Europe inches closer to insisting gig workers are treated as employees
- Reference: 1702544166
- News link: https://www.theregister.co.uk/2023/12/14/europe_gig_workers_employees/
- Source link:
The European Council and the European Parliament on Wednesday [1]announced a provisional agreement, after two years of negotiation, designed to clarify the employment status of such workers. These are the people who sign up to apps to deliver takeout, do DIY work, and perform other tasks for users.
"Currently, the majority of the EU's 28 million platform workers, including taxi drivers, domestic workers and food delivery drivers, are formally self-employed," explained Yolanda Díaz, Spanish vice-president and minister for work and social economy, in a statement.
[2]
"Nevertheless, a number of them have to abide by many of the same rules and restrictions as an employed worker. This indicates that they are in fact in an employment relationship and should therefore enjoy the labor rights afforded to employees under national and EU law."
[3]
[4]
According to a 2021 European Commission [5]analysis , most of the 28 million platform workers in the EU are self-employed, but about 5.5 million may be wrongly classified.
Geo-block blocking blocked
The European Parliament on Wednesday decided – for now at least – not to ban geo-blocking to accommodate the interests of the media industry.
Geo-blocking – limiting online access to content or services by region – in most contexts was disallowed in 2018 as a cross-border trade barrier, but entreaties from the film and video industry have convinced lawmakers that an exception may be warranted.
While EU lawmakers generally want geo-blocking rules to be better enforced and to better reflect consumer expectations, they also [6]argue that "extending the scope of the rules to the audio-visual sector would result in a significant loss of revenue, threaten investment in new content, reduce the cultural diversity of content and decrease distribution channels, and ultimately raise prices for consumers."
The European Commission expects to examine the issue further and issue another report on the subject in 2025.
The [7]directive [PDF], which still needs to be adopted by EU member states, provides guidance on how to determine the employment status of those working for digital platforms, and constrains the use of algorithmic systems for worker management.
It also sets rules that mean digital platform workers will be considered employees if at least two of the following five conditions are met:
If the employer caps worker payments;
If the employer supervises worker performance, directly or electronically;
If the employer has control over the distribution or allocation of tasks;
If the employer has control over working conditions and working hours;
If the employer limits discretion about how work is done, appearance, or conduct.
The agreement also requires human decision making when employers dismiss staff or suspend their access to platforms, to prevent the unchecked use of algorithmic personnel management.
Notably, it forbids the use of personal data for:
Creating emotional or psychological profiles;
Analyzing private conversations;
Predicting union activity;
Inferring protected characteristics like racial origin or political opinions;
Using biometric data, except for authentication.
The European Trade Union Confederation (ETUC) hailed the provisional agreement, while warning that the text waits final edits and implementation.
"We still need to scrutinize the final text of this agreement closely, but what is clear is that there is a genuine attempt to address the grave problems that working people face," declared ETUC confederal secretary Ludovic Voet in [8]a statement . "Platform companies have forced delivery riders, taxi drivers and other workers, including carers and cleaners, into false self-employment in order to avoid paying holiday pay, sick pay or social security."
The struggle over wages and labor practices has been a constant as long as there have been workers and employers. The digital battlefront opened around 2005 with the emergence of cloud platform services like Airbnb, Amazon Mechanical Turk, Lyft, and Uber, which classified workers as independent contractors and thus avoided paying for worker benefits and employment taxes.
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The employment status of digital platform workers is of enormous financial consequence – both to workers and to the platforms that hire them. While various national tax and employment agencies offer [10]guidance about worker classification, their respective tests to determine employment status, and associated labor laws, are not always clear or well-suited to address digital platform work.
In the US, digital platform companies have been largely successful in preserving their ability to classify workers as independent contractors. In California, for example, DoorDash, Lyft, and Uber waged a successful ballot measure campaign and subsequent [11]court battle to convince voters to support their labor practices.
Lyft and Uber did not immediately respond to requests for comment. ®
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[1] https://www.consilium.europa.eu/en/press/press-releases/2023/12/13/rights-for-platform-workers-council-and-parliament-strike-deal/
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2ZXrgVukNA7D89yBABjv1FAAAAMg&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44ZXrgVukNA7D89yBABjv1FAAAAMg&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33ZXrgVukNA7D89yBABjv1FAAAAMg&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A52021SC0397
[6] https://www.europarl.europa.eu/news/en/press-room/20231208IPR15768/meps-want-to-revise-eu-geo-blocking-rules-to-eliminate-remaining-barriers
[7] https://data.consilium.europa.eu/doc/document/ST-14450-2021-INIT/en/pdf
[8] https://etuc.org/en/pressrelease/platform-deal-should-end-wild-west-workers-rights
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44ZXrgVukNA7D89yBABjv1FAAAAMg&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[10] https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee
[11] https://www.npr.org/2023/03/14/1163301631/california-court-says-uber-lyft-can-treat-state-drivers-as-independent-contracto
[12] https://whitepapers.theregister.com/
Let them game the edge while they can. As long as no new rideshare service can screw everyone while pretending to only be a website/facilitator, I'll be happy.
