Regardless of genre, the battle between the two biggest heavyweights in the on-demand world is constantly being played out before us in the nationals, trade and broadcast media. But anyone thinking that the so-called ‘gig economy’ is the preserve of fast-food and taxi cab businesses are wrong. Very, very wrong.
The gig economy, that which sees an increasing reliance on contract workers rather than permanently employed staff, is set to transform the legal sector sooner than many of us think. But are you ready for it?
Uber is the perfect manifestation of what we mean by the gig economy. With over 30,000 drivers in the UK and valued at over $62 billion, Uber’s hook is that it provides opportunities for independent drivers to work flexibly when they want, with the tagline Work for yourself, drive when you want, make the money you need.
Of course, the business model it operates under has opened up the debate over whether Uber drivers are classified as an employee, worker or self-employed. This has seen a number of protests from Uber and Deliveroo workers over the last few months seeking greater clarification over their correct legal status – the distinction being critical in determining tax liability, statutory sick pay and paid annual leave to name just a few of the rights being questioned.
Both Uber and Deliveroo have become the poster boys of an increased trend – nationally and globally – towards greater flexibility in the workplace. Although the gig economy has its roots in the hospitality and services sectors, its influence is spreading across all industries at a rate of knots, including law.
PwC’s The Future of Work report forecasts that by 2020 around 1 in 5 workers in the UK will be so-called ‘gig workers’. These figures are rather tame when compared to those from the leading trade body the for the UK recruitment sector.
Indeed, the Recruitment & Employment Confederation (REC) suggests that as many as 1 in 3 of us will be opting to work in this way by 2021. It cites figures from research group The McKinsey Global Institute that predicts the gig economy will be worth an expected £45 billion to the UK economy by 2025.
Whichever set of predictions you choose to follow, the consensus is that the gig economy is not a passing fad. Rather, its influence in the way law firms recruit and retain staff will be clear for all to see, if it isn’t already. Let’s look at the numbers.
Recent figures from The Law Society state that there are around 370,000 people employed in the UK – a rise of 8% from 2014-2015. 63% of these positions are solicitors. Growth in the legal sector has averaged at 3.3% each year since 2005 compared to just 1.2% for the UK economy as a whole.
At this rate, the sector will see an additional 29,000 or more new entrants each year for the foreseeable future. So if we fast forward to 2020-2021, of the 29,000 new people joining the legal sector each year around 6,000 of these workers will be gig workers – or portfolio careerists – according to PwC, or 9,600 if we take the REC’s predictions into account.
Against this backdrop, it is surprising to learn that less than one-third of legal employers have a strategy in place to enable their law firms to adapt and accommodate the rise of the gig and portfolio career worker. Why?
Like with many advances, organisations adopt a wait-and-see approach to see if all the predictions presented will actually come to fruition or remain as hyperbole. But regardless of whether law firms are sceptical about the changes that lie ahead (and they will happen), they should be embraced and not feared.
The ‘gig economy’ may still be in its infancy, but there are two distinct demographics that are leading the charge.
First are the ‘millennials’(sometimes referred to as ‘Generation Y’) – those who are currently aged between 20-35, and born between 1982 and approximately 20 years thereafter. They typically want to have greater control over their careers and are expected to make up around three-quarters of all workers by 2030.
Then there are those with a few more years under their belts, the Generation X’ers who were born sometime between 1965 and 1984. They also want more flexibility but they are increasingly seeking greater variety in the work they are doing, opting instead to combine their main career with a number of often-diverse roles.
With demand for gig working growing apace so will the value law firms attribute to it and the greater their understanding of the challenges (and opportunities) presented by this way of working.
One such challenge will be the way law firms manage quality control. Employers will need to ensure that contracts are allocated to the best person for the job and not the one who offered the cheapest rate.
Indeed, with many skilled positions being outsourced to gig workers there is a job to be done to make external workers feel part of the internal team, and vice versa. Failure to do so could see an increase in silos which in turn could see the talent pool become much smaller; thereby, creating an ‘us and them’ corporate culture.
There will likely be changes in work patterns too. Law firms will be required to become more agile and turn many of their preconceptions of how employees work on their heads. Contingency workers are typically recruited to plug short-term gaps in the workforce, but this is likely to change. Workers at both ends of the skills spectrum will increasingly expect to be able to work flexibly and as it stands right now, law firms overall are less geared for such flexibility.
The issue over pay is another key consideration. Law firms will need to clarify the legal and tax status of gig workers to ensure they receive the same protections (and benefits) as other self-employed workers so as to avoid protests like we have seen this summer from Deliveroo and Uber workers. Not forgetting the way that the firm itself will be perceived by clients who will be engaged with a firm whose teams are made up of both permanent and gig workers.
Managing a team of permanent and flexible workers will be a challenge, but so too is the ability too ensure continuity of service throughout the customer journey.
Contract lawyering will certainly be a marked shift away from what we have been familiar with and all of us have a simply choice to make – Are we onboard with the change or not?
With the downward pressure on pricing showing no signs of abating, the ‘gig economy’ is a good fit for the legal sector. Those practitioners with the skills, experience and proven know-how will be in demand and available to be called upon on demand for whatever length of time they are required.
Gig working will not be the death knell of legal practice as we know it. Rather, it will enable law firms to become more flexible, less rigid and utilize a workforce that can be quickly scaled up or down according to the needs of the business. It will take some getting used to, but we’re in an increasingly competitive sector and embracing the gig economy could prove invaluable for practitioners under increasing pressure to reduce their costs while maintaining a high standard of service to their clients.