0 Introduction In September 2017 the Swedish company Ikea bought TaskRabbit to be able to help customers assemble the furniture they buy at Ikea (Swisher, K., & Schleifer, T. 2017). Even though Ikea bought TaskRabbit, the company will keep operating on its own under their former CEO Stacy Brown-Philpot along with their former staff (Morgan, B. 2017).
TaskRabbit was founded in 2008 by Kevin Busque and Leah Busque. In 2016 Brown-Philpot took over the job as CEO from Leah Busque, after working as a Google executive (TaskRabbit). Formerly known as RUNmyERRAND, TaskRabbit is an online two-sided marketplace that connects people to help each other get things done. TaskRabbit has two customer segments, people who want to perform a task and people who want to outsource a task.
Anything from buying groceries, doing laundry, furniture assembly, house cleaning can be outsourced (Kuttner, R. 2013).The platform currently has an overall of 50 to 200 employees with its headquarters located in San Francisco, California. The independent amount of workers who use the platform are approximately 60,000.
(TaskRabbit) Humankind has been sharing things for a long time and with today’s technology, the sharing economy is growing more rapidly (BRON). A sharing economy is a form of a digital economy created to share human, physical and intellectual resources online (Langley, P. and Leyshon, A.
2017). The sharing economy can be seen as a marketplace that makes it possible to transfer underutilized resources (Koopman. C,. Mitchell. M,. & Thierer. A.
2015) and it solely depends on a customer to customer (C2C) interaction (Schor, J. B., & Fitzmaurice, C. J. 2015). This arising form of economics makes new opportunities accessible for people who want to earn more on top of their salary. Aside from this advantage, this sector does prevent employment regulation (Aloisi, 2016). As a result, there have been some discussions about which labor laws contractors face when being part the sharing economy and whether there should be an employment relationship.
This paper will make use of a qualitative research approach to find out if it is important to set labor laws and to which extent there should be an employment relationship. This will give an indication of what can be improved in the sharing economy and especially at TaskRabbit. To be able to do so this paper will do a literature review based on academic articles in combination with news articles.
In the second paragraph, the theoretical framework, the concepts of TaskRabbit will be explained further, to provide a greater understanding of how this company contributes to the sharing economy. In the discussion section, the research question will be answered and a second research question will be drafted relating to labor laws in the sharing economy. Finally, this paper will be summarized in the conclusion and the research question will be answered. 2.0 Theoretical Framework 2.1 General backgroundThe sharing economy is becoming a big part of the economy and the sum of companies is increasing in this sector.
Because of this and the fact that it is taking over some traditional industries in the market, the discussion has risen whether these markets should be regulated and if so in what sort of way (Koopman, C., Mitchell, M., & Thierer, A. 2015). Sharing is a well-known fact and is been used throughout history.
With today’s technology, the process of sharing has become accelerated. The main difference between sharing in the past and sharing now is that people now share with strangers as well instead with only their friends, family and neighbors (Frenken. K.
, & Schor. J. 2017). Considering that online marketplaces including TaskRabbit consist of a great deal of information about the products, users, and services, it reassures people who want to make use out of it. This results in more trust in the platform and users (Edelman. B., & Luca, M. 2014)In addition, sharing through the use of a platform makes it more accessible.
A platform is a business model that is designed to coordinate services, products, and data through a set of technologies (BRON). Because digital platforms cut down the asymmetric information by allowing reviews and ratings the uncertainty of trusting strangers has declined in comparison with the past (Frenken. K., & Schor. J.
2017). The success of these companies relies on their ability to create trust between buyers and sellers (Edelman. B., & Luca, M. 2014).As mentioned before a sharing economy is a form of a digital economy created to share human, physical and intellectual resources online.
Compared with the past the word sharing has altered its meaning gradually with the expansion of technology (Kaplan & Haenlein, 2010). Formerly the word implied sharing information for instance photographs through social media. Now, in the sharing economy, it refers to the sharing of resources through online platforms (Galbreth, Ghosh, & Shor, 2012; Hennig-Thurau et al., 2007).
The definition of the sharing economy can be divided into three parts which show how the sharing economy is different from other forms of economic. The most important one is that a sharing economy consists of a consumer-to-consumer platform hence the name peer-to-peer economy. Secondly, this form of economy emphasizes on the term temporary access, it’s about sharing and exchanging resources with no requirements of owning it. And lastly, the sharing economy helps to use physical assets more efficiently. (BRON)As discussed previously, TaskRabbit is part of the sharing and is an online platform that connects people to help each other with tasks. On this platform, you can hire physical assets to help you around the house. By posting the task one wants to outsource with some added information TaskRabbit will then try to match the service to demand. This way people have an option of who to choose based on price, distance, and recommendations (BRON).
