The phenomenon of platform labour has been a much-debated topic in the past few years. In previous articles, we already discussed the Deliveroo ruling and the Uber ruling.
The Amsterdam Court of Appeal has put platform labour in a new light in its ruling regarding Helpling. In brief, Helpling is an online platform that connects households to domestic helpers (cleaners).
On 1 July 2019, the Subdistrict Court of Amsterdam ruled that cleaners who worked via Helpling had employment agreements with the households they work for, and that Helpling acted as an employment agency in this process. However, the Amsterdam Court of Appeal now held that the cleaners have a temporary employment agreement with Helpling, and that the households are hirers. How did the Court of Appeal arrive at this opinion, and what are the main points for practice?
The Qualification Test
The matter in dispute in these proceedings was not whether the cleaners had an employment agreement, but with whom. It was an established fact that the cleaners were performing labour and receiving wages for it. The Court of Appeal still had to decide who had authority over the cleaners: Helpling or the households.
Legal Relationships
First of all, the Court of Appeal addressed the possible legal relationships between the parties. The Court of Appeal held that Helpling presented itself to the households in such a way (through the sites and FAQs) that the impression was created that no employment agreement would exist between the households and the cleaners.
The regulations in place on the platform contain a number of conditions that are not compatible with employment law, which indicated the non-existence of an employment agreement between the households and the cleaners. The Court of Appeal considered the following – contradictory – regulations to be relevant here:
- The agreement could be terminated without dismissal proceedings;
- A call could be cancelled at no cost 24 hours in advance, instead of the statutory 4 days;
- A household did not have to continue paying wages during sickness;
- A cleaner could easily be replaced;
- The cleaner’s wages would include sick pay and holiday pay, which is not allowed.
Next, the Court of Appeal held that Helpling has a lot of influence on the contractual relationship between the households and the cleaners. In practice, the terms of employment were regulated by the general terms and conditions drafted by Helpling, and the rates of the cleaners were directed by Helpling through recommended prices and price suggestions. Indeed Helpling had an interest in this, because a higher rate would result in a higher percentage of commission.
Moreover, Helpling forced the households and cleaners to make all payments (of wages) via the payment service chosen by Helpling: “Stripe”. Helpling also prepared the (draft) invoices for the cleaners. The Court of Appeal considered such interference by a third party – Helpling – in the contractual relationship between parties to be difficult to reconcile with an employment agreement between the households and the cleaners.
No ‘ordinary’ employment agreement
The Court of Appeal held that by doing all the above, Helpling is playing such a role within the contractual relationship(s) that it constitutes formal authority over the cleaners. Therefore, the agreement between Helpling and the cleaners meets all the requirements of an employment agreement (labour, wages, and authority). However, it is not an ‘ordinary’ employment agreement.
It is the households that are guiding and supervising the work, and the households are also the party giving instructions. This means that it is the households that have substantive authority. The Court of Appeal held that this is characteristic of a temporary employment contract, and that this way of making workers available meets all the requirements of a temporary employment contract. Helpling is therefore a temporary employment agency, the cleaners are temp workers, and the households are hirers.
Consequences
As a result of this ruling of the Court of Appeal, all cleaners now have temporary employment contracts with Helpling. This makes it possible for the cleaners to bring claims for back wages to Helpling even now (in principle up to 5 years back, pursuant to Section 3:307 DCC).
Waadi
The existence of a temporary employment contract means that the Waadi
applies (Placement of Personnel by Intermediaries Act). This Act prevents Helpling from obstructing (from now on) a cleaner in directly taking up employment with a household. The Court of Appeal considered the fine that Helpling used to impose for this to be unlawful. Households can probably claim back any fines already paid from Helpling.
Conclusion
This ruling is another setback for businesses that operate through an online platform. Where work is being done through a platform, chances are big that an employment agreement exists. Platform companies are facing an insecure future.
Do you have any questions about this article? Please feel free to contact Sjoerd Backx.
