Is the EU en route to fairer working conditions in the gig economy?

Background

On 9 December 2021, the European Commission published the long-awaited Proposal for a Directive on improving conditions in platform work. This is a significant development since the year of 2019, in which the labour conditions of platform workers as a regulatory priority were expressly included by Ursula von der Leyen in her Mission Letter to Nicolas Schmit (Commissioner for Jobs and Social Rights). President von der Leyen called for better labour conditions, making them transparent and predictable. It appears that platforms often treat their workers unfairly and, by virtue of the gig economy’s failure to correctly determine their employment status, there is a tendency to shy away from basic obligations and responsibilities towards the workers. The new draft Directive aims at ensuring fairer working conditions in an EU platform economy.

Key Elements of the Proposal

The main objectives of the proposal include: (1) ensuring the correct determination of the platform workers’ employment status, which enables access to the applicable labour and social protection rights; (2) ensuring fairness, transparency and accountability in algorithmic management in the platform work context; and (3) improving enforcement of the applicable rules. Arguably, people who work through digital labour platforms fall outside of the scope of the existing labour laws. This issue has been highlighted by the COVID-19 pandemic: the apparent misclassification of the platform workers’ working status has aggravated their vulnerable working conditions, often leaving them without any financial support and adequate health and safety conditions.

Aiming to tackle these issues, the new draft Directive broadens the scope of the existing labour laws for all EU workers having an employment relationship with a digital labour platform (Art 1(2)). In addition, it provides a definition of ‘digital labour platforms’ in Art  2(1), covering platforms providing commercial service (ordered online at the request of a recipient, and performed by individuals; therefore, relevant to platforms such as Uber (taxi services) and Thuisbezorgd (food delivery workers).

Furthermore, it proposes ways of dealing with the possible misclassification of platform workers, e.g. falsely having a self-employed status (Chapter II). With the aim to increase legal certainty, the proposal provides a control criteria to determine the employment status of a platform worker: if at least two of these five criteria are met, the platform is considered to be their “employer”. For example, if a platform enforces a dress code and supervises the performance of work by way of algorithmic management, this creates a legal presumption of employment status. Having that determination procedure in place will help secure the workers’ rights to benefit from labour and social laws. It is further specified that if the digital labour platform is willing to rebut the presumption of the employment status of their worker, it is possible, however, the burden of proof will be on the platform.

An important step forward in the improvement of labour conditions in the platform economy is the strengthening of protection against the overly-intrusive algorithmic management. The draft Directive obliges Member States to ensure transparency on automated monitoring and automated decision-making systems by way of requiring digital labour platforms to inform platform workers of these systems (also including self-employed workers). These are, for instance, used to monitor, supervise, and evaluate the work performance of platform workers, and can significantly affect their working conditions. It further requires Member States to ensure that these AI systems are regularly monitored and evaluated, which then requires human input.

When it comes to the aim of better enforcement of labour market policies, the Proposal mandates better transparency concerning algorithmic management, which lies at the heart of the digital labour platforms’ business model. For the sake of clarity, it is deemed necessary to report to the authorities the extent of the exercised control by the platforms over their workers.

Final Remarks

Even though the new draft Directive is still a work in progress, it is a great step towards ensuring the protection of platform workers’ right to enjoy adequate labour and social protection. This development is crucial for ensuring that digital labour platform workers are treated fairly and have equal standing before the law. Reclassifying digital platform workers’ status from falsely self-employed to the status of an “employee” will further ensure they are treated in the same way as their counterparts - offline workers.

Written by Milana Ulitina, M-EPLI intern