Rethinking Labor Protection: China’s Gig Economy
By: April Pang
Edited by: Eleanor Bergstein and David Liu
Introduction
The gig economy consists of temporary and flexible jobs carried out by independent workers. Within this system, China’s food delivery industry stands out as one of the largest and most influential gig-economy sectors in the world. It is now valued at over $200 billion and employs more than seven million riders, supporting the daily lives of hundreds of millions of consumers. [1] But, its rapid growth has revealed a deeper structural problem. Most riders are classified as independent contractors and fail to receive the protections of standard employment law.
Case Study: Challenges in China’s Current Food Delivery Sector
Two companies dominate China’s food delivery market: Meituan and Ele.me. Together, they hold a market share of roughly 69 percent and 25 percent, respectively. Their duopoly has both streamlined delivery and concentrated decision-making power in ways that affect restaurants, riders, and consumers. Although every participant in the ecosystem depends on how these platforms operate, most of their operational rules remain hidden behind opaque algorithmic systems.
This opacity, however, is central to how the platforms operate. According to iiMedia Research, companies like Meituan and Ele.me rely on complex algorithms to decide how much restaurants must pay in fees, how many orders a rider receives, and which delivery routes they are assigned. [2] But the platforms do not explain how any of these decisions are made, so restaurants and riders are unable to see or question those rules that shape their income. This creates an uneven relationship in which platforms continually optimize for efficiency and profit, while merchants and workers bear a greater share of the operational risk. Commission fees that restaurants pay the platform for every delivery order are increased without any explanation, and riders struggle to understand why they receive fewer orders than coworkers with similar performance.
Delivery times show straightforwardly how algorithmic governance has influenced gig workers. About a decade ago, a rider had 45 minutes to complete a delivery. Today, that window may be as short as 20 minutes, regardless of the weather or traffic. The pressure to meet shrinking deadlines pushes riders to potentially compromise their safety to shorten their delivery time. Platforms provide some flexibility for riders but a host of challenges as well. Specifically, riders can choose when to log in, but the threat of deactivation for late deliveries leaves little room for any negotiation. [3] Riders also face income volatility and high accident rates, and in the long term, career advancement opportunities are limited. [4]These challenges imply broader weaknesses in the employment model itself. Most riders are classified as independent contractors, which excludes them from basic labor protections such as minimum wage guarantees, social insurance, or collective bargaining rights. [5]Algorithmic rating and review systems, which score riders based on delivery speed and customer feedback, further weaken their individual bargaining power. A single low score or negative customer feedback can reduce earnings for days.
Societal perception of gig work also contributes to the issue. Their tasks are frequently described as simple “errands,” which makes the work seem quick and low-skill. This mindset overlooks the physical strain and coordination such jobs require [6]. As a result, the public undervalues their labor, making it harder for workers to advocate for better working conditions. [7]
Additionally, data practices embedded in digital platforms expose workers to new forms of risk. Riders are tracked in real time, but there are no limits on how this data is used. [8] But it is possible to present changes to the system. Bluster et al. highlight that four critical factors can influence a worker’s experience: income stability, labor protections, worker voice, and client behavior. [9] To produce meaningful change in the gig economy system, structural and organizational solutions are necessary.
Suggested Improvements in Regulations
Addressing the problem of algorithmic control requires both policy reform and platform accountability. First, regulatory authorities need to strengthen antitrust oversight to reduce the excessive market power of Meituan and Ele.me. [10]Through either encouraging competition or supporting smaller industries, local platforms can mitigate the risks of duopoly exploitation.
Second, platforms should be required to increase algorithmic transparency. [11] Clear disclosure of how fees, restaurant rankings, and order distribution are determined would help reduce information asymmetry and restore fairness to both merchants and riders. Third, labor protection can be expanded through portable social insurance offerings that tie benefits directly to workers rather than to a single employer. [12]This allows gig workers to carry their health, accident, and pension coverage across platforms and accumulate benefits regardless of where they work. [13]This would protect their employment flexibility while providing basic security. Additionally, platforms should be mandated to contribute a share of revenue into these offerings to offset costs translated to workers. In the U.S., companies and states have already started offering portable benefits. For example, DoorDash tested a program in Pennsylvania in which gig workers received a benefits account that followed them from platform to platform. States like Utah and Tennessee have also passed laws that allow companies to contribute to benefits for their independent contractors. [14]Finally, collective action is of vital importance. [15] Local governments and trade unions can support the establishment of digital workers' associations, which in turn can provide riders with ways to express their concerns and negotiate terms. Therefore, this can ensure that their basic rights are protected and not ignored, requiring enterprises to establish industry-wide minimum wages and transparent systems. [16]The trade union can further allocate funds to enhance the transparency of the algorithm. They can establish teams to review scheduling and rating systems and set up training funds to enhance workforce skills and improve job mobility.[17]These measures not only help to mitigate the income instability of relatively low-skilled workers but also support sustainable career development for gig workers.
Conclusion
China's food delivery industry reveals that the gig economy has improved the lives of consumers and gig workers but presents unique drawbacks. While this market service allows for efficient services, insufficient supervision and regulations lead to the exploitation of workers and merchants. A balance needs to be established between innovation and fairness. Strengthening supervision reforms, such as collective bargaining on transferable benefits and privacy protection, is not only necessary for China’s gig economy but also crucial in ensuring the fairness of the gig economy and digital integration on a global scale.
