The originality and the success of web platforms raise the essential question of their workers’ status. Indeed, the gig economy is currently founded on conflicting legal and economic features:
- On one side, independent work is favoured, based on a crowd force with flexibility and a free organization at a lower cost.
- On the other side, employee status stays attractive through the rights and warranties it provides (Labour Code provisions, minimum wage, contribution to certain schemes, social security, unemployment…).
In most cases, platforms choose to conclude a service provision contract with individuals. However, this choice raises practical difficulties because of the conditions of its execution which can sometimes lead to its requalification into an employment contract.
In the absence of a specific position from the European or French institutions, case law is starting to set the scene (i). Nevertheless, so far court decisions are still inconsistent and there are more questions than answers. The legislator is called for action to provide a real and distinct status to this new form of employment to secure the gig economy sector (ii).
Overview of French law
Current situation of platforms’ workers is subject to two opposite dynamics. On one hand, the legislator encourages independence. On the other hand, the Supreme court tends to favour the existence of a subordinate relationship and thus of an employment contract.
A Law of 2016 took into consideration this emerging market and incorporated a new chapter into the Labour Code dedicated to platforms independent workers. However, its provisions only created a social responsibility for the platform. Thus, under certain conditions and limits, the platform must pay contributions to protect its workers against work-related accidents and illnesses, and for vocational training.
Furthermore, the Labour Code also provides for the right for any worker to form or join a trade union and the right to strike.
By creating a specific protection for platforms’ workers inspired by the rules existing for employees but limited to certain issues only, the legislator clearly demonstrated its willingness to create a specific and unique regime. Thus, on top of the employee and independent status, there is room for a third status.
However, despite these provisions, some claimants continued to ask for the requalification of their relationship with the platform into an employment contract.
The number of cases concerning platforms workers considerably increased in recent years.
The analysis of first instance judges’ decisions leads to identify a general trend for not requalifying the relationship between the worker and the platform into an employment contract considering the large freedom enjoyed by workers in the organisation of their schedule (no control of working hours, no obligation to log on the app, complete freedom to decide if and when individual wanted to work…).
But, a decision rendered by the French Supreme court in November 2018 marked an important break with this trend. In a case against Take Eat Easy (a food delivery platform), the Supreme Court ruled that the working conditions of the supposed independent worker were, in fact, hiding an employment relationship (Supreme court, November 28th, 2018, n°17-20.079).
To substantiate its decision, the Supreme court first reminded that judges are not bound by the contract’s qualification given by the parties (Supreme court, March 4th, 1983, n°81-11.647).
The Supreme Court then examined if a subordination link could be demonstrated as this is mandatory to demonstrate the existence of an employment contract. The subordination concept means that the employer has the power to give instructions to the employee, to control him and even to sanction possible breaches of duties (Supreme court, November 13th, 1996, n°94-13.187).
To do so, the Court referred to the concept of “integration into an organised service” traditionally used by judges to qualify the employee status for professionals enjoying great independence in the performance of technical functions (such as doctors, professors…). Thereby, this concept implies to carry out an activity within an organised structure (supply of equipment, premises), enjoying large autonomy but with certain constraints (determination of working hours, management of customers…).
In the Take Eat Easy case, the Supreme Court considered that an organised service was characterized by the geo-tracking system allowing the platform to control workers in real time. Besides, the bonus/penalty system depending on the respect of certain time schedule and on satisfaction rates left by clients allowed the platform to exercise a power of sanction.
Based on this precedent, the Paris Court of Appeal decided to qualify the relationship between Uber and one of its drivers into an employment contract (Paris Court of Appeal, January 10th, 2019, n°18/08357).
In addition to the geo-tracking and bonus/penalty systems, judges noticed that the driver was not able to freely decide neither the fare, or the itinerary to follow, and could not develop his own clientele. Moreover, monitoring tools set up by the platform encouraged the driver to remain connected, at its disposal, and prevented de facto him from choosing his own schedule. The workers’ possibility to decide not to work was set aside as being in itself not inconsistent with the existence of an employment contract.
Potential options
The Take Eat Easy precedent could have severe detrimental consequences for platforms considering the amounts at stake: criminal penalty for undeclared work, reassessment of social security contributions, payment of all the sums owed to the worker as per the employment contract, reimbursement of the contributions paid by the worker… It could be the end of the gig economy as this would clearly be inconsistent with most business models. This would also be detrimental to certain workers. Indeed, if illegal situation must be tackled to protect individuals, some are finding real opportunities in the freedom and flexibility offered by the gig economy.
To resolve this matter, the legal doctrine has already proposed different solutions based on existing rules, such as the so-called wage portage, or calling for the creation of a legal status for platforms’ workers.
A draft Bill is currently examined by the French Parliament providing for the possibility for every platform to establish a policy defining terms and conditions of its social responsibility. The Bill also specifies that this policy should not be used to characterize a subordination link between the platform and the worker, and thus an employment contract. This is good news, but it is not sure it will be enough to secure current situations and clearly define a real status governing the relationships between platforms and gig workers.
To be continued…
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