Towards the end of April, the European Parliament adopted the Platform Work Directive (the Directive). There are two key points of significance in the Directive: it seeks to clarify the employment classification of platform workers, and to regulate the use of algorithms and AI in human resource management.
Background
Platform workers, sometimes known as “gig workers”, are workers that offer specific services using online platforms to third parties, including individuals and organisations. Examples of platform workers include rideshare drivers, delivery agents for food delivery apps, app-based freelancers and those who find work through digital platforms.
The Directive forms one component of a suite of initiatives that the European Commission first adopted on 9 December 2021. The objective of them all is to enhance the working conditions associated with digital platform work and to foster the sustainable expansion of this sector, which estimates suggest will include 43 million workers across the EU by 2025.
Employment classification
The Directive aims to ensure the legal employment status of platform workers reflects their actual working conditions. The Directive will require member states to introduce a legal presumption that, where the facts indicate control and direction are present, a platform is an “employer”. The Directive no longer specifies the criteria for determining employment status and individual member states will be able to decide what constitutes “control” and “direction” in this context. If a platform wishes to rebut this presumption, it will have to prove that the contractual relationship was not one of employment.
Individuals who work through a platform legally presumed to be an employer will enjoy the labour and social protections associated with being a “worker”.
Use of algorithms and AI in human resource management
In a first for the EU, the Directive also regulates the use of algorithms and AI in human resource management. The Directive will prevent platforms from dismissing individuals based on a decision taken by an algorithm or automated decision-making system. Platforms will have to ensure that there is human oversight of decisions that directly affect individuals performing platform work.
The Directive also aims to improve the transparency and protection of the data used by algorithms and AI in several ways:
- Platforms will not be able to process certain types of personal data, such as personal beliefs, health status or private exchanges with colleagues.
- Platforms will have to provide information to workers and their representatives about how any algorithms work and how a worker’s behaviour affects decisions taken by automated systems.
- Platform workers and their representatives will have a right to contest automated decisions.
- Platforms will be obliged to provide information to national authorities on self-employed workers they engage. This will also apply to platforms that operate across borders.
The UK, of course, no longer needs to implement EU Directives, but platforms based in the UK, which operate in EU member states, will need to comply with the legislation introduced by those member states in which they operate. The Directive might also form part of the thinking on the way in which the UK government approaches the issues associated with platform work in the future.
