Cabify, Rappi, Pedidos Ya, and DiDi—were evaluated
against the five global principles of Fairwork.
The gig economy in Chile has been promise of managing your own time, regulate these applications and grant
slowly consolidating, with early at your own pace, and being your own rights to gig workers—a need that has
adoption of transportation apps boss — presented as an advantage to become especially pressing in the
(Uber and Cabify), followed by workers — gig work also brings with context of the pandemic, which has
delivery for restaurants (Pedidos Ya, it various forms of precariousness, exposed gig workers to new risks.
Rappi), and groceries (Cornershop, a exhausting shifts, exposure to risks,
Chilean-designed app that operates and few labour protections. Users, for In Chile, as in many other countries,
internationally and was recently their part, may not see or understand the pandemic has deepened existing
acquired by Uber). The economic these risks clearly, since they value the inequalities, especially for women
effects of the COVID-19 pandemic in convenience, speed, and low prices of and migrants, who suffer greater
Chile have encouraged thousands of these platforms. vulnerabilities. Moreover, the economic
formal workers to join the gig economy. recession, with the associated loss
Demand from consumers has also In this context, the public agenda of work and salary cuts, has forced
increased, with many businesses, has begun to focus on the precarious migrant workers to work more hours
especially restaurants, having to close working conditions faced by gig on the platforms, especially given their
their doors during the pandemic. At the workers, including the unequal access uncertain (or worse, undocumented)
time of writing, there are approximately to safety and health protection tools immigration status, and lack of access
15,000 app delivery drivers and during the pandemic, and the lack of to public health coverage, often due
200,000 ride-hailers in Chile. However, financial compensation when workers to a fear of being deported. Although
there are no reliable statistics to were unable to work. The Chilean case worsening economic conditions are of
measure the size of this market. This is no exception. This report explores concern to platforms, they are a real
report invites local authorities, such as the working conditions in the local gig threat to workers, who bear most of
the National Statistics Institute-INE, economy to contribute to improving the the risks of the work. The asymmetry of
to include the gig economy labor force standards for those who participate in risk between workers and the platform
in the country’s official employment this market. has been exacerbated during the
measures, to have certainty of the size pandemic; it is, therefore, crucial that
The legal status of gig workers, the Chile’s government further regulates
of this market.
relationship between worker and this market to guarantee fair labour
The growth of digital work platforms platform, and the inadequacy of current conditions and basic protections for gig
has been highly favoured by structural regulations is currently the subject of workers.
conditions in Chile: a liberal economic debate among legal practitioners and
history, high internet penetration, and political actors in Chile. By blurring Overall, our ratings reflect that there
a significant flow of migrant labour. the distinction between independent is much to be done to ensure fairness
Since the turn of the century, Chile has and subordinate work, gig work in Chile’s emerging platform economy.
enjoyed one of the highest levels of creates tensions with traditional legal The results demonstrate the need
internet penetration in Latin America. frameworks, and the legal system has to gather more, and increase the
This has favoured the rise of the gig been forced to question the tools at transparency of, information on this
economy, with more jobs, flexibility and its disposal. There are currently at market - its functions, its size, the
independence. Notwithstanding, the least three legislative bills looking to income generated by its workers,
Labour Standards in the Platform Economy | 3
and the labour trajectories of those pandemic (such as the provision of workers’ organizations to
who are part of it. Our findings call for of masks and gel), only four were generate agreements and review
urgent regulation that fits the size and found to provide some form of existing working conditions.
relevance of this burgeoning market, financial support in cases where While there are associations of
and that addresses its particularities. workers contracted the disease. ride-hailing drivers and delivery
We call on regulators, platforms, Greater efforts are required in riders, they are not formally
workers, and consumers to use this this area to match the risks faced recognized by the platforms.
information to rethink the organization by delivery workers and drivers in This leaves gig workers in Chile
and functioning of this market. This the course of their work. without mechanisms of formal
is especially relevant in the context representation or opportunities to
of the COVID-19 pandemic, where � Fair contracts: All agreements either cooperate with each other
unemployment and the economic classify workers as independent or to influence decisions that
needs of millions of workers demands contractors, either through an impact the process of work.
a re-imagining of a fairer gig economy explicit clause on their contract
for everyone. (which normally includes a
statement denying any type
This report is the result of a one-year of regulation by labour law) or
pilot project in Chile. It establishes a through the general framing of
baseline on the current situation of the clauses drafted. As a general
the country’s platform economy that rule, the contracts or terms
will be updated on a yearly basis. By and conditions drafted by the
raising awareness of the conditions companies were found to be
of gig workers in Chile and across easily accessible to workers,
Latin America, Fairwork aims to assist both in terms of terminology and
workers, consumers and regulators in language, even though certain
making platforms accountable for their clauses were drafted in technical
practices. legal language. However, with
the exception of one company
Key findings (Cornershop), we could not find
any instance in which platforms
� The ratings achieved by the cannot unilaterally make changes
platforms operating in Chile are to their terms, with differences
very low, with no platform scoring regarding the manner of notifying
more than two points out of ten. and enforcing such changes.
