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Platform Workers to be Presumed Employees Under New EU Proposal

new draft report to the European Parliament introduced a framework for determining platform worker status under which all platform workers are presumed to be employees. The draft also recommends regulating automated decision-making software used in the workplace. 

“Rebuttable presumption” of employment: Under the draft, any platform worker will be automatically classified as an employee. Specifically, the draft creates a “rebuttable presumption” of employee status, which platform employers would be required to overcome to prove their workers are contractors. Platforms would also be required to declare their workers’ contracts with the relevant authority.  

The proposal revises the original approach under which such a presumption was only triggered if two of five criteria are met. Under the proposal, the five criteria would be expanded to eleven.  However, none of the eleven would be binding, as the report noted the “criteria risked not being exhaustive.” Notably, the draft report also mentions measures to encourage workers to unionize by enabling them to freely communicate with each other. 

The proposal would create new regulations for software management, proposing all essential decisions related to a job – such as terminations and working schedules – be made by a human instead of an algorithm. Significantly, the proposal would also extend this obligation of human review to all workers who interact with algorithms in their work environment, including, for example, retail and warehouse workers. 

Under the draft, all data used to assess workers’ performance would be subject to collective bargaining and therefore open to trade union access. Tom Hayes, Director of HR Policy Global and BEERG, pointed out the potential risks in EU: Parliament wants to up the ante on algorithm bargaining. 

Next steps: The proposal is still a long way away from becoming law. After a draft Directive is published by the EU Commission, it needs to be examined by the European Parliament, and by the Council of Ministers representing the Member States. Once the Parliament and the Council have decided on their positions, the Commission, Council and Parliament huddle to negotiate a final text. Meanwhile, the draft sends a strong signal about how millions of platform workers could be regulated in Europe, and the policy may be benchmarked around the world, including the United States, where expanding the social safety net for contractors continues to be a major policy issue.

Published on: May 20, 2022

Authors: Wenchao Dong

Topics: Employment Law, The UK and European Union