In December 2022, the European Parliament’s Employment and Social Affairs Committee adopted its report on the European Commission’s proposal for a directive to improve working conditions in platform work. The report came as a compromise solution after months of intense debates in the European Parliament, and overall represents a strong step forward towards a more level playing field for companies and better working conditions for workers.
The European Parliament text includes a recital recalling that “in its Action Plan for the Social Economy, the Commission has recognised the important role of social economy entities as an example of participation-governed enterprises, using digital platforms to facilitate citizen participation and the sale of locally produced goods and services, with the aim of achieving better working conditions for their members. Cooperatives could therefore be an important tool for the bottom-up organisation of work on platforms and could foster competition between platforms. Member States should protect and promote cooperative enterprises and small enterprises by means that aim to safeguard employment and ensure their capacity for sustainable development and growth”.
The text of the report defines workers’ representatives and representatives of persons performing platform work in a way that includes cooperative forms of enterprise.
It presumes that they are “workers who are not free from the control and direction of the digital work platform in relation to the performance of work, and those who do not work in traditional liberal professions”. If a digital work platform argues that the worker is nonetheless self-employed, the burden of proof is on the platform.
The report also recognises that “the use of subcontracting chains has been used as a way of circumventing the application of labour law to platform workers”, and sets out measures to avoid situations where platforms manage to evade the responsibilities of their employers through the use of subcontractors.
With this report, the European Parliament wants to take a significant and progressive step in the regulation of platform work. According to European Commission estimates, 28 million people in the EU are working through digital work platforms, and this figure will reach 43 million by 2025. Millions of workers are currently misclassified as self-employed, which deprives them of more social protection and labour rights, and disadvantages companies that do comply with relevant labour legislation.
Stricter European regulation of digital labour platforms is important for cooperative and social economy enterprises as a way to ensure a level playing field and their competitiveness in the single market.