The matter of work on digital platforms is becoming one of the cornerstones of the labor law debate in Europe. This is not only because more than 28 million people are working on digital work platforms in the European Union, which number is expected to reach 43 million in 2025 (source: Council of the European Union), but also because there is considerable fragmentation in the approach to digital platform work of EU member states and, above all, little attention has been given to the employment conditions of workers, who are classified in most countries as self-employed and therefore usually lacking the protections an employment relationship would otherwise provide.

In Italy, the issue of digital platform work was the subject of a significant legislative intervention in 2019 with Decree-Law no. 101 (converted into Law no. 128 of November 2, 2019) coming into force, which introduced a new type of “work organized using a digital platform” and provided for a specific set of protections for such workers (such as a written agreement, the obligation to provide information on the working conditions, including safety at work, the criteria used to determine remuneration and the obligation to provide insurance coverage against accidents and occupational diseases).

Also, the recent Italian Transparency Decree no. 104/2022, which implemented EU Directive no. 1152 of 2019 aimed at ensuring transparent and predictable working conditions for European citizens, provides for a special section dedicated to information obligations in the case of the employer’s use of automated decision-making or monitoring systems used to provide relevant information for the purposes of recruitment, management and termination of the employment relationship.

Again, within the EU framework the proposed EU directive published on December 9, 2021, is currently fueling the EU debate. The aim of the proposed directive is clear: to fight precarious forms of employment in the context of work organized through digital platforms and to determine, based on a set of predetermined indexes, whether the digital platform can be considered an “employer.”

To summarize, a digital platform is legally considered an employer if at least two of the following criteria are met: it determines the level of remuneration, supervises the execution of work by electronic means, sets restrictions on the freedom to determine working hours or to accept and refuse assignments, establishes binding rules with regard to behavior towards clients and in the execution of work, and restricts the possibility of building up a client base or performing work for third parties. 

If at least two of the above criteria are met, work rendered through digital platforms and through the use of algorithms is considered an “employment relationship” which entails the application of an employer’s obligations in accordance with national legal systems.  

In Italy, this would fall under the aforementioned Law no.128 of 2019, and would undoubtedly imply the stringent application of the rules of subordinate employment as governed by the Civil Code and the binding labor law: in other words, clear rules on working hours, paid leave, remuneration proportionate to the quantity and quality of work, insurance coverage, pension, unemployment and health coverage and protection in case of dismissal.

Under German law, the current draft of the EU directive establishes unsuitable criteria for differentiating between employees and self-employed persons. As a result, an employment relationship is assumed not because the person is subject to the employer's right to issue instructions under German law and is operationally integrated, but because the contract was concluded via a platform. From the German perspective, this is not in line with binding regulations, since under German law the status of employee is determined by way of an overall assessment. The criteria of “influence on the amount of remuneration” and “control of work performance” are also common for service or work contracts and are not suitable demarcation criteria.

Overall, the presumption of employee status should automatically occur in all judicial or administrative proceedings, even if there are no doubts at the factual level. The duty of proof envisaged for a platform contradicts the official investigation principle applicable under German law, including in administrative proceedings. 

If a court or administrative decision confirms employee status, all labor (protection) laws apply, e.g.: the obligation to record working hours, maximum working hours, holiday entitlements, continued payment of remuneration and protection against dismissal. Social security contributions of approx. 40% must also be paid. In the event of an administrative or court decision establishing the status of an employee, legal remedies should not have a suspensive effect. In practice, this would lead to immense problems in Germany, especially in the case of a possible reversal. 

From the German perspective, the creation of additional hurdles will make it considerably more difficult and unattractive for genuine self-employed persons to work within the EU. 

Furthermore, if digital platform work becomes more regulated, Europe may become less attractive to potential workers not wishing to enter into an employment relationship.