Protecting Gig Economy Workers in the EU: the Platform Work Directive
According to the European Council, 28 million workers were employed through one or more digital labor platforms in 2022. Examples of digital platforms include rideshare platforms such as Uber, and work conducted through these platforms is often referred to as the “gig economy.” It is expected that this number will reach 43 million in 2025.
To protect gig economy workers, the EU issued the Platform Work Directive, which helps determine the correct employment status of people employed through these platforms. It also sets guardrails for the use of algorithm systems in the workplace, which can do things like match workers to tasks or track and evaluate a worker’s performance.
Worker classification
The directive recognizes that many gig economy workers are actually in an employment relationship and are therefore entitled to the same protections afforded to employees in more traditional working arrangements. Yet the European Council believes that state-level approaches to platform work are “developing unevenly” in the EU, leaving many of these workers exposed to unfair labor practices.
The Platform Work Directive establishes a rebuttable legal presumption regarding the relationship between a platform and the workers using that platform. It holds that this relationship is an employment relationship if the platform controls things such as the workers’ pay, work schedules, or performance evaluations. To rebut this assumption, an organization must be able to demonstrate that these workers are not in an employment relationship.
Reliance on algorithms
To comply with the directive, companies must also be transparent about how work assignments, evaluations, and other management tools are affected by automated monitoring and decision-making systems.
Importantly, the EU directive forces organizations to oversee the major decisions made by automated systems. For example, qualified staff would be required to review an account suspension issued by an automated decision-making system.
Additionally, digital platforms are now restricted from processing certain types of personal data, which include data on trade union activity, as well as data on racial or ethnic identity, migration status, political and religious beliefs, and health status. Biometric data, other than that used for authentication, is also protected.
The EU Platform Work Directive went into force in December 2024, and member states have until December 2, 2026, to implement it in their own laws.
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Source: European Council