Uber, Cornershop, Cabify, Pedidos
Ya, and Uber Eats all scored two � Fair management: Only three
points, Rappi and DiDi scored of the seven platforms could
one. be evidenced to have clear
communication channels with
� Fair Pay: Workers were found to their workers, through the
earn above the local minimum chat or other communication
wage (in Chile, $326,500 pesos systems in the applications
for a 45-hour workweek) before themselves. There is no fluid and
costs are considered. However, direct contact with managers
none of the platforms was able to or executives, and in most of
evidence that they pay a fair wage the platforms, once workers are
after accounting for workers’ deactivated from the platform,
expenses, such as gasoline, they cannot appeal a decision.
and depreciation of the car, We could not find any information
motorcycle or bicycle. on the use of data and personal
information of workers by the
� Fair Conditions: No platform platforms.
was able to provide evidence of
concrete and consistent policies � Fair Representation: The
aimed at protecting workers from principle of fair representation
any task-specific risks. Although was not achieved by any of the
all seven of the platforms we platforms we analyzed. None
analyzed implemented measures of them was found to recognize
from the beginning of the or facilitate the existence
4 | Fairwork Chile Ratings 2021
Fairwork Chile 2021 Scores*
Cabify 2
Cornershop 2 3
Pedidos Ya 2
Uber 2
Uber Eats 2
Didi 1
Rappi 1
* Scores are out of 10.
Labour Standards in the Platform Economy | 5
Editorial:
Why study the gig
economy in Chile? An
introduction to the
Fairwork project
Among its many consequences, the COVID-19 pandemic has reinforced our
relationships with digital technologies, at the same time forcing a change in
our habits and forms of consumption from supermarkets, restaurants, and
clothing stores. In this process of change, delivery and digital gig workers have
been fundamental in consolidating an emerging market for goods and services
mediated and organized by digital applications—namely the “gig” economy.
The gig economy is a labor market fragmentation of work, where different 20% in the case of Pedidos Ya, and
characterized by worker independence, costs are being transferred from 78% in the case of Cabify (Bohle,
where the supply of and demand for company to worker.5 2020). Demand from consumers has
labor is organized through a digital also increased, with many businesses,
algorithmic infrastructure. There is a The gig economy in Chile has been especially restaurants, having to close
“labor–capital” relationship between slowly consolidating, with early their doors during the pandemic.
worker and digital platform: the latter adoption through transportation At the time of writing, there are
mediates the supply of labor and the apps (Uber and Cabify), followed by approximately 15,000 app delivery
demand for professional services, delivery for restaurants (Pedidos Ya, drivers and 200,000 ride-hailers in
operating as an intermediary, or Rappi) and groceries (Cornershop, a Chile (Bohle, 2020; Comisión Nacional
“ghost employer”.1 Indeed, there are Chilean-designed app that operates de Productividad, 2019).
tens of millions of people globally internationally and was recently
who work in the gig economy.2 Global acquired by Uber). The economic In this context, the public agenda
applications like Uber have become effects of the pandemic in Chile has has begun to focus on the precarious
a source of work for those who have encouraged thousands of formal working conditions faced by gig
been left out of the traditional formal market workers to integrate into workers, including unequal access
labor market.3 However, contrary to the gig economy. According to the to safety and health protection tools
the promises disclosed by economists National Institute of Statistics (INE), during the pandemic, and a lack of
and management experts regarding the unemployment reached 13% for May financial compensation when unable
possibilities of labor flexibility,4 recent – July 2020 and 10% for November– to work. The Chilean case is no
sociology and economic geography January (2020-2021) (INE, 2021). At exception. This report explores gig
studies in the US and UK have warned the same time, a recent media article economy working conditions in order
of increasing precariousness and titled as “historic” the increase in the to contribute to improved standards for
number of delivery workers, reaching those who participate in this market.
6 | Fairwork Chile Ratings 2021
Alongside reports from India and South depend on the willingness of platforms
Africa (2019, 2020), Germany (2020), to participate.
Ecuador (2021) and the UK (2021)
the Fairwork project is beginning to The results demonstrate the need
conduct South American country to gather and increase transparency
case studies in Argentina, Brazil, of information on this market and
Colombia, and Chile. The School of its functions, its size, the income
Communications and Journalism at generated by its workers, and the labor
the Universidad Adolfo Ibáñez has trajectories of those who are part of it.
worked with the Oxford Internet Our findings call for urgent regulation
Institute (University of Oxford) that fits the size and relevance of this
and the University of Cape Town to burgeoning market, and that addresses
implement the Fairwork methodology its particularities. We call on regulators,
in order to assess working conditions platforms, workers, and consumers
in the Chilean gig economy and make to use this information to rethink the
suggestions for improvement. organization and functioning of this
market. This is especially so in the
The analysis presented in this report context of the COVID-19 pandemic,
is based on five basic principles of where unemployment and the
fair work in the gig economy: fair pay, economic needs of millions of workers
fair conditions, fair contracts, fair require a re-imagining for a fairer gig
management, and fair representation. economy for everyone.
