The European Parliament has voted to adopt an amended version of a proposed platform worker directive, making it easier for gig workers across Europe to clarify their employment status and understand how they are being algorithmically managed.
Proposed by the European Commission (EC) in February 2022, the directive means millions of people working for gig economy platforms across Europe could be reclassified as workers rather than self-employed, entitling them to a much wider range of rights and workplace protections.
According to EC estimates, more than 28 million people in the European Union (EU) are involved in platform work, which will rise to 43 million by 2025. It also estimates that, if the directive is passed, about 5.5 million people working for the likes of Uber, Deliveroo, Amazon Mechanical Turk and others could see their employment status change.
Passed with 376 votes to 212 on 2 February 2023, the updated directive gives the Parliament a mandate for “trilogue” negotiations with the EC and Council of Europe, which will now have to agree on a final text between them.
Changes from initial text
The initial draft sought to establish a set of five “control criteria” to determine whether or not a platform is an “employer”. Under this version of the directive, if the platform meets at least two of these criteria, it will legally be viewed as an employer, and the workers will be automatically reclassified.
The criteria included whether the platform has a role in determining or limiting remuneration; whether it requires workers to follow specific appearance rules, such as wearing a uniform; whether it supervises the performance of work, including by electronic means; whether it restricts people’s freedom to organise their own work; and whether it restricts the possibility of people building their own client base or ability to work for a third party.
In December 2022, however, the Committee on Employment and Social Affairs (EMPL) – which is responsible for scrutinising the directive – voted in favour of a “compromise text”, removing the five criteria and replacing them with a general presumption of employment. This text is what MEPs voted to adopt on 2 February 2023.
The compromise text also introduced new algorithmic management measures, including further transparency and information requirements, regarding how automated systems are used, and the effect they have on workers’ employment relationships to the platforms.
Platforms will also be obliged to assess the impact of decisions taken or supported by automated monitoring and decision-making systems on working conditions, health and safety and fundamental rights.
“Workers dealing with algorithmic management and their representatives have to be informed in advance of all elements affecting working conditions and health and security at work, so as to give them the opportunity to understand the functioning of the algorithm and to collectively bargain on it,” wrote EMPL in its explanatory notes at the time.
“All decisions impacting on those terms are to be taken by human beings, and, in parallel, human oversights on decisions taken by the algorithm has to be granted. At the same time, platforms have to guarantee that the protection of data of people [using the] platform is fully respected and that the algorithm does not access or collect data which are not primarily linked to the performance of work.”
It added that because the disparate nature of platform work makes collectively organising more difficult, and because “unionising has been actively discouraged by some labour platforms who depend on bogus self-employment for their business model”, all applicable European employment and collective bargaining legislation will apply to platforms once recognised as direct employers.
James Farrar, director of Worker Info Exchange (WIE) – which was set up to help workers access and gain insight from data collected from them at work – said the amendments were a welcome step forward, but that it still falls short in a number of areas, such as the failure to define working time or compensation for excessive waiting time.
He added the proposed directive could also go further in banning predictive behavioural profiling and dynamic pay setting, as outlined in WIE’s recent policy brief from December 2022, but that Europe was now far ahead of the UK.
“Europe is now progressing light years ahead to develop an appropriate regulatory framework for digitally mediated employment while Brexit Britain regresses into the Victorian era,” he said, adding the UK government’s proposed anti-strike laws in combination with its Data Protection and Digital Information bill will see gig workers stripped of vital protections against unfair automated decision-making, including those against dismissals, suspensions, work allocation and pay deductions.
“Employers will have greater powers to resist data access and algorithmic transparency requests from workers and will be relieved of current regulatory requirements to conduct algorithmic risk assessment and engage in consultation with stakeholders.
“And with the government having failed to bring forward a long-promised employment bill despite publication of the Taylor Review in 2017, the future could not be bleaker for vulnerable workers in the gig economy yet could not be rosier for profiteering platform barons.”
Aggressive lobbying tactics
Elisabetta Gualmini, a Social Democrat Group (S&D) MEP and the European Parliament’s rapporteur on the directive who spearheaded the amendments, has condemned platforms’ lobbying tactics on a number of occasions.
In mid-January 2023, for example, she said the EMPL committee was able to agree on changes to the directive, despite huge pressure from the platforms: “We must not give in to aggressive lobbying by big corporations. We must ensure correct employment classification, based on the actual working conditions and transparency of algorithms that cannot remain black boxes.
Leïla Chaibi, La France Insoumise MEP
“Trade unions and worker representatives must be able to collectively bargain on platform working conditions. The burden of proof of the employment status must lay with the platforms.”
In a speech given immediately before the vote, Gualmini also accused platforms of “interfering with democratic processes”.
Responding to the European Parliament’s vote, Leïla Chaibi, a La France Insoumise MEP who leads the work of the left in the European Parliament Group on platform work, described the vote to update the directive as a rare win for workers.
“Lobbyists from Uber, Deliveroo and their allies worked until the 11th hour to undermine the directive, and even tried to get a deal that was worse for workers than the status quo,” she said.
“Thanks to platform workers mobilising and the hard work convincing MEPs across the political spectrum, this proposal is balanced and good. We scored a new victory with an ambitious proposal, in favour of workers – a rarity in the European Union.”
Against the amendments
In an article published by Euractiv on 25 January 2023, Benoit Le Bret, a partner at Gide Loyrette Nouel law firm in Brussels (which has advised Uber on European regulatory matters), wrote that the amended directive “smacks of legislative overreach, risks sidelining this promising new mode of work and would curtail opportunities for workers at a time of high economic tension”.
He added: “The proposal of the European Parliament casts aside the European Commission’s original, legally safer and balanced proposal and is not a sensible or practical way forward.”
The European Tech Alliance (EUTA) – which represents 29 tech companies from Europe, including platforms such as Bolt, FreeNow and appJobber – said it was concerned that the updated directive would create legal uncertainty for European businesses, adding that it would not grant independent platform workers the necessary protections.
“The debate focused on a few well-known companies and didn’t acknowledge the impact on European businesses,” it said on Twitter.
“When it comes to the classification of workers, we recommend mirroring the criteria from the European Court of Justice (ECJ) case B versus Yodel, [which stipulated that the courier was self-employed rather than a worker, given their independence and lack of subordination to the firm].
“As the discussion continues with the EU member states, the EUTA invites policymakers to adopt a more holistic approach which would better protect independent workers and allow European online services to flourish.”
However, in commentary published in the wake of the case, UK-based Crossland Employment Solicitors noted the decision “turns on a very specific set of facts and the ECJ’s analysis seems focused on the contractual terms rather than socioeconomic realities”.