Gig economy workers set to receive employee rights under EU proposal

The European Union unveiled plans to improve conditions for the growing number of gig economy workers that could reclassify some as employees entitled to benefits, the latest setback for digital platforms that rely on independent contractors to deliver food and offer rides.

The draft rules outlined on Thursday by EU officials aim to clarify the labour status of people employed by app-based companies like ride-hailing service Uber and food delivery business Deliveroo.

App-based gig work platforms have boomed in the digital economy, especially during the Covid-19 pandemic. Gig work’s flexibility is a selling point for many, but workers also complain that they end up making less than minimum wage after their expenses are accounted for.

Under the rules, a platform that meets at least two criteria will be deemed an “employer” and people working for that firm will be reclassified as “workers” with the right to a minimum wage, paid vacation, unemployment and sick benefits, pensions and other benefits.

The criteria include whether an app decides pay levels; electronically supervises work performance; restricts a worker’s freedom to choose work hours, accept jobs or use subcontractors; dictates a worker’s appearance and conduct with customers; or limits the possibility for workers to build their own client bases or work for anyone else.

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