Worker-Owned Apps Are Trying to Fix the Gig Economy's Exploitation
A network of cooperative alternatives are replacing rampant exploitation with decent work.
by Ryan Hayes
Nov 19 2019, 1:00pm
Still from Mensakas YouTube video for its fundraising campaign. Image: RidersXDerechos BCN/YouTube
The billionaires who own the app-based gig economy have an insatiable appetite for precarious labor. Meanwhile, the millions of workers who power these platforms are hungry for food and basic necessities. They rely on gig work for survival, assuming major risks for little pay and scarcely any benefits.
Instacart unilaterally cut workers’ pay by halving the default tip to 5 percent per order, provoking a three-day strike from November 3-5. Two days after the strike, the company responded by cancelling “quality bonuses” that can represent up to 40 percent of workers’ earnings. Instacart’s open hostility towards its own workforce is the most recent case for adding a dose of economic democracy to the private sector.
What would happen if low-wage workers came together to cut out the middleman and build their own platforms? This isn’t just a thought experiment. Worker-owned apps are already providing real alternatives to dismal working conditions in the global gig economy.
Up & Go is a home cleaning app owned by workers in New York City. “On other apps, the owners set your wages, but we set our own wages,” said worker-owner Esmeralda Flores.
Up & Go cleaners earn $25 per hour, more than double what workers typically earned independently, according to Project Manager Sylvia Morse. While apps generally take a cut of 20 percent or more, Up & Go only takes 5 percent, which it then reinvests in the platform.
The cleaners, primarily immigrant women from Latin America, cooperatively own the Up & Go code and brand, launched publicly in May 2017. They meet monthly to make decisions on topics like cancellation policies and pricing.
“If you look at other platforms, it’s clear they artificially lower prices by subsidizing first-time users and paying as little as possible to their workers. Our value proposition is that our prices are transparent, workers earn a fair wage, and clients receive professional-quality cleaning,” said Maru Bautista.
Bautista directs the Cooperative Development Program of the Center for Family Life in Brooklyn. Over the past 13 years, the Center has formed 20 worker-owned co-ops that have generated more than $13 million in revenue.
The development of Up & Go was guided by three immigrant-led cleaning co-ops over a year-long process of co-design and testing, made possible in part by funding from the anti-poverty Robin Hood Foundation.
Moving from extractive to cooperative platforms
Up & Go is one example of the emerging “platform cooperativism” movement. These new projects, sometimes called “platform cooperatives,” are tech enterprises owned and democratically controlled by their workers.
Danny Spitzberg, a user experience researcher who helped develop Up & Go, told Motherboard that “to get a project like this off the ground, it helps to see platforms as digital equipment rather than things with a life of their own.” In the case of Up & Go, the platform built on an existing cooperative organizing model and many years of building relationships.
Spitzberg says that the movement is essentially about “workers figuring out how to streamline workflows and keep the benefits themselves.” Before Up & Go existed, the cleaners spent one to two days every week advertising their services to secure new clients. As more cleaning jobs shifted online, Up & Go provided cleaners with a platform to thrive in the online economy while also developing new skills as owners.
“Look at how Instacart’s recent pay cuts has hundreds of customers boycotting, shoppers striking, and others going on Twitter to demand improvements from the CEO, who is remaining silent so far. If the investors feel the pressure or have the foresight, they could meet the demands for better pay and see the collective action as an opportunity to build a better, member-owned business,” said Spitzberg, who advises for a shared ownership accelerator program called Start.coop.
Professor Trebor Scholz of the New School estimates that there are currently 400 projects under the platform cooperativism banner. A recent conference he helped organize in New York City brought together 150 speakers from 30 different countries.
Their shared goal is to create “concrete alternatives” for workers “who are not protected, and actually assaulted by deteriorating labour rights that were hardly there in the first place,” said Scholz.
Oriol Alfambra and Nuria Soto, two former Deliveroo food couriers from Barcelona, attended the conference to share Mensakas, a worker-owned delivery app. Alfambra and Soto started Mensakas in 2018 with other couriers who were fired during a union organizing campaign. They launched their app with the support of a crowd-funding campaign and government grant.
“Companies try to sell precarious work like it’s something cool,” said Soto in her presentation, referring to Deliveroo’s “be your own boss” hiring pitch. Now, she and her fellow gig workers are trying to one-up Deliveroo by making the slogan a reality: Mensakas is self-managed by its workers, who have employment contracts rather than being misclassified as independent contractors.
Mensakas is also allied with CoopCycle, a European federation of bike delivery co-ops in 16 cities, who are pooling their resources to develop shared software and coordinate advocacy efforts. Alexandre Segura, a self-taught web developer, created CoopCycle in 2016 after connecting with French couriers who lost their jobs when Belgium-based start-up Take Eat Easy declared bankruptcy.
