In an earli­er blog we dis­cussed the risk of (re)qualification that can arise when plat­forms engage freel­an­cers (read it here). The ques­tion of wheth­er freel­an­cers should actu­ally be clas­si­fied as employ­ees is com­plex in itself. How­ever, this is not the only ques­tion which could arise in this con­text. It may also be unclear who should be appoin­ted as the employ­er. This is espe­cially the case in regard to plat­form labor, where three parties are involved. Is the employ­er the plat­form or the cli­ent for whom the work is per­formed? Add to this the ques­tion of which type of employ­ment rela­tion­ship applies to the parties – such as an employ­ment con­tract, a tem­por­ary employ­ment con­tract (in Dutch: Uitzen­dovereen­komst), or an “employ­ment rela­tion­ship” accord­ing to EU dir­ect­ives – and you will find your­self in a com­plex leg­al maze. Each clas­si­fic­a­tion comes with an altern­at­ive set of rules. The recently pub­lished advis­ory opin­ion of the Advoc­ate Gen­er­al (AG) (a non-bind­ing advice to the Supreme Court) in the Helpling case demon­strates this com­plex­ity. The sub­dis­trict court, the court of appeal, and the AG each reached a dif­fer­ent con­clu­sion.

 

What was the issue?

Helpling was a plat­form that con­nec­ted house­holds and clean­ers. The clean­ers would then per­form work for the house­holds. FNV (The Neth­er­lands Trade Uni­on Con­fed­er­a­tion) et al. and Helpling are in dis­pute about the clas­si­fic­a­tion of the employ­ment rela­tion­ship. The fol­low­ing ques­tions have been presen­ted to the Supreme Court:

• Did the clean­er have an employ­ment con­tract with Helpling?
• Did the clean­er have a tem­por­ary employ­ment con­tract with Helpling?
• Did the clean­er have an employ­ment con­tract with the house­hold?

Although the issue in this case is not wheth­er the clean­er qual­i­fies as a freel­an­cer – the parties agree that this is not the case – the Supreme Court’s judg­ment is also rel­ev­ant for mat­ters con­cern­ing (re)qualification. In both cases, the cri­ter­ia to determ­ine wheth­er an employ­ment con­tract exists must be assessed. We are await­ing the Supreme Court’s rul­ing with keen interest.

 

The dif­fer­ent judg­ments so far

The sub­dis­trict court: employ­ment con­tract between the clean­er and the house­hold

Accord­ing to the sub­dis­trict court, Helpling did not exer­cise author­ity over the clean­er, mean­ing there was no employ­ment con­tract. This judg­ment was based on the fact that Helpling did not exer­cise dir­ect super­vi­sion and con­trol over the clean­ers. Since an employ­ment con­tract is a pre­requis­ite for a tem­por­ary employ­ment con­tract, the sub­dis­trict court also ruled that there was no tem­por­ary employ­ment con­tract. On the oth­er hand, the sub­dis­trict court found that an employ­ment con­tract did exist between the clean­er and the house­hold, because the house­hold paid the wages, exer­cised author­ity, and the work was per­formed on behalf of the house­hold. There­fore, all stat­utory employ­er oblig­a­tions res­ted on the house­hold.

 

The court of appeal: Tem­por­ary agency work con­tract between the clean­er and Helpling

The court of appeal reached a dif­fer­ent con­clu­sion, rul­ing that there was a tem­por­ary employ­ment con­tract between the clean­er and Helpling. In regard to a tem­por­ary employ­ment con­tract, the author­ity cri­teri­um is assessed dif­fer­ently than with respect to a reg­u­lar employ­ment con­tract. The “mater­i­al” author­ity lies with the hirer (the house­hold), while the tem­por­ary agency employ­er (Helpling) must exer­cise “form­al” author­ity. Accord­ing to the court of appeal, this form­al author­ity was exer­cised because Helpling determ­ined how the clean­ers were paid. Helpling was there­fore con­sidered the (tem­por­ary agency) employ­er, with all cor­res­pond­ing stat­utory employ­er oblig­a­tions. The house­hold only acted as the “hirer” of the clean­er, mean­ing there was no employ­ment con­tract between the house­hold and the clean­er.

