Key challenge: platform work is not homogeneous
ed* Nr. 01/2022 – Chapter 3
A study on business models commissioned by the European Commission found that around 80 per cent of digital labour platforms exclusively employ or place self-employed workers. Only a minority works with employees. These are almost exclusively locally bound delivery services, a sector for which various courts in the Member States have repeatedly (re)qualified the status of employed persons in favour of a dependent employment relationship.1 The predominance of employment by people classified as self-employed means that many workers in the platform economy fall through the social safety net. For example, only a small percentage of platform employees have unemployment insurance. According to one study, 97 per cent of platform workers are not covered by unemployment insurance. Similar conditions are encountered in other branches of social insurance, such as coverage in the event of illness or old-age pension. An exception is insurance against accidents at work and occupational diseases: 23 per cent of digital labour platforms already offer appropriate coverage to their self-employed platform workers. However, the study expressly leaves open whether their level is comparable with that of insurance against occupational accidents for employees.2
Similar findings can be seen in a study commissioned by the European Parliament, which concludes that platform workers also face a high risk of precarious employment, regardless of their employment status, and often have inadequate social protection.3
Thus, platform work poses a variety of challenges for social security. In addition, it is uncertain whether the classification as self-employed is actually correct or whether platform workers are in a relationship of dependency, receive instructions and are controlled. The deficiencies in labour and social protection can also lead to distorted competitive conditions vis-à-vis other (traditional) companies that comply with the statutory obligations for employees and for which corresponding control mechanisms exist.
Against this background, the European Parliament has adopted a resolution on platform work. This highlights the often poor working conditions of platform workers, regardless of their employment status. Thus, in addition to providing a healthy and safer working environment through work and protective materials, MEPs also call on EU Member States to ensure platform workers have access to benefits in respect of unemployment, accidents at work , long-term care, disability and illness, as well as health and retirement benefits.4
Advantages for companies operating across borders
Platform work is a new form of cross-border work that often defies national regulations. In order to exploit their potential while ensuring the social protection of employees, the need for a European regulatory framework was seen early on.
Ultimately, the digital labour platforms themselves will also benefit from a European regulation. Due to legal fragmentation, they have to comply with a large number of different national laws and court rulings, which affects their expansion in the EU market. Furthermore, fair competitive conditions, e.g. by avoiding bogus self-employment, are also in their interest. This creates a framework that enables competitive advantages to be achieved through innovation.