Flexible Work: A Law and Economics Perspective

Both casual and gig-based work arrangements have been subject to unprecedented levels of attention recently. This is mainly due to the widely-reported usage by many well-known corporate employers of controversial ‘zero-hours’ work contracts, the recent spate of well-publicised tribunal and court decisions on alleged employer exploitation of gig economy workers in cases such as Uber and Deliveroo, and also the publication in 2017 of the high-profile Taylor Review and subsequent House of Commons Committees’ Report into modern UK employment practices. While these developments and issues are likely to be subject to extensive analysis by employment lawyers, they remain relatively underexplored from other pertinent legal and inter-disciplinary angles. Accordingly, this paper will adopt an alternative perspective on flexible work inspired by the economic analysis of law and, in particular, the Coasean theory of the firm. Focussing on the implications of casual and gig-based work for the allocation of authority, risk, profit and decision-making rights within the firm, it will present a normative case for worker ownership as the reciprocal counterpart to flexible workers’ residual risk-bearing function. On this basis, it will critically assess key aspects of the current legal framework and policy agenda for the protection/empowerment of flexible workers in the UK.