Business Social Responsibility funding Employment Benefits of Working Poor Living Below the Poverty Line
Sydney, Australia: Online service PByT, which stands for powered by trust, has announced a new approach to funding employee benefits of the working poor, including those working in the new emerging employment sectors like the sharing or gig economy. This is achieved by expanding business social responsibility beyond delivering profits to include the creation of a Global Social Capital Fund with the goal of re-balancing the global economy following the economic experiment of deregulation and privatization and the failure of trickle-down economics. The distribution of the new employee benefits is set to occur through select members of the global network of trade and labour unions which represents more than 200 million workers in over 60 countries.
“While the economic experiment of deregulation and privatization created new efficiencies, it also exacerbated inequality, poverty and disadvantage through the failed idea of trickle-down economics. The emergence of the gig economy, which is creating a new flexible employment sector without the usual employee benefits, has the potential to dramatically increase the number of the working poor,” says George Matafonov, founder PbyT.net.
“Trickle-down economics has not just failed to deliver the promised benefits, it also resulted in the greatest transfer of wealth in human history. This initiative begins the process of rebalancing the global economy so that more people can share more fairly in global prosperity. It is also a return to the basic idea that society, like the proverbial chain, is only as strong as its weakest link,” he adds.
PByT tackles social issues like inequality, poverty and disadvantage through a Global Social Capital Fund funded by a social responsibility levy of 1% - 2.5% of revenue built into the PByT subscription fee for corporations and other for-profit groups and businesses.
In Australia, for example, the amount distributed to the working poor could eventually exceed $25 billion each year, based on the Australian GDP of $1.5 trillion.
"Why would the for-profit sector participate? Because it is a market economy and people will increasingly choose to buy and use services only from socially responsible services and organizations,” says Matafonov.
PByT does not provide employee benefits directly, rather it will rely on the global network of trade and labour unions to pass on the funds to their members based on eligibility conditions they deem appropriate and fair, in consultation with social service organizations like ACOSS in Australia.
"Creating a centralized global means of distributing funds would be almost an impossible task given the differing needs of workers in different countries. We have opted, instead, to partner with the union movement, which currently represents over 200 million workers in over 60 countries to be the point of distribution. We expect that union participation will skyrocket as a result, ensuring that unions will play an increasingly important role in a global economy dominated by corporations," says Matafonov.
The yearly payments can be used by workers to supplement their income, buy health and disability insurance, fund holidays or save for retirement. This flexible approach to employment benefits complements the flexibility of the gig economy, while also reducing the dependence and hold of gig economy platform operators.
While market forces can compel the for-profit sector to participate, governments can help by providing tax incentives to the socially responsible groups and organizations as this initiative has the potential to reduce the cost of social security and welfare by giving more people the opportunity to earn a living, beyond just surviving.
BEYOND MINIMUM PAY, MINIMUM ENTITLEMENTS
While much of the focus of the global union movement has to date been on implementing minimum pay and minimum entitlements, this initiative goes beyond that to systemic change.
Systemic change is the only way to enable more people to share more fairly in global prosperity and this can be achieved simply by following Uber's example.
TAKING A LEAF OUT OF UBER'S PLAYBOOK
The Uber founders did not create their business by pleading with governments, protesting or striking, rather they went straight to the market with a unique proposition and practical solution to improve a public transport service that was failing.
The same approach can now be applied to gain fairness in the global economy by going directly to the market with another simple proposition - expand business social responsibility to include the funding of employee benefits of the working poor, living below a given poverty line.
Uber has already agreed to this idea, in principle, when CEO Dara Khosrowshahi floated the idea of creating a “flexible benefits fund” to fund employee-like benefits for ride-share drivers. He even suggested that Uber would have contributed US$655 million into a Flexible Benefits Fund in that year, which is in line with the PByT proposal of a social capital levy.
All it will take to bring about real and meaningful change is for enough people to take action by doing nothing more than having their say on PByT.
The market will do the rest as Uber has already proven.
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