A landmark deal between Uber and one of its toughest critics could shake up the gig economy.

Under the agreement between the rideshare giant and the Transport Workers Union, the US-based company will support the introduction of a minimum income “safety net”.

It would also support the creation of an independent body to create industry-wide standards and a dispute resolution mechanism.

Uber Australia director Dom Taylor said the deal was a “proactive” move, denying it was caused by the threat of stricter regulation from the new Labor government.

“Ultimately, we are trying to improve the quality of independent work here in Australia for rideshare drivers and online food delivery companies,” he told ABC Radio National.

Camera iconUber has signed a milestone agreement with the TWU. NCA NewsWire / David Geraghty Credit: News Corp Australia

Ahead of the May elections, Labor pledged to update the Fair Work Act to reflect the rise of the gig economy and expand the Fair Work Commission to include “employee-like” forms of work.

Uber is the second platform to sign an in-principle agreement with the TWU after Doordash signed a deal in May.

The rideshare giant has signed similar agreements with unions in Canada and the UK.

TWU’s National Secretary Michael Kaine said Australian laws are “hopelessly outdated” when it comes to workers classified as independent contractors.

“If you’re an employee and you’re categorized as such, you get all the rights we’ve built up over the decades,” Mr. Kaine told ABC’s RN.

“(But) if you’re an independent contractor, even if you’re very dependent on the entity that hired you, all of a sudden you don’t get any rights and terms.

UBER ELECTRIC
Camera iconUber is the second rideshare platform to come to the table after Doordash. NCA NewsWire / David Geraghty Credit: News Corp Australia

“What we’re saying, along with Uber, is the laws need to change.”

In 2020, seven food delivery drivers died on the job.

Uber has fought tooth and nail not to classify drivers and drivers as employees.

Mr Taylor said the agreement balanced work flexibility with greater driver protection.

“We have an archaic system of labor relations that creates a clear dichotomy between contractors and employees,” he said.

“The flexibility had to be traded for things like benefits and protection — and we don’t think that need to be the case.”

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