REPORTS

REPORT - 15 December 2021

How the EU Would Like to Regulate Work Through Digital Work Platforms

Vincenzo Tiani, 15 December 2021

On 9 December, the European Commission published a proposal for a directive whose aim is to improve the working conditions of people working through digital working platforms. To do so, it will promote transparency, fairness and accountability in the management of the algorithms underpinning the operation of platforms, with further attention to the processing of personal data.

The new approach introduced is the legal presumption that a worker whose work is controlled by the platform is to be considered an employee, beyond what is contractually agreed between the parties, when at least two of the five requirements of Article 4 are met:

(a) effectively determining, or setting upper limits for the level of remuneration;

(b) requiring the person performing platform work to respect specific binding rules with regard to appearance, conduct towards the recipient of the service or performance of the work;

(c) supervising the performance of work or verifying the quality of the results of the work including by electronic means;

(d) effectively restricting the freedom, including through sanctions, to organise one’s work, in particular the discretion to choose one’s working hours or periods of absence, to accept or to refuse tasks or to use subcontractors or substitutes;

(e) effectively restricting the possibility to build a client base or to perform work for any third party.

This legal presumption will also have the effect of reversing the burden of proof by putting platforms in the position of having to prove that, despite the existence of two or more of the elements listed, there is no effective relationship of subordination (Article 5).

More transparency

The other major twist concerns the algorithms that underpin the operation of platforms (Article 6). While discussions continue in Brussels on the European regulation on artificial intelligence, this directive builds on the AI Act and the GDPR by asking platforms to be more transparent. Workers should be told when a system is being used to automatically monitor their performance and for decisions that have an impact on their earnings or the time they have to work or even the termination of their contract. It should then be explained what actions are monitored and evaluated, as well as personal data, that have an impact on the worker and their contract.

This information should be presented at the latest on the first day of work “in a concise, transparent, intelligible and easily accessible form, using clear and plain language”, so that it can be easily understood by the worker. Personal data on their emotional or psychological state, their health as well as messages exchanged with other workers, including with platform workers’ representatives, shall not be processed.

Constant scrutiny of algorithms

The Commission is therefore asking Member States to ensure that platforms regularly monitor the impact of automated decisions. This control must be carried out by staff with the necessary skills, training and authority to ensure that there are no retaliations by the company in the event that the algorithm's work is challenged (Article 7). The employee may ask one of these staff members to explain the reasons behind a decision of the algorithm. The reasons must be presented in an official manner and can be contested by the worker. “The digital labour platform shall respond to such requests by providing the platform worker with a substantiated reply without undue delay and in any event within one week of receipt of the request” (article 8).

Workers may also be represented in court by associations, which may represent one or more workers together (Article 14). Platforms will also have to provide workers with tools for communicating with each other and with their representatives, with a guarantee that these communications will not be monitored (Article 15).

Obligations and sanctions

Platforms, every six months and each time a contract is modified, will have to inform the competent national authorities of the number of people using them for work and their contractual status, as well as the terms and conditions when established unilaterally by companies (Article 12).

The authorities competent to impose sanctions will be both the Data Protection Authority, for the relevant articles, and the national authorities competent for employment. The authorities are therefore asked to cooperate in exchanging the information they collect (Article 19). It will be up to each Member State to legislate on the sanctions provided for in the event of infringement of the Directive.

Future protection for other self-employed workers

To correct these and other shortcomings of self-employment, the Commission has published, in addition to the proposal for a directive, a public consultation to update the rules on competition and self-employed workers. The aim is to review those cases where self-employed workers are hired en bloc by third parties and, since they should in theory be considered as undertakings, they are uncertain if they can collectively demand better conditions, risking to infringe Art. 101 (TFEU).

The Commission therefore wonders whether greater clarity might be needed for the benefit of those self-employed workers who, in some cases, 'as a result of competition', find themselves having to work under inadequate conditions, not even being able to have recourse to collective bargaining as is the case for employees.

Next steps

The text will now be reviewed and discussed by the European Parliament and the Council, who will propose their own amendments and then agree on a final text. As this is a directive, it will then be up to the Member States to implement it through ad hoc legislation in their own systems within two years of its entry into force.

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