Better together? European Commission publishes final guidelines on how competition rules apply to gig economy workers

The European Commission has published its final guidelines on the application of EU competition rules to collective agreements regarding the working conditions of solo self-employed persons (Guidelines), which are largely targeted at digital gig economy workers. We previously wrote about the Commission’s consultation on the proposals, which formed part of module V of its Digital Services Act consultation. Now the Guidelines are finalised, gig economy workers will have greater clarity on how they can “unionise” within the EU.

Why are Guidelines needed?

Article 101 of the Treaty on the Functioning of the European Union (TFEU) prohibits certain agreements between undertakings that restrict competition in the EU. The Guidelines set out the principles for assessing how collective agreements concerning working conditions between (1) solo self-employed persons and (2) one or several companies, should be treated under Article 101.

The context for this is that, while the antitrust laws of most jurisdictions exempt collective bargaining by unions or collectives of workers from antitrust law, self-employed workers (particularly gig workers) can be classified as undertakings under EU law and agreements between them to negotiate collectively for better terms and conditions could, in principle, infringe the Article 101 rules on anti-competitive agreements.

The Guidelines clarify that:

1.  collective agreements by solo self-employed persons who are in a situation comparable to that of workers fall outside the scope of Article 101; and
   
   
2.  the Commission will not intervene against collective agreements of solo self-employed persons who experience an imbalance in bargaining power compared to the other party.

What’s the scope?

The Guidelines will apply to any collective agreements concerning working conditions of solo self-employed persons, which includes matters such as remuneration, rewards and bonuses, working time and working patterns, holiday, leave, physical spaces where work takes place, health and safety, insurance and social security, and conditions for termination of services. 

They explicitly do not cover agreements which go beyond the regulation of working conditions or determine the conditions (e.g. prices) under which services are provided to consumers, or which limit the freedom of companies to hire labour providers. 

Solo self-employed persons are those that are in a situation comparable to that of workers. The Commission considers that this includes the following categories and that, therefore, collective agreements negotiated and concluded by them fall outside the scope of Article 101:

• economically dependent solo self-employed persons: who provide their services exclusively or predominantly to one party, which the Commission considers to be where that person earns, on average, at least 50 % of total work-related income from a single counterparty, over a period of either one or two years;
  
  
• solo self-employed persons working ‘side-by-side’ with workers: who perform the same or similar tasks ‘side-by-side’ with workers for the same party; and
  
  
• solo self-employed persons working through digital labour platforms: who find themselves in a situation comparable to that of workers through digital labour platforms, i.e. gig economy workers.

In addition, the Commission recognises that solo self-employed persons who are not in a situation comparable to that of workers may nevertheless have difficulties in influencing their working conditions because they are in a weak negotiating position due to an imbalance of power. Therefore, even if it cannot be assumed that their collective agreements fall outside the scope of Article 101, these solo self-employed persons may in fact face difficulties that are similar to those faced by the categories of solo self-employed persons discussed above. Therefore, the Commission will not intervene against the following categories of collective agreements:

• collective agreements concluded by solo self-employed persons with counterparties that have a certain level of economic strength: which can be assumed if certain thresholds are met; and
  
  
• collective agreements concluded by self-employed persons pursuant to national or Union legislation: including by granting such persons the right to collective bargaining or by excluding from the scope of national competition law collective agreements concluded by self-employed persons in certain professions.

What’s the impact?

The Guidelines aim to provide legal certainty to gig economy workers and other solo self-employed persons where previously there may have been doubts. They will also provide more clarity for the digital platforms and other companies that contract with such workers. 

These issues were put under the spotlight during the Covid crisis, and the Guidelines will be welcomed by those who argued that competition law was a hinderance to addressing a perceived imbalance of bargaining power – although they come later than many had hoped.