Employment Risks in the Age of the Algorithm

age-of-the-algorithm

Important debates on the future of work have been on the agenda of politicians and legislators for some time. But now that the EU has come through the worst of the pandemic, new nuances have been added. Acceleration of the digitalization process over the past three months, with massive use of telecommuting, is creating new challenges. And this also compounds the risks for the most vulnerable citizens, such as older workers and freelancers who rely heavily on technology platforms. 

These were the main issues discussed at the recent online roundtable ‘Europe facing digitalization of the labour market: new jobs, less rights?’, organized by El País Retina and the European Association for Digital Transition. Participating in the roundtable were Ricardo Rodríguez Contreras, president of EADT, economist Toni Roldán, María Luz Vega, advisor to the International Labour Organization (ILO) and special advisor for its “Reshaping Work” program, and Sara de la Rica, director of the ISEAK Foundation, specialised in social and labour issues. Although coming from different perspectives, they all highlighted the crucial crossroads at which the labour market finds itself. 

It is not just a matter of regulating telecommuting, a task that is essential. Facing new employment alternatives, with their pros and cons, how can we create a level playing field that stimulates competition and truly takes into account the social approach that characterizes the European labour framework? 

The question is particularly relevant when analysing the phenomenon of platform economies, with companies such as Uber, Deliveroo, Glovo or Amazon Flex, the service from the North American giant that uses independent workers to deliver packages in their city. Approximately 2% of adults in the EU have their main source of income in what we call platform work, and up to 8% earn occasional income from these types of work alternatives, according to data from a study by the European Commission’s Joint Research Centre.

For Sara de la Rica, the impact of these platforms on the labour market is not so much quantitative as qualitative. On them “the relationship between employer and employee changes, going from being occupational to being commercial. That is neither good nor bad in itself, as long as workers have protection at work”. Toni Roldán, visiting professor at the London School of Economics, pointed out some positive aspects of these platforms, such as offering workers the opportunity to supplement their income with short-term jobs, but he asserted that the platforms need regulation to avoid their labour framework becoming the “wild west”.     

“There are now new workers and new needs, so we are up against an urgent debate”, stated María Luz Vega in regard to this issue. “An algorithm regulates labour relations on these platforms. There is no one to complain to. Prior to the pandemic, the need to propose a new labour law had already arisen; it is now clear that different regulations are needed”, she said. Furthermore, Ricardo Rodríguez stressed the possible distortion of competition from these platforms, coinciding with the representative from the ILO.  

In this respect, another aspect to consider is taxation, since these platforms do not have a classic commercial structure – or have it outside of the EU – which complicates assessment of their activities by the States. Three EU countries – Denmark, France and Estonia – are making progress in getting better information on these companies’ income, and a recent report published by the European Commission called for a coordinated effort from all 27 countries.

The challenge of inequality

Although the panel touched on all kinds of labour market issues – the ‘gig economy’, industrial automation, relocation, telecommuting and a search for balance – several concepts came up repeatedly. For example, equality, in terms of competition between companies as well as in terms of basic rights between workers. Also frequently cited was the need to take into account the risk of leaving behind those people in the worst circumstances to adapt to this new environment of more remote working. 

According to ILO estimates, telecommuting could reach 25% in the most industrialized countries and exceed 15% in the rest. It is a huge percentage jump from the pre-COVID world, and it requires an effort to avoid some of its risks. Facing this phenomenon, “many companies only take into account the technological dimension and not the needs of people to adapt”, De La Rica asserted. “If governments do not make an effort, especially in regard to schools, telecommuting is absolutely incompatible with a personal life, especially for families with young children”, claimed Toni Roldán. 

Workers’ rights, industrial automation, market competition, taxation, telecommuting, balancing professional and family life, etc. As a result of COVID-19, the redefinition of the world of work that was already underway in Europe in the twentieth century can no longer wait. This is an opportunity to define a fair framework that is consistent with EU values, which guarantees our economic sovereignty and our prosperity.  

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