Skip to content
Structural barriers to the digital platform economy for forcibly displaced workers
  • Kathryn McDonald
  • May 2024

Regulatory vacuums contribute to the structural exclusion of forcibly displaced populations seeking work on digital labour platforms. Even where these issues can be overcome, questions remain as to the viability of these platforms as a path to economic empowerment.

Participant at a digital training class in Kenya. Credit:
Participant at a digital training class in Kenya. Credit: UNHCR/Charity Nzomo

Digital labour platforms have become increasingly prominent in the global labour market over the last decade. There are now over 700 unique digital labour platforms (DLPs), providing opportunities to an estimated 50 to 150 million workers globally.

DLPs are characterised by a low barrier to entry, directly connecting clients in need of services with workers able to provide them, and organising work on a casual, piece-rate and temporary basis. This format can present opportunities for workers unable to secure stable, long-term employment.

Around the world, governments are embracing digital labour as part of an economic development strategy, focusing on its potential to bolster growth and featuring DLPs in their development plans and policy frameworks. Increasingly, such plans include forcibly displaced populations as groups that could benefit from the expansion of platform-based work. This has resulted in the convergence of development and humanitarian infrastructures, with actors like the UN, World Bank and Rockefeller Foundation promoting DLPs to displaced populations to ease economic strain on host economies and humanitarian support systems, and allow refugees to earn a living, integrate into host countries’ economies and promote self-reliance.

Initiatives to integrate displaced people into the digital economy are a response to the constraints these populations face in accessing employment and income-generating opportunities. Though the right to work for refugees is established in the 1951 Refugee Convention and the Economic Covenant (ICESCR), in practice many host countries limit this right. Exclusion from certain industries, discriminatory practices, requirements around work permits, and policies restricting mobility keep refugees from attaining employment. Refugees in camp settings are further constrained by geography and limited resources. Amidst persistent labour market challenges, DLPs offer possibilities for economic inclusion for displaced people who face structural and practical barriers to exercising their right to work.

However, this model may be unsustainable – DLPs are associated with non-standard, informal and unregulated forms of work with persistent decent work deficits. DLPs may exacerbate existing social inequality and economic divides, compounding market frictions that result in inferior outcomes for already disadvantaged groups. Critics warn that although these platforms can provide opportunities, they do so by tapping into a “readily available supply of migrant labor to service market demand, […] extracting surplus value by keeping labor costs low and providing minimal labor protections.”

Issues related to 1) access and infrastructure and 2) status and rights, form the greatest structural challenges impacting workers in the platform economy. This article will address how these challenges create risks for forcibly displaced people engaging in platform work, highlight existing initiatives addressing these barriers, and propose good practices for practitioners working with displaced populations in the platform economy.

The challenges related to working on DLPs are intersectional. If DLPs are to benefit displaced people, it is essential to address their implications on issues like job quality, economic integration and livelihoods. Understanding the nature of these challenges can help advocates and organisations better serve these groups and facilitate their access to digitally-mediated opportunities.

Access and infrastructure

The most prevalent barriers affecting forcibly displaced people in the digital economy are linked to exclusionary requirements around formal identity recognition, which create challenges around access to financial services, digital connectivity and tools of work.

To access work on DLPs, platforms typically require workers to verify their identities by providing government-issued documentation. But in many cases, forcibly displaced people may not have access to credentials like national ID cards and passports. It is common for forcibly displaced people to lack such documents either because they never had them or because they were lost, seized or destroyed during displacement. Additionally, workers from countries subject to sanctions may be barred from accessing DLPs, and in cases like Syria, this can exclude millions from the platform economy.

Refugee ID cards, provided upon registration in host states, often do not enable the same levels of access to work and services as standard ID cards and are typically temporary. Some platform workers have had their platform accounts frozen after their IDs expired.

Identity documentation is also a precondition for accessing financial infrastructures, necessary for engaging in platform work. Both formal banks and mobile money programmes require identification documents to open accounts. This is important because platform workers will need a verified financial account to receive payments from platforms. Half of the global refugee population live in host countries that restrict their access to bank accounts, thereby imposing barriers to livelihood opportunities.