Each principle is divided into two sub-
principles, which together total ten
points. We award one point when we
find that basic conditions are met and
an extra point when more advanced
standards are achieved. The first two
principles refer to whether workers
receive fair pay for their work and
whether their jobs are characterized by “At the time of
healthy and safe working conditions.
The second three focus on whether
writing, there are
the platform has engaged in fair approximately
contractual agreements with workers;
whether workers are aware of 15,000 app delivery
these conditions; whether there are
transparent management processes drivers and 200,000
and communication channels
between the parties; and whether
ride-hailers in
workers are able to express their Chile.”
demands collectively through different
representation mechanisms.
The evidence we gathered included
desk research, interviews with
workers in Chile, a workshop with
different actors in the gig economy
(platform representatives, workers, and
policymakers), and semi-structured
interviews with platform managers. We
recognize that it is difficult to obtain
reliable information due to the dynamic
nature of this economy, and the
confidentiality of the data. Therefore,
we only award a point when there is
clear and sufficient evidence to support
the fulfillment of a principle. In other
words, our research strategy does not
Labour Standards in the Platform Economy | 7
Contents
02 Executive Summary
05 Editorial
08 The Fairwork Framework
10 Overview of the Gig Economy in Chile
13 The Legal Context
15 Fairwork Scores
17 Platform in Focus: Cornershop
18 Workers’ Stories
20 Theme in Focus: The other front-line:
COVID-19 and gig workers in Chile
21 Impact and Next Steps
23 Appendix I: Fairwork Scoring System
28 Credits and Funding
29 Endnotes
Arturo Arriagada
Macarena Bonhomme
Jorge Leyton
Francisco Ibáñez
Fairwork Chile Team
8 | Fairwork Chile 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.
Fairwork
Fair Contracts
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
platform.
The Fairwork project evaluates
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
clear channel of communication to
jobs are possible in the platform workers involving the ability to appeal
economy. management decisions or deactivation.
The use of algorithms must be
transparent and result in equitable
outcomes for workers. There should
To do this, we use Fairwork’s five principles that digital platforms
be an identifiable and documented
should comply with in order to be considered to be offering ‘fair
policy to ensure equity in management
work’. We score platforms against these principles to show what
of workers on a platform (for example,
the platform economy is, and what it could be. The five Fairwork
in the hiring, disciplining, or firing of
principles were developed in multistakeholder workshops at the
workers).
International Labour Organisation. To ensure that these global
principles were applicable in the Chilean context, we then revised
and fine-tuned the criteria for measuring these in consultation Fair Representation
with platforms, trade unions, regulators, academics, and labour Platforms should provide a documented
lawyers in Santiago. process through which worker voice
can be expressed. Irrespective of their
Further details on each principle’s thresholds, and the criteria
employment classification, workers
used to assess the collected evidence to score platforms, can
should have the right to organise in
be found in Appendix I.
collective bodies, and platforms should
be prepared to cooperate and negotiate
with them.
Labour Standards in the Platform Economy | 9
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
operating in each city, as well as sample of 6-10 workers interviews
noting the largest and most influential for each platform. Workers are
ones. This research provides the approached either through the
overall range of the platforms that are platform directly or at known worker
ranked, as well as identifying points meeting points. These interviews
of contact or ways to access workers. do not aim to build a representative
Desk research also flags any public sample. They instead seek to
information that could be used to understand the process of work and
score particular platforms, for instance the ways it is carried out and managed.
the provision of particular services to They allow us, for instance, to see
workers, or ongoing disputes. contracts and learn about platform
03
policies that pertain to workers.
Platform Interviews
The interviews also allow the team
to confirm or refute that policies or
How we
The second method involves 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 See Appendix I for further details on
awarded if clear evidence exists for
platform workers directly. We aim for a the Fairwork scoring system.
each threshold.10 | Fairwork Chile Ratings 2021
Overview
of the gig
economy in
Chile
The growth of digital work platforms has been highly favored by
structural conditions in Chile: a liberal economic history, high
internet penetration, and a significant flow of migrant labor. In
the following section, we will review some of these factors and
the development of the gig economy in the country.
Chile: favorable smartphones and mobile devices few guarantees from the applications.
accounting for 84.7% of these.7 As Users, for their part, do not see these
conditions for the gig of June 2019, there were more than risks clearly, since they value the
economy 25 million active cell phones in the convenience, speed, and low prices of
country, with 4G connections growing these platforms.
