Gig Economy Wages Dip Below Minimum Wage

Gig economy apps are increasingly being used to hire retail and hospitality staff, with companies like Urban Outfitters, Dreams, and Royal Parks cafe operators utilizing platforms such as Temper. Workers engaged through these apps can find their hourly pay falling below the legal minimum wage due to service fees charged for faster payment. For instance, a fee of 2.9% on a £12.50 hourly wage reduces it to £12.14, below the £12.21 minimum for those aged 21 and over as of January 31, 2026.

These workers also often miss out on statutory employment rights, including paid sick leave, rest breaks, and holiday pay. While Temper offers an insurance scheme for sick pay, it has stringent conditions, requiring at least 10 previous shifts and a two-week waiting period, contrasting sharply with statutory sick pay that begins much sooner for employees. The TUC is urging the government to expedite promised reforms to tackle 'bogus self-employment' and close legal loopholes that allow some employers to deny workers their full rights.

Temper refutes claims of bogus self-employment, asserting that its workers have flexibility, can negotiate pay, work for multiple clients, and have cancellation protections. The app claims to set a minimum pay floor of £12.50 per hour, rising to £13 from February 1, 2026. However, the TUC argues that without stronger regulation, such platforms can be exploited to circumvent employment law, potentially leading to widespread denial of workers' entitlements.