New forms of employment request social policy measures

How are new forms of employment impacting workers? Is the total flexibility of workers and labour market desirable? Will the sharing economy be putting an end to Europe's social protection systems?

Today's EESC public hearing, entitled the changing nature of employment relationships, the sharing economy, zero-hour contracts and the living wage discussed the growth of non-standard forms of employment in light of workers' protection.

Shifting work patterns, introduced by popular online platforms in the field of transportation or accommodation for instance, have important implications for the labour market, tax and social security systems, as well as the living wage. While innovation and creativity are crucial to driving a sustainable and competitive social market economy, these new forms of employment must lead to positive outcomes for all members of society, the hearing heard.

Employment practices that challenge the traditional norm of a full-time permanent job with defined working hours, agreed rights and benefits have steadily increased since the economic crisis in 2007-2008. A growing number of workers do not know in advance when or where they will work. Therefore, national social protection systems, based on the assumption that clear distinctions can be drawn between ‘employed’ and ‘unemployed’ status, are in desperate need of review.

This is why the EESC wants the Commission to help develop new social welfare models that are adapted to cover more flexible labour markets. The Commission should among others ensure that:

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  Adequate training provisions are made available to all workers, and Europeans of all ages should be educated in ICT skills
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  Statistics are gathered to accurately monitor the impact of new forms of employment on the labour market and economy
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  Clarity in the employment relationship are provided and liability for accidents, damage and service failures are resolved in relation to online platforms, crowdsourcing and other new forms of self-employment.

The EESC calls for the European Commission and the ILO i (International Labour Organization) to work together to develop a framework of decent working conditions for online workers, which would then be implemented as EU policy.

Effective rights and protection, monitoring and enforcement must be put in place to ensure that new forms of employment relationship do not result in a race to the bottom of pay and conditions, which would fuel widening income inequalities, reduce disposable income and suppress demand and potential for economic growth across the EU, said Kathleen Walker Shaw, rapporteur on the EESC’s Exploratory Opinion on the changing nature of employment relationships and its impact on maintaining a living wage.

The development of European platforms should be encouraged in such a way that the value created remains in local economies, drawing on Europe’s rich tradition of mutuality and cooperation in labour market coordination, often carried out at community level and with the active cooperation of trade unions and local employers. The ability of such workers to determine their levels of pay and conditions through collective agreements is vital to maintaining a living wage.