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“Up to now only employees were
considered by law as vulnerable who would need protection. Most self-employed
though are not protected against the usual risks of a working life. Half of
self-employed in Germany have no old age security and don’t pay any
contributions in any kind of pension scheme. Many don’t have a health insurance
either which is supposed to be compulsory. The lack of social security for
self- employed is not a new phenomenon but it has gained more public attention with
the digital economy and crowd working” (union representative, Germany).

As you could see in the graph of Change in the nature of employment, 56% of independent workers are engaged in the
gig economy to earn a supplemental income. So, we can presume that this is not
the “main” job these individuals execute, from which they have access to social
protection. Afterwards we have to presume that the other source of income comes
from a standard employment model job. But if this is not the case, and for the
44% that use the sharing economy as a primary income, it is important to ensure
social protection for independent workers.

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Social rights and social protection for workers have always been a very
important issue for the European Union. The EU is extremely fond of social
rights, no matter the job an employee is performing.

The European Commission, one of the main institutes of the EU, published
a document in 2017 entitled “the European
Pillar of Social Rights”, which purpose is to establish common principles
and rights on equal opportunities, fair working conditions and job access. The
document contains 20 key principles for delivering new and more effective
rights for European citizens in the 21st century economy. The 3 main
objectives are:

–       Equal opportunities and access to the labour
market

–       Fair working conditions

–       Social protection and inclusion

Some of the principals are : Gender equality, Active support to
employment, Secure and adaptable employment (Regardless of the type and
duration of the employment relationship, workers have the right to fair and
equal treatment regarding working conditions, access to social protection and
training), Wages (Workers have the right to fair wages that provide for a
decent standard of living), Healthy (Workers have the right to a high level of
protection of their health and safety at work), safe and well-adapted work
environment and data protection, Social protection (Regardless of the type and
duration of their employment relationship, workers, and, under comparable
conditions, the self-employed, have the right to adequate social protection),
Health care (Everyone has the right to timely access to affordable, preventive
and curative health care of good quality).1

Even in the case of freelancers and independent or flexible workers, the
EU doesn’t look away. The European Commission intends to give the same rights
for both full-time, permanent workers as well as short-term ones. That way they
get rid of social inequalities that might surface from social protection
differences among these two statuses. Regardless the status of the worker or
the duration of employment, everyone has the right to a fair and equal
treatment and access to social protection, even if the employee is not active
at a company in this kind of economy.

The Commission is supporting the gig economy, because it creates new
jobs and opportunities for workers – as long as it does not negatively
influence self-employed parties. If the Commission would not try to regulate
this growing economic model, independent workers would suffer severe
consequences of not having the same social rights than the traditional workers.
Therefore, the protection of the Commission is necessary because new job
related to new technologies are often outside of the regular social protection.

Regulatory frameworks cover employment protection, employment contracts
and other areas like taxation and social security. But all these concepts are
different between the Member States, and sometimes even within the Member
State, because there is the possibility of variations in terminology and
definitions. “Different notions in different areas of law, however, do not
necessarily result in major differences with regard to the content “2

The problem however with this legal framework that the Commission is
building around the firms is that the new regulations could be very similar to
the system that is currently in place for more traditional businesses. The EU
could thereby change the very nature of the sharing economy and threaten the
changes of the uberization. Because with increasing social protection for the
independent workers comes increasing costs for the uberized companies. As a
consequence, the workers would lose their flexibility and the freedom to choose
their work hours, this would be the worst possible scenario for the people
depending on this flexibility. Uber, Deliveroo, Airbnb and all the other
businesses would turn more and more into traditional businesses.

In the case of Uber, an employee status for drivers would change the
company’s working arrangement: Uber would be further obligated in accidents
caused by drivers, the company would need to screen their workers more closely
and in the end, they would only have a few full-time drivers instead of a lot
of freelancers or part-timers.

Uber is not the only company creating job opportunities to coordinate
peer-to-peer exchanges and if Uber would be a transportation instead of a
technology company with drivers that are employees and not freelancers anymore,
would Airbnb be a hotel chain? And what about the other businesses working with
sharing platforms? Would they survive a shift in the employment status?

When it comes to social security, it also depends on every country and
how the laws determine what benefits you are entitled to and how much you
receive. In the US for example, social security is funded through primarily
payroll taxes, which are taxes imposed on employers or employees. In Europe,
access to health care a national responsibility. In France, contrary to the US,
the social security system is funded through contributions. If you are an
employer, employee or self-employed you need to pay more social security
contributions. The employer must declare the new employee to the Social
Security authorities. In the sharing economy however, the status of the workers
is not the same than for the traditional business. With them being classified
as independent workers instead of employees, it is unclear that the law applies
for these workers. A reform of the social security system to accommodate
platform workers would be a reasonable idea. The already existing social
protection systems could be revised to apply to this increasing number of workers
and to this increasing range of non-standard forms of work.

Some Member States have already tried to solve some of the problems, and
countries like France have already a relatively well-developed system of social
insurance for the self-employed. Independent workers do not benefit from the national
social security scheme. However, they can register themselves with the
social security system for non-employees. That is, social security
contributions are not triggered when a freelancer is hired. As for work-related
accidents and illnesses, independents workers are not entitled to any
obligatory insurance arrangement, but they can subscribe to optional social
security insurance or to a private scheme.

The central concept of this chapter is the protection
of the workers, some of them are not complaining about their working
situations, others are, and because of these complaints governments are putting
an effort into the future of social protection. It is not enough for the EU and
governments to established a set of regulations and laws, but they need to find
a balance in order for the gig economy to survive. It is a complex and
difficult subject that the administrations are facing with this new way of
organising work. Both at the national level and at EU level the problem of
classification of contracts has been tackled, but the question of how to
protect the flexible workers without harming the economy or harming the
flexibility is still up for discussion.

1https://ec.europa.eu/commission/priorities/deeper-and-fairer-economic-and-monetary-union/european-pillar-social-rights/european-pillar-social-rights-20-principles_en

2http://www.europarl.europa.eu/RegData/etudes/STUD/2017/614184/IPOL_STU(2017)614184_EN.pdf

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