Chile underwent a drastic process more than 20% compared to the
of economic liberalization during its same period of 2018.8 Similarly, the One of the first major platforms in Chile
military dictatorship in the 1980s, population has avidly incorporated was parcel and delivery application
under the guidance of a group of new platforms and social media into Pedidos Ya, present since 2010. While
young neoliberal economists. Although their daily lives. In 2008, Chile had a number of different transportation
still debated, these policies were at the most Fotolog accounts worldwide, and delivery applications gradually
least partially responsible for the at 4.8 million; and that same year entered the market, it was not until
economic boom following the return of created more than 4 million new the arrival of Uber in 2014 that the
democracy in the 1990s. At that time, profiles on Facebook.9 This context has gig economy saw significant growth,
Chile saw an average GDP growth of contributed to building the necessary with Uber alone accounting for more
over 5% and an increase in access to devices and user infrastructure for a than 70,000 “driver partners” and
credit, with a significant reduction in digital platform market. two million registered users by 2018.
poverty from 38% in 1990 to 18.8% in By that same year, there were a
2003.6 This has favored the rise of the gig total of 200,000 drivers working for
economy, with more jobs, flexibility and various transportation platforms.10
Since the turn of the century, Chile independence. Notwithstanding, the We include in our research also a
has had one of the highest levels of promise of managing your own time, number of delivery platforms, including
internet penetration in Latin America. at your own pace, and being your own Cornershop, a Chilean–Swedish
Where in 2009 the penetration rate boss—presented as an advantage to development company founded in
was 13.7 internet connections per workers—also brings with it various 2015, which found its niche in the
100 inhabitants, by 2019 this had forms of precariousness, exhausting parcel market, especially supermarket
increased to 116.1 connections, with shifts, exposure to risky situations, and shopping. The true reach of these newLabour Standards in the Platform Economy | 11
abriendomundo / Shutterstock.com
platforms is difficult to pinpoint, due to their own set of rules and qualifications
the difficulty of obtaining data from the for their drivers, some of them laxer.
companies behind the apps. There is a perceived uneven field with
formal workers, especially in the urban
In our research, we examined the transport sector, where taxi drivers
experience of workers for Uber, Cabify, have been vocal in manifesting their
DiDi, UberEats, Rappi, Pedidos Ya, and
Cornershop. While these seven apps
discomfort to the point of intimidating “The promise of
or threatening local platform drivers.
are among the most prominent, there Demand for more regulation has also managing your own
are other apps operating in Chile which
may share similar working conditions
come from the gig workers themselves,
especially those in the delivery sector, time, at your own
and day-to-day problems. who have gathered with their bicycles
and backpacks to visibly protest the
pace, and being your
Demands for greater precarious situations and risks they own boss—presented
take,11 even though demonstrations
regulation have cost many their jobs in retaliation as an advantage to
A large part of the Chilean gig
workforce is vulnerable, and tensions
by the companies.
workers—also brings
between different social groups—for
There are currently at least three bills
looking to regulate these applications with it various forms
example, local cab drivers intimidating
transportation gig workers—are
and grant rights to gig workers—a need
which has become especially pressing
of precariousness,
exacerbated by a number of factors,
including the lack of regulation for
in the context of the pandemic, during exhausting shifts,
which gig workers are exposed to new
platforms, the delay in discussions on
the matter, and its effects on the labor
risks. exposure to risky
market.
COVID-19: New situations, and few
Demands for greater regulation have
conditions and risks guarantees from the
come from competing sectors. For
instance, license fees, tariffs and The economy has been shaken by applications. ”
conditions for taxis are determined the coronavirus and the restrictions it
by the Ministry of Transportation and imposes, putting several companies
Communication, while platforms have and the jobs of thousands of people12 | Fairwork Chile Ratings 2021 at risk. According to data from a longitudinal study by the Pontificia Universidad Católica de Chile,12 July 2020 saw a drop in employment, from 58.2% to 42.4%, compared to the previous year. During this dire time, urban mobility platforms like Uber or Cabify have had to curtail operations during the most stringent stages of confinement. This intermittent activity has had economic consequences and leaves workers uncertain about their futures. Meanwhile, delivery platforms have provided displaced workers the possibility for extra income, and for their users the access to some goods and services otherwise restricted by the stricter lockdown stages. Already exposed to the dangers of theft and accidents, workers are now further at risk of COVID-19 infection as they go about their work. In response, some platforms have offered to cover the cost of disinfectant gel and face masks. Despite these new challenges, the new surge in demand has seen platforms saturated with new workers, many of whom are transfers from the formal economy. Myriam B / Shutterstock.com Iakov Filimonov / Shutterstock.com
Labour Standards in the Platform Economy | 13
The Legal Context
The legal position of gig work, the relationship between worker and
platform, and the inadequacy of current regulations is currently
the subject of debate among legal practitioners and political actors
in Chile. By blurring the distinction between independent and
subordinate work, gig work creates tensions with traditional legal
frameworks, and the legal system has been forced to question the
tools at its disposal.
