Significant changes for platform work(ers) ahead

The European Commission recently presented several measures to improve the position of platform workers, including a draft Directive on Platform Work which aims at improving the working conditions of platform workers (the Directive). The Directive has three objectives: (i) to enable platform workers and platforms to correctly determine the employment status of platform workers; (ii) to increase the fairness, transparency and accountability of platforms when they use algorithms and (iii) to increase transparency around platform work. We will go into these three objectives and their significance for the day-to-day practice below.

Employment status

The Directive introduces a legal presumption based on which the existence of an employment contract is assumed if the platform ‘controls’ the work of the platform worker. What is meant by control is elaborated on in five criteria. If at least two of the five criteria are met, the platform is deemed to control the platform worker in which case the platform worker is presumed to have an employment relationship with the platform. The five criteria are as follows:

• The platform determines or caps the remuneration of the platform worker
• The platform sets rules for platform workers in relation to their appearance and/or behaviour for the performance of the work
• The platform supervises the execution of work or controls the quality of results (including by electronic means)
• The platform restricts the freedom of platform workers to organize their work (with respect to working hours or absence) in respect of accepting working hours and/or arranging a replacement worker and
• The platform restricts platform workers from building up their own client base and engaging in ancillary work

Platform workers who have an employment status are entitled to receive better working conditions (in areas such as health and safety, minimum wage and training opportunities). Any worker who does not meet two or more of these criteria can be qualified as an independent contractor. These rules should in the eyes of the European Commission not only provide platform workers, but also platforms more certainty, which is in the interest of all parties concerned. Uber has indeed on occasion indicated that at least one set of rules for platform workers in the EU would help sustain its business model.

It is good to understand that the legal presumption mentioned above can be refuted (by the platform), by proving that there is no employment relationship. A platform worker can also refute the legal presumption if the platform worker believes he/she is a genuine independent contractor. Member states must ensure that platforms make the necessary information accessible for the assessment.

Scope

The Directive uses a broad definition for digital work platform and platform work. The Directive’s definition of a “digital work platform” covers any natural or legal person who offers a commercial service (partly) remote via electronic means (such as a website or application) at the request of a user. The organization of the work performed by individual platform workers should be a necessary and essential part of the commercial service offered. Platform work is defined as work organized via a digital work platform that is performed on the basis of a contractual relationship between the digital work platform and the platform worker. Whether a contractual relationship exists between the platform worker and the customer of the service is not of interest in this respect. 

The above means that digital platform providers such as Deliveroo and Uber are easily covered by the definition because they offer a service at the request of customers of which the performed work is a necessary and essential part of the organization. In our view, platforms such as Temper and Helpling, which offer work to customers but which work is performed under the supervision of a customer, can also fall under the definition of a digital work platform. The interesting question for platforms like Temper and Helping is whether the platform ”controls” the work of the platform worker. For that, the five criteria as described above are relevant. These will have to be weighted in each individual case.

Decision making through algorithms

A second objective of the Directive is to make the use of algorithms by platforms more fair, transparent, and accountable. These algorithms are used to distribute tasks of platform workers and to monitor, evaluate and reward performance. The European Commission therefore considers it of great importance that it is clear how the algorithms work, for example in terms of allocating work and bonuses and imposing sanctions. Platform workers should be given the opportunity to understand and question decisions made by the algorithm. To realize the second objective, the Directive grants the following rights to platform workers:

• The platform is obliged to inform platform workers about the operation of the algorithm being used
• The algorithm may not process personal data that is not strictly necessary for the performance of platform work
• The platform is obliged to have the results of the algorithm and its effect on working conditions reviewed on a regular basis by a qualified employee. Sanctions for the platform worker must be explained in writing by the platform
• If an algorithm is modified or replaced, this must be discussed with the platform workers or their representatives

Transparency

Platforms will be required to report the work performed by platform workers in a member state to the competent authority. This will give the member state insight in (the amount of) work performed for the foreign platforms and in the conditions under which this work is performed. 

Conclusion

The Directive has far-reaching consequences for platforms and platform workers falling under the scope of the Directive. The Directive however still needs to be approved by the European Parliament and the Council of the European Union. Once the Directive has been approved, the member states have two years to implement it in national legislation. Therefore, it will take some time before the Directive has effect. We do not rule out however that the Dutch government will – in light of the Borstlap report on labour market reforms – act sooner and start implementing legislation before strictly required.

We will keep you updated of any developments. Please don’t hesitate to reach out to us in case of any questions on platform work meantime