Trade unions have been claiming victory now the EU parliament and council negotiators have reached an agreement on new legislation that will settle the employment status of gig workers.

The new EU directive on platform work gives EU member states a basis to determine the employment status of people working for the likes of Uber, Deliveroo and Temper in the Netherlands. It also establishes the first EU rules on apps and algorithm systems used by platforms to manage human resources.

The deal has to be formally approved by both institutions, then member states will have two years to incorporate the new law into national legislation.

In March, following a legal action brought by the FNV trade union, the Dutch Supreme Court ruled that riders working for meal delivery service Deliveroo (which has now left the country) were employees, not self-employed. Other ongoing cases concern taxi service Uber and temp agency Temper.

Under the agreement reached at EU level, workers will be presumed to be employees if their relationship with the digital platform fulfills at least two out of five indicators including a limit on pay, controls over what tasks they do, working hour restrictions, and rules on their appearance or conduct. EU countries will be free to add more indicators in national law.

When a worker claims to be employed, it will be up to the digital platform to prove that it is not the case, not the other way round. If a worker goes through the procedure, authorities will have to assess colleagues’ situations too.

New rules will also forbid platforms using apps or algorithms to manage human resources from processing certain personal data of workers, such as personal beliefs, private exchanges with colleagues, racial or ethnic origin, migration status, political opinions or potential trade union activities. Platforms will not be able to circumvent the rules using intermediaries.

Dutch Labour MEP Agnes Jongerius said in a reaction it is “is high time to change the game of the gig economy and make sure that this often exploitative labour market model does not spread to other job sectors.”

The legislation is a world first, despite “huge pressure from aggressive lobbying by big digital companies,” said Italian MP Elisabetta Gualmini, who was in charge of the negotiations. “This is ultimately about strengthening the European social model and setting a global social standard.”

Approval

Move EU, the group representing companies such as Uber, Bolt and Free Now in Brussels, said it is “deeply concerned” about the new directive and called on EU member states to “not approve an unbalanced provisional agreement which will create legal uncertainty for hundreds of thousands of drivers throughout the EU.”

Ludovic Voet, secretary general of the European trade union confederation ETUC, said the move “should be the beginning of the end for the wild west in workers’ rights”

“There is now responsibility on member states to properly enforce the measures agreed today if they are going to make a difference to the lives of 5.5 million platform workers,” he said.

There are currently 28 million platform workers in the EU and the number is expected to reach 43 million by 2025. According to the European Commission, around 5.5 million, including taxi and food delivery drivers, are registered as self-employed while in reality they perform tasks as if they were in a regular employment relationship.