Chile’s labor legislation is built around any legal challenges to the platforms’ organization. Due to the low monetary
a binary notion of employment, with position—with only one lawsuit by an value of the worker’s claims, this case
workers being classed as either Uber driver, which was rejected by has almost no possibility of review by
employees or independent contractors. a lower labor court. However, things the Supreme Court. Finally, Pedidos
The former are those who provide have changed after several worker Ya has been recently fined by the
personal services to an employer under organizations engaged in strikes and Labor Inspectorate after one of its
subordination and dependence (article campaigns, and especially given riders suffered an accident in the
3 (b) of the Chilean Labor Code). the market effects of the COVID-19 city of Puerto Montt.15 Since the fine
The legal concept of an employment pandemic. The Riders Unidos Ya presumes that the rider is an employee,
agreement (article 7)13 —developed organization presented two prominent
by decades of jurisprudence— lawsuits against PedidosYa, arguing
represents a dividing line for those that some members had been
who are protected under legislation. dismissed for organizing. These claims
Traditionally, subordination is the asked the courts to declare them
employee’s subjection to employer employees (and thus provide them
control, while dependence is related legal protections). Both cases are
to a person’s ability to provide for currently being litigated before labor
their own livelihood. A worker needs courts in Santiago.
to be subjected to both in order to
However, the first judicial decision
“Platform companies
be considered an employee. Courts
have developed a series of indices reclassifying a gig worker as an classify workers
(i.e., company uniform, clocking in, employee came in an apparently
disciplinary measures for company minor case decided by a labor court in as independent
the city of Concepción. In the judge’s
procedures) to assess complex cases.
However, they tend to work best with ruling, the conditions under which the contractors—as
“standard” forms of employment. services were performed amounted to
subordination and dependence; citing
in most countries
The legal system is thus struggling elements like the existence of shifts, where they operate—
to provide adequate solutions to the performance rankings, and the use of
debates mentioned above. Platform GPS, among others, to conclude that and have often
companies classify workers as subordination and dependence were
independent contractors—as in most present in the situation of the rider. On defended this
countries where they operate—and
have often defended this position
January 15, 2021, the Court of Appeals
of Concepción upheld the lower court’s
position both in
both in courts and public discourse.14 decision, agreeing with the original courts and public
Contractual arrangements reflect this, decision brief, particularly that the
sometimes explicitly in the Terms and criteria traditionally used by courts to discourse.”
Conditions. identify an employment relationship
does—and should be further adapted
Until 2020, there had been hardly to—address new forms of economic14 | Fairwork Chile Ratings 2021
the company has announced that it of the relationship between platform
will challenge the fine in the courts. and worker, however. This work is the
On May 17, 2021, a Labour Court in basis of an agreement reached by the
Santiago decided that a group of riders government and the senators in the
form Pedidos Ya were not employees Work and Pensions Committee, which
but independent contractors, citing led to the initial approval of a new
the lack of fixed working hours and version of the bill creating a hybrid
the existence of flexible agreements scheme distinguishing dependent
between the parties as reasons to and independent gig workers. It sets
reject the suggestion that they worked a series of rights for each category
under subordination and dependence. (in matters like working time and
This decision will probably be the data protection, among others) and
subject of an appeal. certain common rights in issues like
the right to organize and collective
The use of the existing legal provisions bargaining (without the full protection
to identify a gig worker as an employee afforded to other workers). This bill
raises the question: will new legislation was recently approved by the Senate
be required to regulate gig work? and is currently under discussion in the
Legislators have attempted to confront Chamber of Deputies. The government
these issues, and there are at least supports the bill, and it has used its
three major bills under discussion that constitutional power to give priority to
relate to specific labor problems. A its discussion.20
group of deputies have sought to create
a special regulation (bulletin Nº12475- Beyond labor law, a bill regulating
13) for gig workers within Chile’s Labor transportation services through
Code, recognizing them as employees, platforms (bulletin Nº 11934-15) is
thus applying the entire set of rights now in the final stages of the legislative
and protections afforded to employees, process. It creates a series of rights
and providing special norms for specific for users, and a regulatory framework
issues like working time and data on matters like vetting and registering
protection, among others. The bill was drivers and tariff settings.
