EU lawmakers push for better protection of bogus self-employed

The European Parliament's committee on employment and social affairs wants self-employed people to have access to collective bargaining. [Julien Warnand (EPA-EFE)]

EU lawmakers quizzed the European Commission executive vice-president, Margrethe Vestager, about new guidelines that would enable self-employed people to seek the protection of collective bargaining agreements, with both sides agreeing that such a right should be guaranteed.

A draft of the new guidelines was proposed by the Commission in December 2021 in parallel with a proposal for a new directive on platform work.

After a period of public consultation that ran until the end of February, Vestager joined the European Parliament’s committee on employment and social affairs on Monday (28 March) to hear EU lawmakers’ views on the guidelines.

“Not genuinely independent”

The guidelines concern the application of EU competition law to self-employed persons who have little influence over their working conditions, either because they are in a situation comparable to workers, or because they are in an imbalanced negotiating position.

“We know that some self-employed lack the bargaining power to influence their working conditions. And collective bargaining is a very important tool to change this,” Vestager said.

“Self-employed who are in a similar or comparable position to workers cannot be seen as genuinely independent,” she added.

According to the draft guidelines, self-employed people are considered to be in a comparable position to workers in three cases.

First, if they are providing their services through a digital platform; second, if they work side-by-side with normal workers; and third, if they are economically dependent on predominantly one counterparty, meaning that at least 50% of their work-related income stems from a single counterparty.

As self-employed persons are considered “undertakings” and are therefore similarly treated as companies under EU competition law, they currently risk breaching EU competition law if they enter collective bargaining agreements.

The guidelines proposed by the Commission are clarifying that self-employed persons who have little influence over their working conditions will not be held back by EU competition law if they enter collective bargaining agreements.

“The Commission and the European Parliament share the goal of ensuring that EU competition law is not standing in the way of justified collective bargaining by self-employed people,” Vestager said.

“I find this topic to be really important because it cannot be that we’re looking away while rights that we fought for hundred years are just disappearing,” she said.

Offline self-employment

While in the public debate, the issue of working rights for self-employed people mostly revolved around platform workers like delivery drivers, Vestager stressed that the problem also appeared offline.

Dennis Radtke, a member of the European Parliament for the centre-right European People’s Party group, welcomed the fact that the Commission was not only looking into the status of self-employed online platform workers, as it does with the platform workers directive, but also into the status of those who work offline.

“We have to find the right balance between business freedom on the one hand and a certain amount of protection for certain sectors on the other hand,” he said.

The Social Democratic MEP Agnes Jongerius, meanwhile, argued that there should be no exceptions for special arrangements in the guidelines that might create loopholes for employers to evade collective bargaining.

“The right to collective agreements must be guaranteed to all workers, regardless of their employment status,” she said.

More specifically, she criticised the fact that micro-enterprises are excluded from the guidelines, saying that this might lead to a long chain of sub-contractors that evade collective bargaining.

Vestager argued that the Commission would not consider micro-enterprises, which are defined as employing fewer than 10 persons and having an annual turnover of less than €2 million, as having a high negotiating power over self-employed workers.

Moreover, she stressed, the new guidelines would not create any new rights. Instead, they are intended to lower the barriers for self-employed workers to pursue their rights for collective bargaining.

The Commission is currently adapting its guidelines to the feedback it received during the public consultation process, with a view to adopting the new guidelines later this year.

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[Edited by Zoran Radosavljevic]

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