Eh, Uber ? How's that for "disruptive" ?
Not difficult
Germany already has a fairly simple law against fake self-employment.
One of the main criteria is if over 80% the income is from one "client" then you're actually employed.
They do properly enforce it, with not just a fine but also back-pay of all social security contributions for the employer.
No chance this side of hell freezing over that the UK will introduce similar legislation.
Re: Not difficult
This would completely screw deliveroo over where you can actually, as a worker, have anyone work for you! The person that appears on the app as your delivery person may not actually be the person that arrives at the door
Will also screw up Amazon too, but I'm happy with that
Re: Not difficult
"One of the main criteria is if over 80% the income is from one "client" then you're actually employed."
I doubt it's as simple as that. On that basis if a plumber comes to service your boiler then unless he's somehow simultaneously getting at least a quarter of the amount you're paying him from somewhere else he's your employee at the time. If a jobbing gardener spends a whole day working on your garden is he getting the equivalent of quarter of a day's gardening pay somewhere else?
Like you, I doubt this sort of legislation would be introduced in the UK. The equivalent already exists here: it's called IR35. It means that HMRC can take their pound of flesh from the individual worker, no need to take on larger businesses who might be better equipped to fight back.
If said plumber is registered, he already has a company. If he DIYs for you, he'll be DIYing for many other people if he is to make ends meet.
Not sure that simile applies. Unless said plumber is actually offering his services on PlumbersRUS, and you subscribe to get his service which PlumbersRUS oversee and guarantee their prices, paying a part to said plumber who also subscribed to get the gigs.
Then yes, but otherwise, not really.
I think.
Re: Not difficult
80% is too vague.
I'm a self employed consultant working through a ltd company in the uk.
My largest customer is normally about 40% of my turnover. In the past, I used to sell software too. A large order could easily take that 40% to 85%. Nobody doubts my self employment.
Re: Not difficult
So, IT Contractors should not exist in this scenario?
I've been working for the same "client" on several projects for the last year now. I know this is not the same as a "gig worker" but if you go by a lot of the criteria, then I actually do. Also, if I took on a contractor to help me convert a barn, for example, and gave them 18 months of work (which I will be supervising, directing and controlling - I'm not going to just let them build it how and when they feel like) then am I supposed to "employ" them? Pay their pension? Give them sick pay? Make them redundant at the end of the 18 months? It's all a bit of a mess.
So, actually it IS difficult and blanket rules like this just catch people like me who are quite happy running a business and working for someone for 3 / 6 / 12 months at a time.
Re: Not difficult
One of the main criteria is if over 80% the income is from one "client" then you're actually employed.
This is only to protect big consultancies that operate the same business model. As in an employee of big consultancy will work for extended period of time for consultancy's client, but consultancy will be able to make profit from their worker's work. However, if worker decides to cut the middleman and work with the client directly, they are classed as "fake self-employed" suddenly and can't make profit.
This is quite corrupt law.
I'd hope that, unlike IR35, such legislation also allows for the right to be in business in one's own right.
enormous financial consequence – both to workers and to the platforms that hire them.
Not to mention their customers, who will be the ones who end up paying for it in increased prices.
My bet is that the larger legitimate companies will pay up and pass on the costs, and there'll be an increase in the number of smaller companies which will keep prices low by paying under the table. That won't help workers or customers.
"Not to mention their customers, who will be the ones who end up paying for it in increased prices."
Maybe - but it wasn't very long ago when nobody had their fish and chips delivered from the chippy that's only 100 yards down the road. When people have to pay the full cost of personal delivery they'll get off their arses and walk to the shops and we'll all be better off for it.
It might not be immediately visible, but we're paying for the current situation: the costs the "employer" currently dodges fall back on the rest of us in the end.
It looks good but, assuming it goes through, I predict many years of the platforms gaming the edges of those conditions and protracted court battles before the intent of the legislation is achieved.