Gig Economy Project: Ben Wray, Maradia Tsaava – Gig work in Georgia: “Another hell”

Gig work in Georgia is precarious and strikes are regular, just like in the Western world. The crucial difference is the wider context of Georgia’s labour market.

Ben Wray is a freelance journalist based in Spain and co-ordinator of the Gig Economy Project. Maradia Tsaava is a freelance journalist based in Tbilisi, Georgia.

This article was also published on the JAM News website as part of the Spheres of Influence Uncovered project, implemented by n-ost.

Georgian Bolt driver Giorgi Jamureli (Picture by Radio Free Europe)

THE story of Giorgi Tikaradze, a 36 year-old food delivery courier in Tbilisi, reflects the push and pull factors which drive Georgians to work in the gig economy. “Before becoming a courier, I was working as a barman for many years,” he says. “It was hell, but from there, I have ended up in another hell.”

Tikaradze started at Wolt, a Finnish food delivery platform, in 2020. Long hours, stagnating pay and a lack of responsiveness from Wolt led Tikaradze to join a high-profile strike, which took place from February to April last year.

“I had an accident before the strike and couldn’t work,” he says. “After the strike, Wolt blocked me from the system.” Tikaradze is not the only courier to have suffered this fate. Other riders who participated in the strike also had their accounts deactivated by Wolt.

Some of the riders registered a discrimination complaint with the public ombudsman, who found in their favour. The ombudsman recommended that Wolt rehire the workers, but the recommendation was not compulsory, and Wolt ignored it.

Asked about this incident, Natalia Jaliashvili, Wolt’s Public Policy Manager, said: “Courier partners who were offboarded from our platform were found to be in breach of the partner agreement with Wolt. Each courier partner received a detailed explanation outlining the reasons for their offboarding.”

The case is indicative of the power imbalance that exists between gig workers and the digital labour platforms they work for in Georgia. With the state either unwilling or incapable of taking action, and with an unemployment rate of 17%, platforms like Wolt have a wide degree of latitude to act as they wish.

Georgia’s non-existent workers’ rights

Tikaradze moved on to work for one of Wolt’s main competitors, Glovo, but has only discovered “the same hell.” Nonetheless, he doesn’t plan to stop working in the gig economy.

“If I work non-stop, I still make more money than at an ordinary job, where the salary is around 1200 Lari per month [just over 400 Euros],” he says. “Here, I can make 100 Lari per day, if I make 40 orders in 12 hours.”

Tikaradze and other Georgian gig workers we spoke to described similar problems to those faced by couriers in the West, including long hours, unfair de-activations, and dangerous work. However, the difference in Georgia is that pay in the wider labour market is often lower than in the gig economy. The minimum wage is virtually non-existent, and workers’ rights are weak and rarely enforced.

“Even standard jobs are precarious in Georgia,” Ana Diakonidze, a sociologist at Tbilisi State University and expert in platform work, says. “I’ve interviewed people from standard jobs who hadn’t had a vacation for four years. So, of course these workers don’t find gig work problematic, quite the opposite.”

Additionally, self-employed workers in Georgia pay a maximum of 1 percent of their income in tax, compared to a rate of 20% for employees.This explains why there has been little desire among Georgia’s gig workers to push for employment rights, even though the public ombudsman and the Labour Inspectorate have both found that there is a labour relationship.

There appears to be a convenient consensus among actors in Georgia not to rock the boat on the question of gig workers’ employment status, a totemic issue in the European Union.

“The crucial battlefield in the gig economy in developed countries is the status of the worker: are they employees, or independent contractors,” Vako Natsvlishvili, lecturer at Tbilisi State University and labour law researcher, says. “In Georgia, labour law doesn’t defend the rights of those who already are in the system. This is why there is no demand from gig workers to fight for employment status.”

The sliding doors of platform capitalism in Georgia

However, the unique position of gig workers in the wider Georgian labour market, has not stopped disputes within Georgia’s gig economy from mounting, as pay goes down while the cost of living continues to rise. The latest strike was by Bolt taxi drivers in January, after the Estonian multi-modal platform reportedly raised the commission it takes on each trip from 10 per cent to 23.6 per cent – a claim that Bolt denied, saying it had addressed the striking drivers’ requests “point by point”.