approved by the Chamber of Deputies
and is now under discussion in the
Senate. Another labor reform package
presented in 2019 (bulletin Nº12618-
13) proposes to classify gig workers
as independent contractors while
recognizing certain rights in matters
like social security. Controversially, the
criteria used by the bill to establish the
independent nature of the relationship
could, in practice, turn the criteria
developed by courts on its head.16
Finally, another bill (bulletin Nº 13496-
13) looks to create protections for
gig workers, but does not address
the nature of the contractual
arrangements.17 This bill was
introduced by a group of senators in
may 2020, and it led to the creation
of a report, presented in October
2020, by a working group of senators,
government officials, and academics,18
which sketched a series of proposals
for matters like social security and
data protection, working time, and
other working conditions.19 They did
not reach an agreement on the natureLabour Standards in the Platform Economy | 15 Fairwork Scores Score (out of 10)* Cabify 2 Cornershop 2 Pedidos Ya 2 Uber 2 Uber Eats 2 Didi 1 Rappi 1 * The breakdown of scores for individual platforms can be seen at: www.fair.work/ratings
16 | Fairwork Chile Ratings 2021
All platforms in Chile for the year 2021 faced by delivery workers and drivers played by algorithms and the secrecy
score very low on Fairwork principles, in the performance of their work. surrounding their operation makes it
none of them achieving more than a difficult for workers to have concrete
2 out of 10 in the league table. These information on the existence of non-
results show that very few principles discriminatory policies.
of fairness could be evidenced in jobs
offered by digital platforms in Chile,
including access to a number of basic
rights and entitlements. Our results
highlight the very long way to go before Fair Contracts
a fair gig economy is seen in Chile.
As a general rule, the contracts or
terms and conditions drafted by the
companies were found to be easily
Fair Representation
accessible to workers, both in terms The principle of fair representation was
of terminology and language, even not achieved by any of the platforms
though certain clauses drafted in we analyzed. None of them was found
technical legal language. However, to recognize or facilitate the existence
Fair Pay with the exception of one company of workers’ organizations in order
(Cornershop), we could not find any to generate agreements and review
Through the evidence gathered, and instance in which platforms cannot existing working conditions. Although
because of the relatively high-cost unilaterally make changes to their there are associations of app drivers
base of most platforms, it could be terms, with differences regarding the (Acua Chile, for example) and delivery
evidenced that workers earn above manner of notifying and enforcing such drivers (Riders Unidos Ya Chile), they
the local minimum wage (in Chile, changes. Also, all agreements classify are not formally recognized by the
$326,500 pesos for a 45-hour work workers as independent contractors, platforms. This leaves gig workers in
week) before costs are considered. either through an explicit clause (which Chile without formal representation
However, none of the platforms were normally includes a statement denying mechanisms or instances to either
able to evidence that they pay a fair any type of regulation by labor law) cooperate with each other or to
wage after accounting for workers’ or through the general framing of the influence decisions that impact the
expenses, such as gasoline, and clauses drafted. process of work.
depreciation of the car, motorcycle or
bicycle.
Fair management
Fair conditions Only three out of a total of seven
platforms could be evidenced to
No platform was able to provide have clear communication channels
evidence of concrete and consistent with their workers, through the chat
policies aimed at protecting or other communication systems in
workers from any type of risk in the applications themselves. There
the performance of their activities. is no fluid and direct contact with
There are policies providing accident managers or executives and in most
insurance, although the seven of the platforms, once workers are
platforms we analyzed implemented deactivated from the platform, they
measures from the beginning of the cannot appeal a decision. No platform
pandemic (such as the provision of was found to have defined policies
masks and gel), only four were found to of equity towards its workers, which
provide some form of financial support would guarantee, for example, that
in cases where workers contracted the some workers are not benefited over
disease. We could not find evidence others, for example, when receiving
that these measures were consistent requests or orders. We could not
and broadly reached all workers. find any information on the use of
Greater and better efforts are required data and personal information of
in this area, consistent with the risks workers by the platforms. The roleLabour Standards in the Platform Economy | 17
Platform in Focus:
Cornershop 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
0
Fair Conditions
POINTS
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
Cornershop’s overall score 02
All platforms in the 2021 Chile league accepted through the app, Cornershop workers’ and (like other platforms)
table achieve a very low score, making offers its shoppers a fee-based does not allow for appeals in case of
it impossible to evidence any example agreement which they must sign in deactivation.
of best practice. Despite these person. As expected, Cornershop’s
limitations, we want to present here a contracts are built on the assumption
platform which, although achieving a that the shoppers are independent
score of only 2/10, has implemented contractors and state that labour
a number of working practices which law is not applicable. Unlike other
contain the seeds of a potentially fairer platforms, however, Cornershop
working model, bearing in mind that asks their shoppers to generate a fee
much more still needs to be done to slip in accordance with tax law. The
consider the work fair. Cornershop is contract, however, does not specify any
a Chilean digital platform (recently regulations regarding the company’s
acquired by Uber), which emerged in rates and payments. Cornershop pays
2015 in Santiago and Mexico City to its workers according to the deliveries
offer delivery services for supermarket they make through a payment method
shopping. that considers each product, its weight
and the distance traveled. Therefore,
For the Cornershop workers the larger the user’s order and the
interviewed, called “shoppers”, greater the delivery distance, the
the contract is accessible, simple, higher the earnings; with workers
written in clear language. While other usually earning above the minimum
companies operate through looser wage after costs. Its communication
agreements based on standardized channel is mostly focused on
terms and conditions that must be solving users’ problems rather than18 | Fairwork Chile Ratings 2021
Workers’ Stories
Raul* has a well-calibrated working routine. He and Uber did not offer a reimbursement. This
starts his shift as an Uber driver partner in the meant he had to stop working and later he had
morning, taking a snack with him. He returns to get into debt to buy another car to resume
Raúl home at noon to rest and have lunch. He keeps
several items in his car that make it easier for
his activities and provide for his family. On
weekends, his routine is a bit tougher, as he
Uber Driver him to stay out during the long day: a special extends into the night as long as curfew allows.