 

AG Opin­ion: employ­ment con­tract between the clean­er and Helpling

The AG believes that a house­hold can­not qual­i­fy as a hirer, as this requires that a hirer oper­ates in the con­text of run­ning a busi­ness, which is not the case for a house­hold. The AG con­cludes that there is a reg­u­lar employ­ment con­tract between Helpling and the clean­er, which implies that the employ­er author­ity fully lies with Helpling. Although the super­vi­sion and con­trol are with the house­hold, the AG argues that this does not pre­clude that the require­ment of author­ity is met. The AG is con­vinced that “author­ity” mani­fests dif­fer­ently in the con­text of plat­form labor, where min­im­al work-related instruc­tions, giv­en the sim­pli­city of the work, are often suf­fi­cient. The AG thus seems to intro­duce a spe­cif­ic inter­pret­a­tion of the author­ity cri­terion for plat­form labor. This would mean that in many cases of plat­form labor, a dif­fer­ent (less strict) author­ity cri­terion applies. This aligns with the reas­on­ing of the Ams­ter­dam sub­dis­trict court in the Uber plat­form case, which spoke of “mod­ern” employ­er author­ity (read about it in our previous blog). If the Supreme Court adopts this inter­pret­a­tion, it could rep­res­ent a sig­ni­fic­ant devel­op­ment in the field of plat­form labor, poten­tially with sub­stan­tial implic­a­tions for plat­forms.

 

Helpling versus Tem­per: Con­sist­ent with each oth­er?

The (re)qualification issue in tri­an­gu­lar employ­ment rela­tion­ships is com­plex. But can any con­sist­ent lines be drawn between the rul­ings? Below, we com­pare the recent rul­ing of the Ams­ter­dam Dis­trict Court in the Tem­per case (read it in our previous blog) with the Helpling rul­ing as out­lined above.

Just like Helpling, the work­ing meth­od of the Tem­per plat­form can be clas­si­fied under the cat­egory of “mediation/matching” and thus also seen as a “bul­let­in board” where ser­vice pro­viders and demand of these ser­vices are brought togeth­er. The Ams­ter­dam Dis­trict Court ruled in the Tem­per case that there was no tem­por­ary employ­ment con­tract (and no employ­ment con­tract) between Tem­per and the workers/freelancers because the wage require­ment was not met. In this rul­ing, the court used the reas­on­ing from the court of appeal’s rul­ing (and not the AG’s opin­ion as described above) in the Helpling case.

With respect to both plat­forms, the workers/freelancers/cleaners do not receive their pay­ment dir­ectly from the plat­forms but via an extern­al pay­ment ser­vice. This pay­ment meth­od indic­ated, accord­ing to the court of appeal in the Helpling case, an employer/employee rela­tion­ship between Helpling and the clean­er. The wage require­ment was thus met. How­ever, in Helpling, it was already estab­lished that there was an employ­ment con­tract. The ques­tion was only who the employ­er of the clean­er was. Essen­tially, it came down to the ques­tion of in rela­tion to which party the wage require­ment was ful­filled “the most”. There­fore, the court in the Tem­per case con­sidered that the con­cern­ing pay­ment meth­od in the Tem­per case – where the ques­tion of wheth­er an employ­ment con­tract even exis­ted was still under con­sid­er­a­tion – should not carry the same weight, as this meth­od can also be con­sidered appro­pri­ate for the matching/bulletin board func­tion the plat­form ful­fills. Accord­ing to the court in the Tem­per case, the wage require­ment was not met.

The reas­on­ing of the court in the Tem­per case sug­gests that the estab­lished exist­ence of an employ­ment con­tract in Helpling was decis­ive in the determ­in­a­tion that the wage require­ment was met. How­ever, the AG does not take this into account in the reas­on­ing as to why the wage require­ment was met in Helpling. Again, the AG points to a spe­cif­ic eval­u­ation meth­od that should apply in mod­ern employ­ment rela­tion­ships, such as in plat­form labor. The coordin­at­ing role and decision-mak­ing author­ity of Helpling regard­ing the wages are rel­ev­ant factors in that con­text. Thus, a spe­cif­ic cir­cum­stance does not neces­sar­ily lead to the same con­clu­sion in all cases. There can also be dif­fer­ing views on why a par­tic­u­lar cir­cum­stance points in one dir­ec­tion or anoth­er.

 

Con­clu­sion

Briefly put, even if the way plat­forms oper­ate is very sim­il­ar on many points, the leg­al clas­si­fic­a­tion of the employ­ment rela­tion­ships does not neces­sar­ily have to be the same. Assess­ment requires care­ful con­sid­er­a­tion, where small dif­fer­ences in details can tip the scales in a dif­fer­ent dir­ec­tion. Moreover, it appears from the above that the same details do not always lead to the same judg­ment. We look for­ward to the insights that the Supreme Court will soon provide, hope­fully offer­ing more clar­ity in the assess­ment frame­work.

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