After the debacle of the platform-work directive, will the EU still regulate artificial intelligence in the workplace?

In mid-February, the political agreement struck in December between the Council of the EU and the European Parliament on the directive to regulate platform work finally broke down, with insufficient member states’ representatives approving a provisional deal with the parliament earlier in the month. Last-minute wrangling on the presumption of an employment relation between the worker and the platform—even a new compromise which gave discretion to the member states on implementing this presumption in their legal systems—proved inadequate to prevent France, Germany, Greece and Estonia from forming a blocking minority.

For the progressive forces in the European Parliament and the responsible member of the European Commission, Nicolas Schmit, not approving platform-work legislation before the European elections in June represents a significant setback. It is unclear what will come of this initiative, supposed to improve the rights and protection of this precarious group of workers—not only vis-à-vis the employment relationship but also the treatment and risks they endure due to algorithmic management in its purest form.

In January, the Foundation for European Progressive Studies presented a study in its ‘Algorithims in the workplace’ programme with Nordic partners, a data-based analysis of platform work in Denmark. A senior policy-maker from the Danish parliament explained why, even in one of the best-regulated labour markets in Europe, there was a clear need to resolve on a European level the employment status of the riders. When the ‘gig’ economy took off, Danish regulators forced Uber to conform to domestic transport legislation—to which Uber responded by leaving the country.

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More recently, there were issues in Denmark with the Finnish delivery platform Wolt, which has faced adverse court rulings but remains defiant and exploits legislative ambiguity to retain its business model. The FEPS data revealed a sharp rise in ‘self-employed’ delivery agents working on a remuneration basis for Wolt, largely precarious youth with a non-Danish background.

No panacea

Although the status of platform workers draws the most attention, an employment contract is not a panacea, as became apparent when FEPS investigated quick-commerce workers. These riders and dark-store order pickers did ‘enjoy’ zero-hours labour contracts but still experienced very precarious working conditions.

This was not least because of algorithmic management, pushing them beyond a responsible consideration of road safety and the health and safety of workers. There were also cases of automatic dismissal via the algorithm/application, usually by no longer being scheduled, without any human involvement—something that was supposed to be disallowed under the stymied platform-work directive.

Nor is the deployment of artificial intelligence and algorithmic management only an issue for platform workers. It is also changing the reality on the shopfloor in traditional sectors. The use of algorithms, computer-programmed codes and procedures to co-ordinate labour inputs and outputs, by monitoring, evaluating and controlling workers’ behaviour and performance—often in granular detail—is on the rise, in warehouses, call centres, transport, retail, hospitality and finance.

On the one hand, these systems aim at unparalleled efficiency, heightened productivity and data-driven objectivity in business activities and decisions. On the other, there are justified concerns about labour exploitation, work intensification, obscured employer accountability for workers’ rights, increased information asymmetry between employers and workers (including their trade-union representatives) and potential (automated or semi-automated) discrimination against segments of the working population during recruitment and employment.

FEPS surveyed about 6,000 workers across the Nordic countries to see how often algorithmic management was deployed, what were the effects on workers and what could be done to mitigate the potential adverse outcomes, as we have seen with the riders delivering food for platforms. Although the responses and data still need to be analysed, we can confirm that automatic-management tools are already widespread in Nordic industries. They are being used to schedule work shifts, divide tasks and give instructions—and for the surveillance of workers.

Workers dehumanised

Algorithmic management has taken flight in warehousing, particuarly Amazon‘s warehouses. Amazon came under heavy criticism from the European Parliament for not sending a representative to a hearing by its Employment and Social Affairs Committee about working conditions for warehouse employees. Last month the parliament revoked the lobby badges of Amazon representatives due to its contempt.  

Research by Swedish colleagues at Handels (the commercial employees’ union) has shown the consequences of ‘pick by voice’ algorithmic management in warehouses. Instead of replacing workers with robots, order pickers are turned into robots following automatic instructions through headsets. They have no time for rest or social interaction, while overruling an instruction because packages are too heavy is not an option. Workers feel dehumanised, stressed to the limit, and their work is unsustainable from a health-and-safety perspective.

