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Analysis

Online Labour Platforms in Europe

Text: The Policy Lab Digital, Work & Society at the Federal Ministry of Labor and Social Affairs

Why a distinction between location-indepen­dent activities (“cloud work”) and locationbound activities (“gig work”) is useful, as well as between platforms that award contracts to individuals and those that invite bids from the crowd.

BIO

The term “platform” has yet to be conclusively defined. In reports published by the European Commission, the following definition is used: “Online platform” refers to an undertaking operating in two- (or multi-) sided markets, which uses the internet to enable interaction between two or more distinct but interdependent groups of users so as to generate value for at least one of the groups. Certain platforms also qualify as intermediary service providers.’1 The German Monopolies Commission describes platforms simply as an ‘intermediary that brings together different user groups so they can interact economically or socially’.2

On online labour platforms – platforms that process work and services themselves or via subcontracting to (solo) self-employed – a common distinction is made between location-independent activities, known as “cloud work”, and locationbound activities, known as “gig work”.

Location-bound gig work

Gig work can be awarded to all users registered on a platform by means of an invitation to bid in the “crowd” or as a contract to individuals. Gig work is used in areas such as passenger transport, logistics and delivery services, household-related services and crafts services. Public debate currently tends to focus on gig work: What kind of working conditions do food delivery services offer, and what are the pay rates like for cleaning staff placed via platforms?

Location-independent cloud work

Subdivision into tasks placed with the “crowd” and the commissioning of individuals under contract is also a meaningful approach when distinguishing between forms of cloud work. Examples of tasks placed with the crowd involve “micro tasks”, meaning small-scale activities such as describing or classifying images according to specific questions. Contracts awarded to individuals generally involve design or text work, and also IT work.

Types of platform work

Platform design and the way in which the relationships between the platform, clients and platform workers are handled can vary greatly. Platform operators are constantly developing their business models, while platform workers are seen to belong to different groups of people with different interests. Thus, there is work available for the lower-skilled as well as the highly-qualified, there are tasks that offer both low and higher earning opportunities, and there are people for whom platform work is a secondary income and those who earn their living from it.

Agreeing on a uniform definition of the term “platform” is an important task in the debate on policy design for work performed on or via platforms. And given that platforms and platform workers often operate across borders, a uniform EU definition would also seem useful.

„The aim should be to promote both the new individualised opportunities offered by the platform economy and its economic potential, while at the same time ensuring that the platform economy brokers and fostersdecent work.“

The starting point for possible regulation of the platform economy could be to focus solely on platforms that make stipulations on, and thus in some way exert influence on, contract terms and performance and to exclude pure marketplaces from regulation. This stems from the fact that in the case of a pure marketplace, which does not influence contractual provisions in any way and leaves pricing completely up to the contracting parties, there is no activity on the part of the platform that would justify it being assigned a corresponding responsibility for platform workers’ work and earning opportunities. Thus, it is not a situation in which the special features of the platform economy business model are present.


Room to think: From here, the team from the Policy Lab Digital, Work & Society looks into the future. Photo: Konrad Schmidt


Online labour platforms are developing at pace. For many people, platforms offer good opportunities to take on work that suits their personal skills, abilities and availability. At the same time, it is obvious that platforms are often not only intermediaries but also have a direct and indirect influence on the way work is done and the remuneration that is paid. The aim should be to promote both the new individualised opportu­nities offered by the platform economy and its economic potential, while at the same time ensuring that the platform economy brokers and fosters “decent work”.

„For many people, platforms offer good opportunities to take on work that suits their personal skills, abilities and availability.“

Footnotes

1.
European Commission. (2016). Public consultation on the regulatory environment for platforms, online intermediaries, data and cloud computing and the collaborative economy, URL: https://ec.europa.eu/digital-single-market/news/public-consultation-regulatory-environment-platforms-online-intermediaries-data-and-cloud
2.
Monopolkommission. (2015). Sondergutachten 68: Wettbewerbspolitik: Herausforderung digitale Märkte, URL: http://www.monopolkommission.de/images/PDF/SG/SG68/S68_volltext.pdf
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