Documentation issues also pose barriers to workers’ abilities to access digital infrastructures. SIM card registration yields unique access challenges for displaced populations. Increasingly, governments are imposing regulations requiring that users provide legal IDs to purchase SIM cards. In 2021, 157 countries had enacted mandatory SIM registration regulations and refugees have identified ID requirements as being a significant barrier to digital connectivity.

Initiatives aimed at improving access to digital labour platforms

Within the humanitarian-development-platform nexus, we find examples of practices and programmes attempting to mitigate access-related challenges by helping workers navigate barriers to entry and providing infrastructure. Some platforms have built lower-tech ways for workers to access platforms, involving cash exchanges and face-to-face registration for platforms. While these measures provide ways around barriers to inclusion, they are not durable solutions and may limit long-term growth and the ability to operate at scale.

The cost of digital tools like laptops and smartphones is another significant barrier for refugees in the digital economy. Some refugee-focused programmes attempt to mitigate these barriers by facilitating access to platform work opportunities and providing infrastructure. For example, the Refugee Employment and Skills Initiative (RESI), a programme funded through the Norwegian Refugee Council and the International Trade Centre was established in 1997 and began offering services in 1998, operating out of Dadaab and Kakuma camps in Kenya. RESI provides programme participants with laptops, high-speed internet and co-working spaces, as well as digital skills training regarding online work. RESI has also negotiated agreements directly with DLPs, resulting in their accepting alien ID cards, commonly used by refugees, for platform registration. These negotiations enabled 250 programme participants across both camps to begin working on platforms, though they did not address the eventual expiration of these documents. Staff have noted larger barriers related to the continuation of programme funding, the willingness of participants to assume the risks associated with platform work and the ability of workers to continue work independent of the programme’s support.

These issues highlight the need for coordination and dialogue between platforms, governments and development actors to create policies that reflect the experiences of displaced people and the constraints of refugee assistance infrastructures. Policies that facilitate uninterrupted access to services for FDPs will enable them to effectively engage in income-earning opportunities in the platform economy.

Status and rights

Currently, digital labour platform work is poorly integrated into existing social institutions and regulatory frameworks, leaving workers without adequate coverage vis-a-vis employment standards, social benefits and workers’ rights legislation. This is largely because platforms categorise workers as ‘self-employed,’ ‘contractors’ or ‘entrepreneurs,’ which has implications for the effectuation of basic rights. Whether platform workers are truly self-employed is a question of extensive debate.

Most jurisdictions extend labour and employment-related rights only to formal employees. When platform workers are treated as self-employed, they experience decent work deficits and an absence of many fundamental rights at work, such as stability and security of work, equal opportunity and treatment, safe work environments, social security and the right to organise and collectively bargain.

The complexity of these issues is compounded for displaced people who may face legal exclusion and discrimination in host countries, presenting additional challenges to effectuating their rights in the platform economy. UNHCR reports that 70% of refugees live in countries that restrict their right to work.

The lack of clarity around platform workers’ employment status and rights has been argued to both benefit and constrain forcibly displaced people. The regulatory vacuum may actually extend opportunities to displaced people because, if they cannot obtain work permits in host countries, they can slip into the informal and unregulated platform economy. Some platforms have actively lobbied against regulation and formalisation on the grounds that the “reclassification of platform labour as employment would make it more difficult, and in some cases impossible, for refugees to access this type of work.”

On the other hand, advocates warn of the perils of this approach and its impacts on vulnerable workers. Where access to decent, formal work arrangements is limited, forcibly displaced people are more likely to accept informal, precarious and hazardous arrangements to support themselves and their families. Informal workers are more vulnerable to shocks like medical emergencies, economic downturns and market fluctuations.

