A.    Starting point in Germany

Why is the classification of employees relevant? In Germany, this has considerable consequences: These range from the applicability of employee protection standards (the classic: protection against dismissal) to potential criminal law consequences for the client who turns out to be the employer and has not paid social security contributions. Compliance with the legal framework is therefore highly relevant in this area.

B.    The European way

Such risks are increasingly becoming important also considering the European level. At the end of April, the national labor ministries adopted the compromise proposal of the European platform work directive. Once the draft has been formally adopted, promulgated and published, the member states have two years to transpose it into national law, likely in 2026. The directive pursued to resolve the missing clarification of employes (versus self-employed persons) in respect of crowdworkers. The directive is intended to give misclassified crowdworkers the benefit of employee protection and to protect the personal data of all crowdworkers. It clarifies the terms “platform work” and “intermediary”. It also stipulates a presumption of an employment relationship between the platform worker and the intermediary. All the person concerned has to do is provide factual evidence for employment. The intermediary can then rebut the presumption of an employment relationship. So far, official EU sources estimate that around 5.5 million out of 28 million crowdworkers are misclassified. Other sources estimate around 1.7 to 4.1 million. However, this does not set a new low bar ‘employee’ test for all purposes. The national definition of employee remains unaffected by the directive. In addition, the European legislator leaves it up to the member states to implement tax, social and criminal law. This might reduce the risk of wider liability and criminal responsibility.

C.    Responsibility of the Member States

The obligation of the member states to provide suitable guidelines regarding the correct classification of crowdworkers is a positive step. The competent authorities must make it clear in which case a crowdworker is an employee and what consequences the presumption, including rebuttal, has for the classification. However, the directive does not resolve the question of which crowdworkers are employees and which are self-employed. Rather, the current draft leaves it up to the member states to determine the employment status using suitable procedures that include local laws, collective bargaining regulations and customary law, and taking into account the (rebuttable) presumption in favor of employee status. In the directive, the concrete transposition of the presumption is deliberately left to the member states. The recitals merely provide the usual principles for this, such as effectiveness and efficiency. It will be interesting to see how member states variously implement systems for presenting and checking the evidence to presume an employment relationship.

D.    AI in the draft directive

It is also noteworthy that the draft directive includes provisions on the use of AI in the employment context. The new regulations mandate that the termination of a crowdworker must involve a human final decision and cannot be based solely on an algorithm or automated decision-making system. Although this prohibition aligns with the prevailing interpretation under the GDPR, which prohibits termination solely based on an AI decision as per Article 22 of the GDPR, the draft directive does not provide exceptions like the GDPR does (e.g., consent). The rules in the crowdworker directive clarify that such exceptions will not apply to crowdworkers. Additionally, crowdworkers are entitled to receive explanations for algorithmic decisions in individual cases.

E.    Conclusion

Since the Covid pandemic, platforms such as food delivery and driving services have become indispensable. A corresponding app is usually part of the standard smartphone repertoire. Of course, crowdworkers need protection, but treating everyone equally and forcing them into an employment relationship — even against their contractual will — does not do justice to the usual individual legal assessment of whether employment status truly applies to an individual. Member states should be carefully considering the consequences when transposing.