cover for his seat, a small trash can, and an He used to work all night, arriving home early in
air freshener he likes. After lunch, he rests the morning to sleep and rest during the day, to
for a while longer and goes back to drive until continue again at night.
curfew. Raul has been working for Uber almost
since it started operating in Chile. He has done He previously had other sporadic jobs, even
more than 10,000 trips and has an excellent working abroad for years. Here in Chile, Uber
rating (above 4.95), which he says has brought appeared to be a stable job opportunity. He
him benefits: “being an outstanding driver, I get does recognize certain risks, but he is willing
special attention. If I check into the offices, to to take them in order to have a steady income
consult something, they help me right away. I and ensure some stability when he decides
don’t have to wait in line.” to retire. He is zealous in his work and is not
interested in socializing or organizing with other
There are some factors beyond his control drivers regarding work issues. He prefers not to
that keep him permanently vigilant: he has be part of the WhatsApp or Facebook groups,
been involved in several traffic accidents; the and rather concentrates on his work.
inspectors have taken away his car a couple
of times; and he recently suffered an armed
robbery by two passengers, stealing his car and
*Names have leaving him in an abandoned spot. Although he
been changed to received help when his car was towed, he was
protect workers’ unable to do anything about the robbery: his
identities. private insurance does not cover a work vehicle
abriendomundo / Shutterstock.comLabour Standards in the Platform Economy | 19
Yenifer* is Venezuelan, with a technical and backups for herself and her coworkers.
education background. She lives with her She mentions that in some instances, it seems
husband, also Venezuelan, and their young son that the customers have greater credibility
Yenifer in downtown Santiago. Both work for Uber Eats, or priority than the workers do, which she
where they distribute their schedules so that shows with a personal story: “It was 1:30 in
Uber Eats
one can take care of their young son at home. the morning and I had an order of 4 km and at
Rider Because of this, they are comfortable working 1.5 km the tire went flat. They told me I had
for delivery platforms, and she considers two options: either cancel the order or make
them a good job opportunity: “Some take it the delivery on foot. I told him if I cancel it,
as a formal job, because that’s what they get, I will have a debt for the order. He told me
because of the schedule. There is no contract. that nothing was going to be charged and I
There is no obligation to work hours or location. canceled—two days later, they charged me for
Wherever you are, you connect.” When joining the order.” She also mentions that the payment
the platform, she didn’t check the terms and isn’t worth it for long distances in bicycle and
conditions thoroughly, but, as a migrant in there’s no way to know how far she has to ride
Chile, she didn’t have much choice and agreed before taking the order. If she cancels some of
to them because she needed to work. these long deliveries, she might suffer shadow
sanctions, losing visibility for orders via the
Both her and her husband have connected platform.
with other migrant workers who also live in
downtown Santiago. Together, they cycle to Sometimes the app assigns her very long
the eastern sector of the capital, where most distance orders, which are not financially
of the upper-income households live, and convenient; however, if she cancels orders,
where there is greater demand throughout even with a fair reason, her visibility on the
the day. The platform does not provide any platform decreases, as does her supply of
sort of protective gear for these long rides orders. These long distances are not easy,
besides the reflecting material in her backpack, so she ends up very tired and suffers from a
which she had to pay for. Riding in a group slight pain in her knee, possibly due to the
calms her down, especially on the way back at incessant pedaling. Despite bad experiences
night, when there is more risk of accidents or with the support system and not having some
possible assaults. She comments that she has insurances from the platform, she continues
had situations where a punctured tire has left to work, relying on her fellow countrymates to
her adrift at night, in the middle of an order, compensate for these drawbacks in her daily
so this group of acquaintances can also offer routine.
help. Besides these migrant networks, she
isn’t really involvedin any other workers group
or union, and she is not aware of any form of
organization recognized by the platform.