“I’m not a rider myself, I hardly know how to ride a bicycle. But we as developers have a kind of responsibility in the world today. Platforms affect the lives of so many people,” said Segura. “Most of our cooperatives are still small, but we’re providing consumers with a credible alternative.”
Barriers to building a digital economy we own
Eva launched in May in Montreal with financial support from Desjardins, Canada’s largest credit union. It’s like Uber, but aimed at people who want to support a local business. The platform has 500 active drivers, with 500 more in the process of joining, and a growing base of 17,000 users, according to co-founder Dardan Isufi.
Isufi spoke to Motherboard while preparing for the co-op’s upcoming annual general meeting. “We have to send out 18,000 invitations. Of course, we don’t expect them all to physically show up, but they’re our members.”
Under Eva’s governing rules, both drivers and riders have voting rights, and receive a share of profits, though turning a profit is still unheard of in the ride-sharing business, including for heavyweights Uber and Lyft.
“I like that we can vote on how much of our fares go to the head office,” said Eva driver Imran Karmali, who will be attending his first meeting. Drivers currently contribute 15 percent of their fares towards the fledgling company’s marketing and operating costs, while Uber takes 25 percent.
Isufi began working on Eva two years ago with fellow university student Raphael Gaudreault. He remembers asking Gauldreault, “How hard could it be to start a better ride-sharing platform?” In practice, there’s been no shortage of challenges, like a period of sleepless days and nights rooting out fraudulent activity and creating new protocols.
Mike Calomoris started driving for Uber in 2018 to supplement his income as a wedding photographer. He joined Eva when they launched and now drives exclusively for the app. Like with Uber, Eva drivers are classified as independent contractors, meaning that they are not entitled to employment standards like minimum wage.
However, Calomoris is part of a test group of 15 Eva drivers who receive a base wage of $13-15 per hour (minimum wage in the province is $12.50) in exchange for working a set number of hours in high-demand areas. If drivers make less in fares than the guarantee, Eva pays the difference. If drivers make more, they keep the full amount.
In October, Eva started a pilot project with the Montreal airport and saw its ridership increase by 40 percent. “We had a big parking space for Eva drivers, our own doors, and an information booth inside,” said Isufi.
According to Isufi, airport management gave Eva staff the impression that they were happy with the partnership as well. But 24 hours before the renewal date, the airport informed Eva that they could no longer advertise inside, citing a new exclusivity agreement with a larger company, according to Isufi.
Isufi is disappointed that Eva was not given an opportunity to stay. “As a local and social alternative in the start-up phase, losing our presence inside the airport has a very heavy impact on our development.”
“I’ll be honest, we’re not a multi-billion dollar company,” said Isufi. “But in 2019, why would you work so hard to build equity for someone else, especially a large multinational corporation?”
In line with their cooperative business model, the code for the app is being made available to other local co-ops around the world. The first “social franchise” to register is a drivers’ cooperative in Dhaka, Bangladesh.
Designing apps with workers in mind
Members and supporters of cooperative platforms want to create software and businesses that are fundamentally different from the apps like Uber, Lyft, and DoorDash that currently dominate the market.
“We don’t want to create a poor copy of extractive platforms,” said Jutta Treviranus, Director of the Inclusive Design Research Centre at OCAD University in Toronto. “First of all, we don’t have the money they do. Our measure of success is how far we explore the difficult terrain that extractive platforms ignore.”
Treviranus and her team received a grant from Google.org to co-design open source tools with platform co-ops that will grow the cooperative digital economy. “If you plan only for the majority, your system becomes quite brittle and reaches end of life quickly, because there’s so much you haven’t anticipated,” she explained.
What would an app look like that centers women’s safety instead of making it an afterthought? Members of the Self-Employed Women’s Association in India are exploring various solutions to this challenge for beauty workers who make home visits such as panic buttons, an anonymous tip line, and doing away with individual worker profiles.
Salonie Hiriyur, Senior Associate with SEWA's 300,000 member Cooperative Federation, stressed that the co-op model itself adds a layer of safety. "There is an awareness that the worker is backed by a collective. This awareness protects the worker against harassment."
In New York City, Up & Go decided against including individual worker profiles on their app. According to Project Manager Sylvia Morse, the worker-owners were firm that “We’re selling our services, not ourselves.”
“The reason for these profiles is a proxy for trust-building on huge anonymous platforms. But co-ops have a competitive advantage because they are the owners,” Morse told Motherboard. “When someone comes to your home, it’s not a gig for them, it’s an investment in their business.”