Labour and Employment Ministers’ Meeting

Debate on regulating digital labour platforms is crucial

The ILO Director-General highlighted the need for policies to deal with the challenges of web-based labour platforms. Some form of regulation is needed, Guy Ryder said at the meeting of G20 Labour and Employment Ministers in Matsuyama, Japan.

Statement | Matsuyama, Japan | 02 September 2019
Thank you, Minister.

Stefano, you mentioned the heterogeneity that exists in this area, and indeed I think it’s essential to distinguish between at least two main forms – first, those network companies that provide operations locally – taxis, food delivery, and other services to customers. We pay a lot of attention to them.

We pay less attention to micro-task web-based digital labour platforms, which permit the real-time hiring of labour for a myriad of tasks independently of location. Typical examples are IT programming, web development, graphic design, copywriting or routine clerical tasks. Large groups of workers (“the crowd”) living often across multiple time zones offer businesses the possibility of completing large projects at any time of day or night.

The first category, the location-based platform economy lends itself to national-based regulation, including the issues of classification that Stefano has gone into.

But the situation is different in the second case, that of web-based digital labour platforms with workers spread throughout the world. Adequate regulation of this form of work would seem to call for some form of international governance system.

Let me provide some thoughts on that basis.

As Stefano has mentioned, according to the Oxford Internet Institute, activity on the five largest English-language web-based labour platforms expanded by one-third between July 2016 and March 2019. And an ILO study covering five English-speaking micro-task platforms revealed that they contracted workers from 75 countries. This attests to the geographical dispersion of the work.

So what are the risks and what are the opportunities?

The main advantage of working on digital labour platforms is the flexibility it offers: workers can choose when, where and how they wish to work. As a result, workers with disabilities or caring responsibilities and those living in rural or economically depressed areas are highly represented among crowd workers. So web-based platforms can be an important source of income: according to our study, income earned on micro-task platforms was the main source of income for one in three workers.

But web-based platforms present a number of challenges too.

First, our research shows that a high proportion of workers earn below the minimum wage prevailing in their jurisdiction. Some platforms charge their workers commissions or service fees, which further lowers the effective earnings. Those low earnings are due in part at least to the workers’ inability to obtain tasks on a continuous basis, and to the time spent finding suitable tasks.

Secondly, work is available irregularly. Nine in ten workers mentioned that they would like to work more – on average about 12 hours more per week.

Thirdly, digital labour platforms classify their workers as self-employed, or independent contractors, resulting in a lack of labour protections and employer-provided social security benefits. For instance, among American workers on the Amazon Mechanical Turk platform, 91 per cent of workers who were performing crowdwork as their main job were not contributing to social security.

Our survey also revealed a lack of access to grievance or dispute settlement mechanisms. This matters. Nine out of ten workers had experienced having their work rejected, and didn’t get paid as a result. In the absence of a grievance mechanism, they were left without any remedy.

Finally, organization of workers on web-based platforms and their participation in bargaining processes is difficult and in current circumstances is largely absent.

Ministers, these challenges call for some form of reaction and regulation. But the geographical dispersion among workers, their platforms, and their clients that I’ve described creates challenges at a purely national level. Lack of uniformity in court decisions across the world, as well as problems of conflicts of laws and of compliance, are likely to occur as a result.

The regulation of digital platform work at the national level only may encourage a practice of “forum shopping” by parties who engage in legal action to find the jurisdiction with the most favourable legal situation. Platforms may also seek to impose their choices by clauses included in the online terms of service that they may establish unilaterally.

In reality, implementing national regulations alone could risk creating a competitive disadvantage for the workers who are covered, compared to workers in other locations that are not covered by such regulation.

Recognizing the difficulties deriving from efforts to regulate digital labour platforms at the national level, the ILO’s Global Commission on the Future of Work called for the “development of an international governance system for digital labour platforms”, although it is proper to recall that this was a matter of some contention among the ILO’s tripartite constituents.

Some tools already exist and can be used to govern work on web-based digital labour platforms from an international perspective.

Two ILO conventions are relevant to the issue, and those are the Protection of Wages Convention and the Private Employment Agencies Convention, which prohibit charging fees to workers for obtaining work.

In addition, the ILO’s Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy could also constitute a useful starting point as we address these issues.

Finally, eight digital labour platforms headquartered in Germany and the United Kingdom, but with legal presence in other European countries and operations that span the globe, have signed a voluntary Code of Conduct called the Crowdsourcing Code of Conduct. It sets out a basic set of ten guidelines with a view to promoting trust and fair cooperation among service providers, clients and crowdworkers. These guidelines include “fair payment”, “clear tasks and reasonable timing”, and “motivating and good work”. This last guideline is based on the view that most aspects of good work in the analogue world can be transferred to a digital environment.

To enforce this Code of Conduct and to resolve disputes between workers and signatory platforms, regardless of the location of the worker, an Ombuds Office was established in 2017. It is composed of a board of five people – one worker, one trade union representative, a platform representative, one Crowdsourcing Association representative, and a neutral chair. As of January 2019, that Ombuds Office had resolved 22 cases submitted by workers via its online complaint form.

Clearly, there is a major debate ahead of us, and it is good that we are starting to investigate the policies that could be needed. They could involve setting minimum standards; establishing mechanisms to adjudicate disputes between platforms, clients and workers; developing the infrastructure necessary for facilitating payments to social security systems; and examining how to enable workers of web-based digital labour platforms to achieve collective representation.

So I very much welcome and look forward to the exchanges we will have, and offer the ILO’s services in relation to the endeavours we will no doubt enter in.

Thank you.