*Names have
been changed to While she is grateful for the economic
protect workers’ opportunity that allows her to work for Uber
identities. Eats, she would like to have more guarantees20 | Fairwork Chile Ratings 2021 Theme in Focus: The other front-line: COVID-19 and gig workers in Chile While workers face the risk of contracting COVID-19 in order to provide basic supplies to the rest of the population, platforms have failed to establish effective health or financial protection measures. The precariousness of gig workers, despite workers having become essential during periods of lockdown, has increased: Fairwork reports indicate that about half of gig workers worldwide have lost their jobs, and the remaining have lost two-thirds of their average income.21 Gig work presents a challenge to “inactive” threatens their scores, adequate protection. Since platforms social distancing. Gig workers have and consequently, their chances rely on safety items that can prevent direct contact with supermarket of receiving orders and generating contagion,24 conflict with workers has and restaurant staff as well as final income. Furthermore, for many, increased and many have begun to customers, and the risk of contracting especially migrants, this is a primary or appeal for their rights, bringing cases to the virus is thus extremely high. Many sole income, and they have no access court to reclassify them as employees. platforms have introduced preventive to any form of income protection. Although worsening economic measures, including contact-free In Chile, as in many other countries, conditions are of concern to platforms, delivery and guidelines on how to the pandemic has thus deepened they are a real threat to workers, who deliver to users, such as maintaining a existing inequalities, especially for bear most of the risks of the work. The distance of two meters, and washing women and migrants, who suffer asymmetry of risk between workers hands with alcohol gel. However, while greater vulnerabilities.23 Moreover, and the platform has been exacerbated the workers we spoke to reported that the economic recession, with the during the pandemic; it is therefore some platforms offered alcohol gel, associated loss of work and salary crucial that Chile’s government further they also reported that supplies often cuts, has forced migrant workers to regulates this market to guarantee gig quickly ran out. Others complained work more hours on the platforms, workers fair labor conditions and basic about recent policies for reimbursing especially given their uncertain (or protections. the costs of these safety items, such worse, undocumented) immigration as gloves, alcohol-gel, masks, but status, and lack of access to public platforms also stated this was optional health coverage, often due to fear of and disavowed any responsibility.22 being deported. Despite the risk, stopping taking Among the platforms operating in Chile, orders is not an option because being none of them could evidence to provide
Labour Standards in the Platform Economy | 21
Impact
and Next Steps
This report is the result of a one-year pilot We hope this report will generate
an opportunity to continue
project in Ecuador. We have established gathering information regarding the
characteristics of the gig economy
a baseline on the current situation of the in Chile, the working conditions of
those who make up this market, and
country’s platform economy that will let the possibility of imagining a fairer
us study its development and update our gig economy for all workers. A good
starting point would be to collect
ratings on an annual basis. As Fairwork’s official information from the country’s
platforms and institutions in order to
reach and visibility increases, we see four understand the size of this market and
the income generated by the thousands
avenues for contributing to improvements of workers that make it up.
in the conditions faced by Ecuadorian In the legal sphere, two initiatives
platform workers. will be of interest. On the judicial
front, current litigation in Santiago’s
labor courts could provide important
changes, considering the number
of workers and the issues involved,
including employment status,
dismissals, collective representation
and anti-union practices. It is
expected that these cases will reach
higher courts, providing more judicial
outcomes to follow. Whether courts
will follow the lead of the Court of
Appeals in Concepción is yet to be
seen. In the legislative field, the
main discussion revolves around the
preferred regulatory approach to the
status of gig workers. Senators and the
government are reported to be close
to an agreement on a hybrid scheme
that goes beyond the traditional
binary employment approach. This
Proyecto new category intends to balance
Fairwork the demands for both flexibility and
worker protection and may provide an
Tr rga
es adequate answer to the challenges we
o
r
ab ni
do have outlined in this report. We should,
aj zac
i
ad io
however, look at this with a guarded
um
or ne
n s optimism: there is a risk of creating
es s
Co a new set of less protected workers.
y
A new category for “second-class”
workers, may open the door to lowered
labor standards, and more precarity
and exploitation across different
Vías de cambio de Fairwork sectors.22 | Fairwork Chile 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)Labour Standards in the Platform Economy | 23
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
1024 | Fairwork Chile Ratings 2021
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 2.1 – Mitigates task-
Threshold 1.1 – Pays at least
costs, or there is a policy which
the local minimum wage (one specific risks (one point)
requires payment above this level.
point) There are policies to protect workers
The threshold for the minimum wage
Irrespective of the employment status from risks that arise from the processes
plus costs varies between different
of the worker, workers earn at least of work.
kinds of platform work. In order to
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.30 For 2.1, this means
The threshold for 1.1 is based on the
interviews.29 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).25 Workers on the platform must
earn more than the minimum wage rate vehicle is used, or there is interaction
• A policy that guarantees workers
in their working time,26 and this can be with customers. The specific practices
earn at least the local minimum
evidenced by either: leading to the awarding of this point
wage plus costs; or
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 in their working To be awarded a point for 2.1, the
minimum wage plus costs.
time; or platform must demonstrate that:
If the platform has completed Table 2,
• The provision of summary • There are policies or practices in
the mean weekly earnings minus the
statistics of transaction data. place that protect workers’ health
estimated work-related costs must be
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.28You can also read
