Who runs the market?
GoodFlexi fits the secure software-as-a-service model. It will be hosted remotely; sparing costs and upkeep of a stand-alone implementation. On day one you will be given a virgin market with one Superuser log-in. That person can register infinite back office users with different levels of access.
From that point on, back office users can:
- Approve intermediaries: These are the organizations who vet, insure and support employers/workers who they accept as customers. They charge their buyers and payroll their sellers, retaining a margin on each hour sold. Intermediaries might be commercial temp agencies, employment charities or public bodies. They can’t enter the market without back office approval.
- Oversee intermediaries: Back office access allows the user to see – and override if necessary – the activity of any intermediary. This is the norm for such systems. The market operator may wish to intervene if an intermediary is breaking their contract permitting use of the market.
- Set defaults: Default maximum/minimum; travel areas, periods of notice, session lengths and other personal choices for a worker can be updated anytime. There is rarely a legal aspect; just local judgement on how to best ensure new workers get a good flow of work without being plunged into brutal on-demand assignments if that is not their wish.
- Change system controls: Minimum wage settings and bands, maximum working hours, minimum breaks, age restricted hours and many other parameters can only be changed by back office users with the highest level of clearance.
So, who are the back office users? Options include:
- The local workforce system: Staff already shape their jobs market, usually within local political priorities. The same values/protections could simply be extended into ultra-flexible work with a small cadre of managers given back office log-ins and routines established for approving an intermediary or monitoring existing activity.
- A workers’ organization: Unions run hiring halls, GoodFlexi is a more granular 21st century version. Community development bodies often evolve sophisticated labor market support strategies transferable to granular work. We, Beyond Jobs, have experience of running UK markets with no ideological aim beyond growth and personalized opportunity.
- Commercial operators: This may require a contract that stops market manipulation to unfairly increase profitability.
Your market operators will decide how the local market is to be shaped. Key issues include:
- Worker status: Are people selling their time in the system allowed to do so only as hour-by-hour employees of a temp agency (so called “W-2’s”). Or, will it also accommodate independent contractors (“1099’s”)? GoodFlexi can lessen the isolation of independent contractors by ensuring they are affiliated with a chamber of commerce or other body providing protection/benefits.
- System wage floor: Compliance with minimum wage legislation on every booking is a given. But there may be a local Living Wage. Is that the floor? Balance needs to be found between boosting income and need to compete with cash-in-hand bookings.
Who are the intermediaries?
If your workers are to be W-2’s they will each need an employer-of-record. That intermediary vets each person then payrolls them in return for a mark-up the body sets on each hour booked. Whoever runs the market needs to set standards for these organizations. Equilibrium needs to be found between: (a) ensuring stability for market participants (b) getting a vibrant, innovative, competitive field of bodies driving the market forwards.
The aim is simply to create a transparent market that’s fair to everyone. Further issues may be decided in conjunction with intermediaries. These parameters are then inserted into the system’s default contracts.
Rule setting for beginners
Market operators’ power in setting rules is in proportion to the early demand lined up for local launch. If a city commits $20m of bookings over the first 12 months, that is a huge block of demand creating a mouth-watering business case for intermediaries. They can likely be pushed into accepting enhanced conditions for workers and lower mark-ups. If a launch is only just above minimum demand, intermediaries will need to add more charges to make participation worthwhile.
We recommend starting with very simple rules, knowing they can be fine-tuned later. For example, for the first year a city might only permit established local employment businesses to be intermediaries. Only temporary employee (W-2) status could be permitted for workers. But a determination to evolve to wider scope and a variety of contractual options for workers can be made clear.