In the absence of systematic regulation, DLPs use Terms of Service agreements with workers to govern working conditions. Platforms retain the right to deactivate and otherwise penalise workers’ accounts at will, offering few mechanisms to contest these decisions. The threat of deactivation and the opaque nature of platform management creates a power imbalance. This leaves workers guessing how to best navigate platforms and frequently compels them to accept unfair or unsafe conditions. Consequently, decent work deficits are prevalent in the platform economy and risks for platform workers are exacerbated by the absence of statutory protections which ensure their fundamental rights.

Initiatives to promote decent work in the digital platform economy

The question of how to promote decent work in the platform economy is a subject of ongoing debate amongst stakeholders. There have largely been two approaches: formalising platform work, and voluntary regulation and social impact enterprises.

Some jurisdictions use novel classification structures to regulate work that is not easily categorised as employment or entrepreneurship. In the United Kingdom, the union for professional drivers, the GMB, successfully pursued reclassification claims on behalf of 30,000 platform-based drivers, arguing the group rightfully belong to UK labour law’s ‘worker’ category. Gaining this designation gave these drivers access to basic employment provisions (e.g. minimum wage, guaranteed breaks and holiday pay).

However, this category does not confer protection against unjust dismissal or guarantee the right to work, presenting further risks to workers. Over 66 arrests and ten deportations have been reported in the UK of platform-based drivers who were ‘found to be working illegally.’ While platforms claimed to vet each driver with regard to their right to work, these workers were still placed in a precarious situation due to the legal ambiguity that surrounds platform work.

When it comes to formalisation, rather than relying on legal loopholes to include displaced workers, interventions should focus on integrating DLPs into regulations that provide all workers, including refugees, with fundamental rights. This approach has the potential to formalise platform work, and facilitate legal, social and economic integration for forcibly displaced people if regulations are enforced.

Voluntary measures, undertaken by individual firms, have also addressed status-related issues and decent work deficits in the platform economy. Specifically, some platforms have developed business models that improve pay, work-life balance, skills development and the power imbalance between platform operators and workers. These ‘social impact platforms’ aim to provide better conditions regardless of employment status, with many specifically targeting displaced and otherwise marginalised workers.

An example of such a platform is ‘Digital Lions’ – a World Fair Trade Organization-verified ‘fair trade digital agency’ offering web development, graphic design and video and animation services. They promote ‘sustainable jobs’ by implementing decent work standards like fair pay, non-discrimination, gender equity and good working conditions, and explicitly aim to employ workers from underserved communities.

Another socially-minded platform, Humans In The Loop, engages with displaced communities in Türkiye, Iraq and Syria, for work like annotation and AI data training. In 2019, they contracted 167 workers. They are notable for their explicit aim to provide fair working conditions. Humans in the Loop has used its experience in supporting workers with refugee backgrounds to develop a Fair Work Policy that could be adapted by other platforms. Some of their commitments to workers include paid training, wage levels at or above national standards and opt-in health and accident insurance.

Conclusion

Research demonstrates that DLPs present both opportunities and risks for workers, and that for forcibly displaced people, existing risks can be exacerbated. Harnessing the potential of platform technologies requires robust policy solutions around access and status-related challenges, and the development of programming and resources aimed at building workers’ capacity to effectively navigate online labour markets.

Humanitarian and development organisations operating in the platform space have typically focused on issues of inclusion and mitigating barriers to entry for displaced workers. Structural barriers, precarious working conditions and a lack of protections have been more difficult to address because these organisations lack the power to shape policy and influence stakeholders.

If this form of work is to be part of the solution to the economic inclusion of displaced populations, it is critical to promote an enabling environment to support the effective realisation of workers’ rights. Ensuring that platforms offer decent work opportunities requires that all workers, including forcibly displaced ones, have and can exercise their fundamental rights irrespective of their refugee status or employment classification.

Regulation, formalisation and social dialogue are possible and critical, but will only be effective if forcibly displaced people are actively involved and if policies are designed to reflect the barriers they face and plug the structural gaps that deepen their vulnerability in the gig economy.

 

Kathryn MacDonald
Independent consultant
kthryn.mcdnld@gmail.com

READ THE FULL ISSUE
DONATESUBSCRIBE
This site is registered on wpml.org as a development site. Switch to a production site key to remove this banner.