Parliament adopts Platform Work Directive

• New rules to correct false self-employment

• Workers cannot be fired based on a decision taken by an algorithm

• Platforms forbidden from processing certain types of personal data

On Wednesday, MEPs approved new rules aiming to improve the working conditions of platform workers.

The new rules, agreed on by the Parliament and the Council in February and adopted with 554 votes in favour, 56 votes against and 24 abstentions, aim to ensure that platform workers have their employment status classified correctly and to correct bogus self-employment. They also regulate, for the first time ever in the EU, the use of algorithms in the workplace.

Employment status

The new law introduces a presumption of an employment relationship (as opposed to self-employment) that is triggered when facts indicating control and direction are present, according to national law and collective agreements, and taking into account EU case law.

The directive obliges EU countries to establish a rebuttable legal presumption of employment at national level, aiming to correct the imbalance of power between the digital labour platform and the person performing platform work. The burden of proof lies with the platform, meaning that it is up to the platform to prove that there is no employment relationship.

New rules on algorithmic management

The new rules ensure that a person performing platform work cannot be fired or dismissed based on a decision taken by an algorithm or an automated decision-making system. Instead, digital labour platforms must ensure human oversight on important decisions that directly affect the persons performing platform work.

Transparency and data protection

The directive introduces rules that protect platform workers’ data more robustly. Digital labour platforms will be forbidden from processing certain types of personal data, such as data on someone’s emotional or psychological state and personal beliefs.

Quote

Rapporteur Elisabetta Gualmini (S&D, IT), said: “With this directive, up to 40 million platform workers in the EU will have access to fair labour conditions. This historic deal will give them dignity, protection and rights. It will correct bogus self-employment and prevent unfair competition, protect true self-employment, and introduce ground-breaking rules on algorithm management. This will become a real benchmark at global level. I am proud to say: Europe protects its workers, its social model and its economy.”

Next steps

The agreed text will now have to be formally adopted by the Council, too. 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.

Background

European Commission analysis from 2021 found that there are more than 500 digital labour platforms active and the sector employs more than 28 million people – a figure expected to reach 43 million by 2025. Digital labour platforms are present in a variety of economic sectors, be it “on location”, such as ride-hailing and food delivery drivers, or online with services such as data encoding and translation.

While most platform workers are formally self-employed, about 5.5 million people may be wrongly classified as self-employed.

With the adoption of this legislation, Parliament is responding to citizens’ expectations on inclusive labour markets and digital innovation to strengthen the social and sustainable economy, as expressed in proposals 13, 13(5), and 35(1)(3) of the conclusions of the Conference on the Future of Europe.