About 28 million people across Europe are doing platform work. It’s easy to get started: Download an app, step onto a bike or into a car, wait for the algorithm to assign a task, and you’re off — delivering meals, offering passengers a ride or performing online tasks.
Deciding what employment rules should apply to them is going much more slowly. Platform work has become Brussels’ most divisive legislative file, exposing a yawning left-right gap between lawmakers and governments over how to treat the so-called gig economy.
The file has become a nightmare to deal with for all involved and is still bogged down in tricky negotiations in the Parliament and the Council, a year after the European Commission’s proposal. It isn’t clear that either institution will fix its own positions, let alone be able to find a compromise to get the legislation on the European Union’s books.
Trade unions and left-leaning politicians are keen to extend employees’ rights to gig workers. The tech platform companies and right-leaning politicians warn that this destroys the flexibility that makes the work attractive.
The struggle to get a deal prolongs the pain for the gig workers who do want a clear job status and legal rights. It also exposes a legal gray area for work ordered by a platform where tasks are usually assigned by an algorithm.
A matter of control
The Commission’s proposal in December last year rested on the concept of control. If a platform exerted control over a worker, a gig worker was presumed to be an employee. Two out of five criteria were needed to define a gig worker: control over price, appearance, performance, organization of work and the ability to work for others.
Under the draft rules, up to 4.1 million platform workers were expected to be reclassified as employees instead of their current status as independent contractors. Applying the relevant labor laws and industry agreements, such as a minimum wage, would let these workers earn on average €121 more every year, the Commission estimates. The rules aimed to protect gig workers from exploitation, most of them being young and less able to negotiate for better conditions.
Then the file passed to the employment committee in the European Parliament where the left-wing S&D group took it over. The platform companies feared the worst. They weren’t disappointed.
Italian S&D lawmaker Elisabetta Gualmini removed the criteria altogether and reintroduced them in another part of the bill, more as voluntary guidance for national authorities when platforms object to a reclassification. It sparked fears that gig workers would automatically be presumed to be employees — something that, according to Gualmini, “was never in the text.”
Gualmini’s stance — and sympathy for trade unions — risked alienating the center-right lawmakers she needed to get a deal. The lead Renew lawmaker Lucia Nicholsonová branded the removal of criteria as a no-go, while EPP backbenchers dismissed the plan as one that would lead to “mandatory employment” and threaten gig workers’ flexibility.
There was no deal by the initial target date for a committee vote in October. Nor was there one by a second target date on November 30. The next one is scheduled for December 12. Gualmini tried to secure a deal in direct negotiations with Nicholsonová two weeks ago as Nicholsonová was poised to circulate proposals of her own.
Gualmini told POLITICO last week she has now reached a “complete and sure” deal but the vote is still one to watch — as (once again) Renew has asked for more time to double-check the text.
Out of time
Governments negotiating the text in parallel in the Council are also struggling with the list of criteria as the clock runs out.
The Czech Republic took the opposite approach of the Parliament, adding certain exemptions to the list of criteria that would reduce the number of gig workers reclassified as employees. It suggested excluding in some circumstances platforms that complied with collective labor agreements — essentially what some platforms have started doing after negotiations with workers’ representatives in some countries.
But the Czechs also failed to win agreement among other member countries in three attempts to vote it through at deputy ambassadors’ meetings — mainly due to opposition of seven EU countries, some with Socialist-led governments such as Spain and Portugal. “There are plenty of loopholes leaving workers vulnerable to the whims of platforms,” one EU diplomat said of the Czech’s latest text.
The Commission is also worried that its proposal is being hollowed out.
“We must not excessively dilute a draft directive which, we feel, is quite balanced. This directive must have substance,” Jobs Commissioner Nicolas Schmit warned in a statement to POLITICO. “If someone is in fact a worker, they get the benefits that come with it,” he said.
In what one EU diplomat called a “risky” approach, the Czechs also brought their text to EU employment ministers on Thursday — without a deal on the lower technical level. Ministers voted the text down, especially because Germany abstained, sending the Czechs back to the drawing board.
Facing hurdles
The difficulty that the Parliament and Council have in agreeing on their own views on the legislation foreshadows an even tougher path ahead.
Any negotiations between lawmakers and governments will be led by a country that is dead against the EU plans. Sweden takes on the Council presidency on January 1, the only EU country to object to the legislation in March, because it said this should be decided individually by national governments and not EU law.
After the Swedes, it’s Spain, which last year imposed a law reclassifying food-delivery couriers as employees, the first EU country to do so. That could also see negotiations go in a different direction — and it raises the question of whether a deal is still possible before the Commission and Parliament end their current mandates in 2024. Gualmini is the rare optimist, telling POLITICO that she expected everything to be wrapped up by the end of 2023.
Member countries then have a two-year deadline to enter the law into their rulebooks. If Gualmini is right, that would be the end of 2025. By then, there could be as many as 43 million gig workers in the bloc.
In the meantime, countries are doing their own thing. France, which was never a fan of reclassifying gig workers as employees, launched a social dialogue between platforms and workers this year. Belgium earlier this year rewrote its gig economy rulebook … with the EU criteria already in there.
Far from having common EU rules, gig workers operating just a few miles away, commanded by the same algorithm, will face very different rules for the same work.
This article has been updated.