Georgia’s gig workers have been caught in the sliding doors of western platform capitalism. Business models in the gig economy have gone through a rapid transformation since 2022 as inflation surged and interest rates began to rise. The increased cost of money made financial investors increasingly sceptical about throwing cash at food delivery and taxi platforms, almost all of which have been loss-making since they launched around a decade ago.

“It’s clear that the market is experiencing a seismic shift and we need to react accordingly,” Uber CEO Dara Khosrowshahi told staff in a leaked email in May 2022, adding: “Channelling Jerry Maguire, we need to show them the money.”

This ‘tech downturn’ has led to all of the digital labour platforms’ moving away from growth-before-profits strategies, towards more financially sustainable models. So far, only Uber has managed to make a profit, but all the platforms have sought to increase their revenues principally by squeezing their workers.

When Wolt entered the Georgian market in 2018, it was still in its growth-before-profits phase. Money was cheap and deliveries were subsidised by the company in order to gain market share at the expense of rivals.

But by the start of 2023, Wolt had changed tack entirely. It slashed the pay of its riders in Georgia as part of a Europe-wide move to lower labour costs, sparking strikes not only in Georgia, but in at least seven other European countries as well. This international strike movement was accompanied on social media with the hashtag ‘#ReWolt’.

When these global players tighten their belts, it’s the riders and drivers who feel the pain. A study published in March by Fairwork, a University of Oxford research project on the gig economy, found that both Wolt and Glovo met just four out of ten criteria for minimum standards of fairness towards their workers. Taxi platforms Bolt and Russian-platform Yandex (which Uber had a stake in until last year) met just one out of ten.

“Regrettably, it appears that the platforms have yet to take substantial measures to address the myriad challenges faced by their workers,” the Fairwork study concluded.

Asked about the Fairwork study, Jaliashvili said Wolt had organised a company survey that found “the majority of our partners are satisfied with their collaboration with us.” Bolt said it did not participate in the Fairwork study because it did not believe it could “reflect all the particularities of each business”, while a Glovo spokesperson said that they work closely with Fairwork and “acknowledge that there is room for growth”.

Could Georgia follow EU gig economy regulation?

While the foreign investment of digital labour platforms into Georgia may be presenting new challenges for workers, they also offer the possibility of new, better paying jobs.

A paper by Georgian economists Murtaz Kvirkvaia and Mogeli Shengelia published in February argued that platforms should be welcomed to Georgia as they can help “reduce unemployment and provide extra sources of income for the employed population.”

Georgia has a fairly advanced digital infrastructure, and Kvirkvaia and Shengelia also point to remote work platforms like Freelancer, Upwork, Fiver and Guru as examples of where Georgians can reliably access gig work from their own home. But while cloudwork platforms also present opportunities previously unavailable to Georgian workers, they offer even fewer possibilities for worker organisation and accessing labour rights than food delivery couriers and taxi drivers.

Salome Shubladze, Director of the Social Policy Programme of Georgia’s Social Justice Center, does not believe the job-creation potential of digital labour platforms outweighs the risks to workers’ rights in Georgia. For her, regulation is necessary to balance these risks: “It’s not about if the platforms are good or bad, it’s about how they operate in Georgia. We know these companies are going to be here, but if the EU can regulate platform work then this work can also be regulated here.”

On 11 March, the European Union agreed to the Platform Work Directive, which will establish a legal presumption of employment for workers in the platform economy in all 27 EU member-states, as well as a set of new workers’ rights in relation to algorithmic management. Last year, Georgia was officially granted EU candidacy status, putting the country under the spotlight for potential membership.

Shubladze, who previously worked as a lawyer for the Georgian Government, believes that the EU Platform Work Directive might finally move Georgian politicians into action on platform work regulation.

“In the past, when there was labour reform in Georgia, it always happened through advocacy with the EU,” she says. “Now Georgia has the candidacy status, and so in that context there might be some kind of push to reform in this area. But it is always at least a few years after the EU does something before there is any movement in Georgian politics.”

The gig economy has brought much needed opportunities to a country in dire need of them, but as the business model of these global platforms’ shift, the costs of having all-powerful companies are beginning to show. Whether Georgia follows the EU Platform Work Directive or not, regulation will be needed to rein-in the excesses of the gig economy.

The Gig Economy Project is a BRAVE NEW EUROPE media network for gig workers in Europe. Click here to find out more and click here to get the weekly newsletter.

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