Notes:
1. Chris Lau et al., “Why Drivers in China’s Food Delivery Market Are Having Meltdowns | CNN Business,” October 18, 2024, https://www.cnn.com/2024/10/17/business/china-food-delivery-drivers-meltdowns-intl-hnk.
2. iiMedia Research, “iiMedia Research | 2024–2025 China Food Delivery Industry Lower-Tier Consumer Market Research Report – Food Delivery Industry Report, iiMedia Report,” 2024, https://report.iimedia.cn/repo148-0/46653.html.
3. Alex J Wood et al., “Good Gig, Bad Gig: Autonomy and Algorithmic Control in the Global Gig Economy,” Work, Employment and Society 33, no. 1 (2019): 56–75, https://doi.org/10.1177/0950017018785616.
4. Rita Liao, “Viral Article Puts the Brakes on China’s Food Delivery Frenzy,” TechCrunch, September 9, 2020, https://techcrunch.com/2020/09/08/viral-article-puts-brakes-on-chinas-food-delivery-frenzy/.
5. Nikos Koutsimpogiorgos et al., “Conceptualizing the Gig Economy and Its Regulatory Problems,” Policy & Internet 12, no. 4 (2020): 525–45, https://doi.org/10.1002/poi3.237.
6. Jacob Rosenberg, “Gig Workers Are More Undervalued than Ever before. Tech Companies Are Spending like Crazy to Keep It That Way.,” Politics, Mother Jones, May 2020, https://www.motherjones.com/politics/2020/04/gig-workers-are-more-undervalued-than-ever-before-tech-companies-are-spending-like-crazy-to-keep-it-that-way/.
7. Lindsey D. Cameron and Kalie M. Mayberry, “How Gig Work Pits Customers Against Workers,” Society and Business Relations, Harvard Business Review, April 3, 2024, https://hbr.org/2024/04/how-gig-work-pits-customers-against-workers.
8. Amogh Pradeep et al., “Gig Work at What Cost? Exploring Privacy Risks of Gig Work Platform Participation in the U.S.,” Proceedings on Privacy Enhancing Technologies 2025, no. 1 (2025): 491–510, https://doi.org/10.56553/popets-2025-0027.
9. David L Blustein et al., Understanding Decent Work and Meaningful Work, 2023.
10. Marshall Steinbaum, “ANTITRUST, THE GIG ECONOMY, AND LABOR MARKET POWER on JSTOR,” 2019, https://www-jstor-org.turing.library.northwestern.edu/stable/48568471?seq=1.
11. Guowei Zhu et al., “Gig to the Left, Algorithms to the Right: A Case Study of the Dark Sides in the Gig Economy,” Technological Forecasting and Social Change 199 (February 2024): 123018, https://doi.org/10.1016/j.techfore.2023.123018.
12. Laura Padin, “Why Workers Need Real Portable Benefits,” National Employment Law Project, March 23, 2025, https://www.nelp.org/insights-research/why-workers-need-real-portable-benefits/.
13. Friedemann Bieber and Jakob Moggia, “Risk Shifts in the Gig Economy: The Normative Case for an Insurance Scheme against the Effects of Precarious Work*,” Journal of Political Philosophy 29, no. 3 (2021): 281–304, https://doi.org/10.1111/jopp.12233.
14. Courtney Vinopal, “Why Tech Companies and Some Lawmakers Want to Fund Gig Worker Benefits,” HR Brew, August 8, 2025, https://www.hr-brew.com/stories/2025/08/08/tech-companies-lawmakers-portable-benefits.
15. Sarah Kaine and Emmanuel Josserand, “The Organisation and Experience of Work in the Gig Economy,” Journal of Industrial Relations 61, no. 4 (2019): 479–501, https://doi.org/10.1177/0022185619865480.
16. Hannah Johnston and Chris Land-Kazlauskas, Organizing On-Demand: Representation, Voice, and Collective Bargaining in the Gig Economy, no. 94 (2018).
17. Jeremias Adams-Prassl and Martin Gruber-Risak, “Uber, Taskrabbit, & Co: Platforms as Employers? Rethinking the Legal Analysis of Crowdwork,” SSRN Scholarly Paper no. 2733003 (Social Science Research Network, February 16, 2016), https://papers.ssrn.com/abstract=2733003.
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Liao, Rita. “Viral Article Puts the Brakes on China’s Food Delivery Frenzy.” TechCrunch, September 9, 2020. https://techcrunch.com/2020/09/08/viral-article-puts-brakes-on-chinas-food-delivery-frenzy/.
Padin, Laura. “Why Workers Need Real Portable Benefits.” National Employment Law Project, March 23, 2025. https://www.nelp.org/insights-research/why-workers-need-real-portable-benefits/.
Rosenberg, Jacob. “Gig Workers Are More Undervalued than Ever before. Tech Companies Are Spending like Crazy to Keep It That Way.” Politics. Mother Jones, May 2020. https://www.motherjones.com/politics/2020/04/gig-workers-are-more-undervalued-than-ever-before-tech-companies-are-spending-like-crazy-to-keep-it-that-way/.
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