According to Rannie Teodoro et al., workers who engage in this kind of work are called on-demand mobile workforce. This is because they can make their own schedule which is different from traditional work (Teodoro, R., Ozturk, P., Naaman, M., Mason, W.
, & Lindqvist, J. 2014). Former CEO Lea Busque vision was to revolutionize the way society works. In an interview with the guardian she mentioned that ”By providing people with the tools and resources to set their own schedules, be their own bosses and say how much they want to get paid is incredibly empowering.
It has huge implications for the global labor force” (Silver, J. 2013).Like TaskRabbit, most other platforms of the sharing economy are digital businesses. A network effect is an important concept for these digital businesses because it increased the value of the platform when more people use it (Birke, D. 2009). An example which is given by Birke concerns the telecommunication network but it can also be applied to TaskRabbit.
When there aren’t any people who are using TaskRabbit for either taking a task or outsourcing one the platform’s utility will be significantly low. When more people make use TaskRabbit the utility of each user will increase. The value this platform is able to create for its users depends directly on the number of people taking part of it. More people lead to more tasks options and also lead to more options for choosing the right person for the task. The platform finds its customers mostly through internet marketing and word of mouth advertising. TaskRabbit earns its revenue by taking a cut of each transaction that takes place in the marketplace. TaskRabbit takes 30% of each transaction that takes place in the marketplace.
(TaskRabbit). The estimated revenue is around 10 to 50 million dollars (BRON). As indicated previously the sharing economy causes some traditional industries to make losses. (Koopman, C., Mitchell, M., & Thierer, A. 2015).
As far as TaskRabbit concerns it’s difficult to tell which businesses the company disrupts due to the heterogeneity of the services they provide (BRON?) 2.2 DiscussionAlthough TaskRabbit is a successful platform and has grown over the last few years it does have some faults to it just like the rest of the companies in the sharing economy. The sharing economy has changed the type of work that exists. On-call work, casual work, mobile work are all new forms of employment that have been created because of the digitalization of the economy (eurofound, 2015).
The aspect that stands out in this sector is that there is a case of a three-sided relationship. That is, the platform, the worker and the requester (Aloisi, A. 2016). These new relationships that are a result of the sharing economy are different from the traditional ones and thus do not fit within the current regulations concerning employees as contractors. This characteristic is necessary to distinguish due to the lack of regulation that exists in these new work relationships (Harris, S.
D, & Krueger, A. B. 2015).
These workers that are part of this sector are aligned as independent contractors (Aloisi, A. 2016). These new forms of employment in the sharing economy and thus TaskRabbit may be able to provide new economic opportunities and more flexibility. It also radically decreases resource consumption while increasing access to resources at the same time thus making the use of resources more efficiently (Transfer). Aside from the advantages workers face when being part of the sharing economy there are a many disadvantages as well in the sharing economy environment and TaskRabbit. First of all, as discussed briefly, the workers in the sharing economy are not covered by the public social insurance system or the public health insurance services and do not qualify to receive unemployment benefit.
Furthermore, such work does not generally contribute to the worker’s career development because, in the majority of cases, the job is not related to their field of study. Apart from not being related to their field of study, people part of the sharing economy e.g. students, people seeking more income, compete with professionals who will lose a part of their profit due to the new platforms. Apart from not being qualified to do the job in the first place they also do not have any tax regulations (BRON).
Almost all the platform that is part of the sharing economy are non-regulated. In the case of TaskRabbit, there is almost no employment relationship. Some taskers have to do strange tasks which they did not expect to do when they signed up. As well as sometimes doing a task in bad working conditions, in addition, some get paid less than the minimum wage (TASKRABBIT). Yet as this paper indicates the platform of TaskRabbit causes an increase in the performed labor in the overall economy.
However, there are some limitations to it…. 3.0 ConclusionSharing economy is a form of digital economy that is created to share human, physical and intellectual resources online. A company that is part of this sharing economy is TaskRabbit, an online two-sided marketplace that connects customers to help each other with tasks. Many opportunities have been created because of the TaskRabbit such as, transfer of underutilized resources and more supply that matches the demand. The workers who are part of TaskRabbit are called on-demand mobile workforce. As indicated by academic research this paper suggests that there are little to labor laws these that workers face. They do not have the benefits a traditional worker would have and there haven’t been any regulations made for these new on-demand mobile workforce.
In addition, there are not any employment relationship among the users of TaskRabbit……