Platforms and their presumptions of power

Whether the presumption of an employment relationship would mean an end to self-employment for platform workers is a false debate.

Delivery Platforms Europe—whose members include Uber Eats, Deliveroo and Glovo—has made no secret of its opposition to the European Union directive on improving working conditions in platform work currently under debate. The lobby has repeatedly said it fears ‘an increase in legal proceedings with disastrous consequences for jobs, restaurants and the economy’.

The European Commission proposes in this directive the presumption of an employment relationship. According to the companies, that does not respect the work of the self-employed. But what will change in practice, for employees or platforms?

The presumption of an employment relationship for platform workers does notmean that all workers will automatically be treated as employees as soon as they sign up with a platform. The fundamental value of freedom of contract means that if platforms want to hire people as freelances they can, and will continue to, do so. Whether this is desirable as a business model is another argument.

So how would a presumption of employment ‘kill’ self-employment? It is a legal mechanism which will be essential when examining a contractual relationship during a judicial or administrative procedure. The presumption of an employment relationship will be a tool for checking whether the performance of a contract really corresponds to the contractual definition chosen by the parties.

Two scenarios

Consider two scenarios. In the first, a platform hires all its workers on the basis of an employment contract, which would penalise those who are ‘truly self-employed’. The platform is presumed to be the employer of all workers who have employee status. Labour law applies, as do additional obligations under the directive, such as the prevention of risks related to algorithmic management.

The ‘truly self-employed’ who refuse to be treated in this manner will have to go to court to challenge their employee status. If judges take the employment presumption as a starting point for their analysis, workers will have to prove that they are indeed self-employed. They will potentially have to demonstrate that they freely set prices for their services, that they choose how they organise their work and its performance, and that exercising their freedom—notably by refusing to perform services—does not negatively affect them.

Judges can then decide, case-by-case, if workers such as these are indeed self-employed. This will ensure that the majority of the workforce benefits from basic labour-law protections, such as the rights to safe working conditions and access to collective bargaining.

In the second scenario, a platform hires all its workers on the basis of a service contract, which would penalise the ‘falsely self-employed’. The platform doesnot have employer status and all its workers are treated as self-employed. They are thus obliged to pay their own taxes and responsible for their own health and safety—the platform is not required to provide safety equipment or anticipate the risks workers may face while providing services.

Some workers who believe they should have employee status can challenge their self-employed status in court or by contacting the domestic labour inspectorate. Indeed, platform workers have been going to court for years already, with judges (mostly) ruling in their favour. Until now, the burden of proof has however been on the worker to demonstrate that he or she is in an employment relationship. If the presumption of an employment relationship is adopted, it will be up to the platform to demonstrate that there is no employment relationship. If the company succeeds, the worker will remain self-employed.

Almost impossible

In the absence of the presumption of an employment relationship, workers would still have to initiate legal proceedings or contact the labour inspectorate in this way. A recent study by the European Trade Union Institute on the platform economy at European level showed that more than 70 per cent of platform workers who made deliveries or transported people did not have a university degree. Migrant workers were disproportionately represented among platform workers in delivery or transport services, compared with those engaged in other types of activity.

Initiating legal proceedings is difficult enough in itself. Demonstrating that one is a worker, without having access to the algorithm or official documents on the operation of the platform, is almost impossible.

Not adopting the presumption of employment relationship would mean asking people who were within their rights to justify themselves before the courts when they faced an imbalance of power. It would mean allowing platforms to continue to exploit workers.

The presumption of an employment relationship would not end self-employment; rather, it would end impunity for platforms. Requiring platforms to demonstrate that they do not treat workers as employees would force them (finally) to be transparent and take responsibility for the way they organise work—to face, in other words, their legal and social obligations.