Key Points – The Directive on Platform Work

On 24 April 2024, the Platform Work Directive was finally agreed. This Directive was introduced as a proposal in December 2021.  Agreement appeared to have been finally reached in December 2023, only to have collapsed after behind the scenes negotiations.  Finally, on 8 February, the European Parliament and Council struck a new provisional deal on the draft law.  On 11 March, the European Parliament confirmed the agreement on the Directive. 

The Directive must now be formally adopted by the Council. After its publication in the Official Journal of the EU, Member States will have two years to incorporate the provisions of the Directive into their national legislation. 

Platform work is a form of employment in which organisations or individuals use an online platform to access other organisations or individuals to solve specific problems or to provide specific services in exchange for payment. Deliveroo and Uber drivers are examples of platform workers.

This Directive is to provide protections for platform workers and regulate the area of platform work.  

Background to the Directive

Eurofound, European Foundation for the Improvement of Living and Working Conditions, describes platform work very clearly: 

“Platform work is the matching of demand and supply of paid work through an online platform using an algorithm. Three parties are involved in the matching process: the client demanding work, the platform which manages the algorithm and the person who provides the work through the platform. It is work based on the performance of individual tasks or projects rather than a continuous employment relationship. A larger task is usually divided up into smaller subtasks, or ‘micro tasks’, that are independent, homogenous and contribute to producing a specific output. These tasks are carried out separately, resulting in a widespread, even global, division of tasks.”  

Eurofound also notes that platform work has been dynamically developing over the last 15 years and is expected to continue to do so.  

The issues that arise in relation to platform working are as to the true employment status of the workers and the use of algorithms that lack transparency to manage workers. 

The Directive

Key provisions

The Directive contains provisions in relation to three areas: the status of platform workers, promoting transparency in algorithmic management in platform work and improving transparency in platform work.

Definition of platform work

The Directive provides that “ ‘platform work’ means any work organised through a digital labour platform and performed in the Union by an individual on the basis of a contractual relationship between the digital labour platform or an intermediary and the individual, irrespective of whether a contractual relationship exists between the individual or an intermediary and the recipient of the service.”   

“Digital labour platform” means any natural or legal person providing a service which is provided, at least in part, at a distance through electronic means, such as a website or mobile app; at the request of a recipient of the service; involves, as a necessary and essential component, the organisation of work performed by individuals in return for payment, irrespective  of whether the work is performed online or in a certain location; and involves the use of automated monitoring or decision-making systems.  The Directive provides that this definition does not include providers of a service whose primary purpose is to exploit or share assets or which allow individuals who are not professionals to resell goods.  This means that platforms such as AirBnB and Etsy are not covered by the Directive.

The status of platform workers

The Directive provides that “platform worker” means any person performing platform work who has an employment contract or is deemed to have an employment relationship as defined by the law, collective agreements or practice in force in the Member States with consideration to the case-law of the EU Court of Justice.

The question of the employment status of a platform worker is to be determined by each Member State in accordance with its law, collective agreements or practice.  Importantly the Directive introduces a presumption of an employment relationship.  Article 5. 1 provides that “the contractual relationship between a digital labour platform and a person performing platform work through that platform shall be legally presumed to be an employment relationship when facts indicating control and direction, according to national law, collective agreements or practice in force in the Member States and with consideration to the case-law of the Court of Justice, are found.”

This legal presumption is to apply in all administrative or judicial proceedings where the correct determination of the employment status of the person performing platform work is at stake. It does not apply in tax, criminal and social security matters unless the Member State applies it in law to such proceedings.

“Persons performing platform work” (which includes platform workers and anyone performing platform work irrespective of their employment status) will have the right to initiate proceedings to ascertain their correct employment status.  Also, where competent national authority considers that a person performing platform work might be wrongly classified, it must initiate appropriate actions or proceedings to ascertain the employment status of that person.

Obligation to give guidance 

Member States must, under Article 6, establish supporting measures to ensure effective compliance with the legal presumption including: developing appropriate guidance for workers, platforms and the social platforms on the understanding and implementing the legal presumption; and procedures for competent national authorities to “proactively identify, target and pursue” digital labour platforms which do not comply with the rules on the correct determination of employment status.

Management by algorithm – transparency and human oversight (Articles 7-11)

The Directive places clear limits on the ability of platforms to manage workers by algorithm. Included in these limits are the following provisions.

Limits on processing personal data

Digital labour platforms are forbidden to use automated monitoring or decision making in relation to certain data of platform workers, including processing personal data on their emotional or psychological state, and processing personal date to predict the exercise of fundamental rights, including the right of association, the right of collective bargaining and action or the right to information and consultation.

Transparency on automated monitoring or decision-making systems; human oversight of automated systems

Member States must require digital platforms to inform people performing platform work, their representatives and, upon request, competent national authorities, of the use of automated monitoring or decision-making systems.  Article 9 details the kind of information that must be included in this.  

Member States must ensure that labour platforms oversee and, with the involvement of workers’ representatives, regularly, and in any event every two years, carry out an evaluation of the impact of individual decisions taken or supported by automated monitoring and decision-making systems, on people performing platform work.  Article 10.5 provides that any decision to restrict, suspend or terminate the contractual relationship or the account of a person performing platform work or any other decision of equivalent detriment “shall be taken by a human being”.

Human review of decisions

Article 11 requires platforms to provide a human review of important decisions regarding people providing platform work. Member States must ensure that people performing platform work have the right to obtain a clear explanation from the digital labour platform for any decision taken or supported by an automated decision-making system without undue delay. Member States must also ensure that the platforms give people performing platform work access to a contact person designated by the platform to discuss and clarify the facts, circumstances and reasons having led to the decision. 

Health and safety (Article 12)

Digital labour platforms must carry out health and safety assessments in relation to platform workers. These obligations are detailed in Article 12. 

Information and consultation (Articles 13, 14)

Member States must ensure that information and consultation under the Information and Consultation Directive (Directive 2002/14/EC) with workers’ representatives by digital labour platforms also covers decisions likely to lead to the introduction of or to substantial changes in the use of automated monitoring or decision-making systems. Where there are no representatives of platform workers, Member States must ensure that labour platforms directly inform the platform workers concerned on decisions likely to lead to the introduction of substantial changes in the use of automated monitoring or decision-making systems.

Transparency on platform work (Articles 16, 17)

Member States must require labour platforms to declare work performed by platform workers to the competent authorities of the Member State in which work is performed.  

Remedies and enforcement (Articles 18-24)

Member States must ensure that people performing platform work, including those whose employment or other contractual relationship has ended, have access to timely, effective and impartial dispute resolution and a right to redress, including adequate compensation. Member States must introduce measures to protect people performing platform work from being penalised for attempting to enforce their rights under the Directive.

Collective bargaining in platform work (Article 25)

Member States must take adequate measures to promote the role of the social partners and encourage the exercise of the right to collective bargaining in platform work.

What’s next

The Directive must now be formally adopted by the Council. After its publication in the Official Journal of the EU, Member States will have two years to incorporate the provisions of the Directive into their national legislation. 

Key contacts:

For further information on this topic, please contact Evelyn Gilson, Partner, or Neil McCann, Solicitor.

This update is provided for information purposes only and is not legal or other advice.