On September 29, 2022, the Commission adopted its Guidelines on the application of Union competition law to collective agreements regarding the working conditions of solo self-employed persons (“Guidelines”).[1] The Guidelines represent a part of a bigger push by the Commission to improve working conditions in platform work in the EU.[2]
Background
Self-employed persons risk infringing Article 101 TFEU if they engage in collective bargaining because they constitute “undertakings” under competition law. While the Court of Justice has held that collective agreements by trade unions negotiating on behalf of self-employed members comparable to workers fall outside the scope of Article 101 TFEU, uncertainty as to the status of self-employed persons remained.
Recent developments, such as an increase in subcontracting and outsourcing, the digitization of the production process and the rise of online platform economies, have increased the need for clarity on the application of Article 101 TFEU to self-employed persons. It is therefore not surprising that that the Guidelines were adopted at the same time as other digital platform instruments such as the Digital Markets Act.[3]
The Draft Proposal and The Final Guidelines
The Guidelines remain effectively unchanged from the initial draft proposal published by the Commission in December 2021. Most notably:
- The Guidelines exclude collective agreements by solo self-employed persons who are in a situation comparable to that of workers who fall outside the scope of Article 101 TFEU. In practice, this applies to three categories of solo self-employed workers: (i) those who provide their services exclusively or predominantly to one counterparty (on average 50% of total work-related income is from a single counterparty); (ii) those who perform the same or similar tasks side-by-side with workers for the same counterparty; and (iii) those who work through digital labor platforms.
- Even when the solo self-employed persons are not comparable to workers, the Commission undertakes not to intervene against collective agreements where solo self-employed people are in a weak bargaining position and unable to influence their working conditions. The Guidelines set a presumption of imbalance when either: (i) one or more counterparties represent the whole of a sector or industry; or (ii) a counterparty whose aggregate annual turnover or annual balance sheet total exceeds €2 million or whose staff headcount consists of at least 10 persons, or with several counterparties which jointly exceed one of those thresholds.
Conclusions
Historically, the EU courts have been reluctant to harmonize workers’ social policy through competition law.[4] The Guidelines do not change this approach: while they set out the Commission’s enforcement priorities, they do not introduce harmonization in the social sector, where competences remain primarily national. While the Guidelines do not target a particular industry sector, its focus on online platform economies transpires from numerous hypothetical examples in the Guidelines relating to online delivery services and ridesharing platforms.
[1] Guidelines on the application of Union competition law to collective agreements regarding the working conditions of solo self-employed persons, OJ 2022 C 374/2.
We reported on the draft proposal in our December 2021/January 2022 EU Competition Law Newsletter.
[2] The Commission has also published its Proposal for a directive of the European parliament and of the council on improving working conditions in platform work, 2021/0414, and Communication from the Commission on better working conditions for a stronger social Europe: harnessing the full benefits of digitalisation for the future of work, COM/2021/761.
[3] Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and fair markets in the digital sector and amending Directives (EU) 2019/1937 and (EU) 2020/1828, OJ L 265/1.
[4] See Albany International BV v. Stichting Bedrijfspensioenfonds Textielindustrie (Case C-67/96) EU:C:1999:430, para. 59: “However, the social policy objectives pursued by such agreements would be seriously undermined if management and labour were subject to Article [101](1) of the Treaty when seeking jointly to adopt measures to improve conditions of work and employment”.