Labor warned that gig worker laws will drive up NDIS costs

Financial Review, 26th July 2023

Workplace Relations Minister Tony Burke has signalled that the government’s forthcoming gig economy laws will extend to carer apps such as Mable, despite exemptions for similar marketplace platforms such as Airtasker.

Mable co-founder and executive director Peter Scutt, who is surprised at the move, has warned that the government’s minimum conditions for the app’s 15,000 independent contractors will drive up costs for the National Disability Insurance Scheme and cause workers to quit the platform.

Mr Burke had previously flagged that the laws were intended to cover on-demand ridesharing or delivery apps such as Uber but had drawn a distinction with marketplace apps where workers set their own rates for tasks.

Mr Scutt said the care and support economy could not afford to be covered by the government’s new laws.

“We are perplexed by what appears to be the government’s current policy position of extending employee-like reforms that were initially intended to target gig platforms in rideshare and food delivery and extending them to two-sided marketplace platforms,” he said.

“Employee-like reforms have the potential to have perverse and unintended consequences for the care and support economy, including increasing friction and cost, which will be borne by care recipients and taxpayers, reducing workforce participation [and] undermining the role of digital platforms in enabling productivity gains.”

The potential coverage comes as the aged care sector suffers worker shortages and after the government introduced requirements for at least 200 minutes of total care per day per patient.

Cost blowout
Projected spending for the NDIS has blown out by $13.1 billion over the past year and Treasury warns that the costs will increase by another $17.2 billion over the next four years.

Mable’s argument is that it’s a marketplace app because, unlike Uber, it does not set rates, and carers determine their own pay with clients. Like Airtasker, it already has a wage floor in place.

However, during an event at The Sydney Institute on Monday night, Mr Burke cited Mable as an example of a gig worker app where workers did not have power.

“Think of the different platforms you use when you’re doing rideshare, when you’re getting food delivered to your house, or if you have any interface with the NDIS or the aged care system – there’s a platform called Mable which people are often on,” he said.

“It’s where people are very much employed and not having high degrees of power through those apps when I talk about the gig economy. I’m not talking about places like Airtasker where it effectively runs as though it’s the trading post, but a digital form.”

He said the rates of pay for workers on those platforms were “frequently below what the award rate would be”.

Health Services Union NSW secretary Gerard Hayes, who has been pushing for the government’s gig laws to cover Mable, said “we’ve got issues with apps like Mable in aged care”.

“We see aged care should be a direct employment relationship so we’re certainly not supportive of that [independent contractor arrangement] for long-term care,” he said.

“They [Mable] take their cut but what responsibility do they have for the people they’re interfacing? We see there should be total responsibility and accountability for employers for delivering a service, not just for a group that introduces people and takes a cut.”

Mr Scutt said the government had “indicated it intends to capture care and
support platforms like Mable but possibly not Airtasker, but it is not clear why or how that will be achieved through legislation”.

He said workers in the sector had a choice to be employees or contractors and disagreed that Mable’s workers lacked control over their work or had less bargaining power or freedom to set their own prices.

“This is evidenced by the high average hourly rates, which have been increasing year over year by almost 10 per cent,” he said.

“If an individual determines their services and rates, and enters into a contract with their client, which they negotiate and set the terms of that engagement, then there should be no question that person is not ‘employee-like’.”

Mable has a minimum rate of $36, based on casual rates, the national minimum wage and superannuation, which ensures users get $32.40 an hour after platform fees.

As of May, its platform reported average rates for personal carers of $50 an hour, $48 an hour for social support and domestic assistance, and $58 an hour for nursing.

Currently, Mable delivers services for more than 20,000 older people and those with disabilities and Mr Scutt said the app had the advantage of lowering overheads, enabling taxpayers to pay less and workers to earn more than comparable awards.

He said the gig reforms would cause independent contractors and their clients to “move off platforms, negating the intended benefit of the reforms, while reducing transparency, safeguards and workforce visibility”.