This cannot be the future of warehousing—a sector where the work used to have a social dimension, of interaction with colleagues, and embodied the skill of knowing one’s way around the warehouse to pick orders efficiently. Yet companies will feel the need to stay ‘competitive’ and Big Tech companies such as Amazon are setting the pace.

Agorithmic management is coming to more and more sectors, including transport (to determine the route of truck drivers) and finance (to monitor workers’ compliance with insider-trading and other rules). Starting with blue-collar workers, it is only a matter of time before it affects white-collar workers too.

Tracking performance

One of the most used software packages, Microsoft 365, comes with applications such as Microsoft Viva, tracking worker performance. Last year, this tool was combined with the AI-powered Microsoft Copilot. According to Microsoft, the information in Viva is just for the individual worker. Yet the data can inform managers about the collective performance of their team.

The vast data available to employers, rapidly evolving technology and unclear guidelines—including on embedding affective, emotional and biometric AI into algorithmic-mamnagement systems—could lead to ‘function creep’. Initially introduced for one purpose, technology and its generated data become used for others, such as evaluations during layoffs, performance appraisals and surveillance; at first, this is only in some companies but the practices spread.

Yet, despite common predictions that algorithmic-management systems such as Microsoft Viva and Copilot will transform working relations, this appears rarely to be discussed with trade union representatives before implementation. As the digital workspace unfolds around workers, digitalisation and the embedding of algorithmic techniques into organisational structures is often taken for granted.

The EU General Data Protection Regulation applies to personal data and grants some rights to data subjects—such as to gain access to, rectify, erase and move their data and to object to automated decision-making—but non-personal data, including behavioural or performance data, are beyond its scope. And even though the GDPR is relevant in a labour context, it neither grants collective rights to organised workers nor confers specific rights on the individual worker—such as the right to know the logic and criteria of algorithmic decisions or to contest and appeal them.

Codetermination

Fundamental changes to the work environment should depend, as a further FEPS study in this research programme shows, on codetermination between trade-union representatives and their employer. Codetermination, where extant, will increasingly relate to the digital aspects of the workplace and the algorithmic and automatic systems deployed to help but also supervise workers.

Yet there was no majority in the European Parliament to recognise the role of trade unions in the AI Act when it came to AI in the workplace, classified as a ‘high-risk’ case. Provisional agreement on that legislation was also arrived at by the council and the parliament in December.

In the platform-work directive text, a worker’s representative was given a place, specifically in seeking expert help to understand the often opaque (including to managers) algorithmic systems with which platform workers have to contend. More transparency requires being able to make sense of the dynamics of the impact of algorithms on workers.

The same holds though for workers in traditional sectors. Their union representatives need transparency on algorithmic-management systems, by calling on external experts paid for by the employer. In Norway, a dedicated ‘data shop steward / data trade union representative’ is already recognised in the Main Agreement (2022-25) between the Norwegian Confederation of Trade Unions (LO) and the Confederation of Norwegian Enterprise (NHO). The principal objective is to create conditions where workers are not merely passive subjects of algorithmic control but active participants in the innovation process who can negotiate acceptable limits on digitalisation.

Legislating for or institutionalising codetermination, to cultivate synergy among workers, technology and employers when implementing AI in the workplace, opens up new possibilities for workers to exert agency and contribute to innovation. To seize this opportunity, policy-makers and pro-labour groups must acknowledge that codetermination hinges on the presence and strength of workers’ unions as their collective voice. It also depends on reinforcement of the collective rights of workers and upgrading of collective agreements for new digital realities—essential to level the playing field so workers can effectively engage with and gain leverage over evolving technologies.

Workers on board

After the failure to agree on legislation to protect platform workers from exploitation and precarity, on which legislators had worked for years, it is hard to be optimistic about the prospects for the more general legislative proposals on AI in the workplace. Strengthening trade unions’ role in digital codetermination might not be supported by all political groups or member states.

Yet this development will not stop or even slow down, and workers need to be on board to make the digital transformation of their workplace successful. It should be part of Europe’s digitalisation model to draw on the strength of the social partners and the efficiency gains the AI revolution offers while safeguarding workers’ rights. Empowering and including workers, instead of demotivating or even dehumanising them, can avoid the dystopian future millions of European platform workers already experience.