September 09, 2019 Issue: September 2019

EUROPEAN UNION - New EU Directive on Transparent and Predictable Working Conditions Will Give Gig Workers More Rights

By: André Zimmerman

On June 13, 2019, the Council of the European Union (EU) adopted the European Parliaments proposal for a Transparent and Predictable Working Conditions Directive – a direct follow-up to the proclamation of the European Pillar of Social Rights. The new law introduces new minimum rights, as well as new rules on the information to be provided to workers about their working conditions. The directive is designed to strengthen employee rights and improving working conditions by promoting more transparent and predictable employment, particularly addressing protection for employees in more precarious jobs, while aiming to limit burdens on employers and maintaining labor market adaptability.

While much of the directive is not too ground-breaking, and in many cases already reflected in German law and that of other Member States, some rules will notably affect the way online platforms operate in the EU. The main rules include:

  • a six-month limit to the length of probationary periods at the beginning of the job, with longer periods allowed only in exceptional cases.
  • significantly limiting the employers' ability to prevent side engagements, with a ban on exclusivity clauses and limits on incompatibility clauses.
  • more information on the essential components of the work in writing, at the latest on the first day on the job (rather than up to two months afterwards).
  • the right to know a reasonable period in advance when work will take place for employees with very variable working schedules determined by the employer, as in the case of on-demand work. This will be particularly important in the crowd-working environment where work patterns are mostly unpredictable. Also, Member States will be required to take measures to prevent the abuse of on-demand contracts.
  • the right to receive a written reply to a request to transfer to another more secure job with more predictable and secure working conditions.
  • the right to receive cost-free training that the employer has a duty to provide. This may become an issue if employers' training obligations are increased in response to employees requiring new skills in the face of technology impacting so many aspects of their work.
  • a rebuttable presumption of employee status and employee rights in specific situations. It may become much harder to defend misclassification cases and claims by gig workers for employee rights.
  • effective enforcement mechanisms and protection of employees from detriment or dismissal for exercising their rights will need to be put in place by the Member States.

Regulations such as the six-months maximum probationary period and the reasonable notice period for work-on-demand already are largely in line with current German law. Other regulations such as limiting the employers' ability to restrict side engagements are new for German employers and employees as well.

EU Member States will have until 2022 to transpose the new rules into their national legislation.

André Zimmermann

Orrick, Herrington & Sutcliffe LLP