OECD concerned about ‘excessive and improper’ use of platform work

The OECD report on “Policy Responses to New Forms of Work” provides a snapshot of the policy actions taken by 44 OECD, European Union and G20 countries to address the emergence of forms of employment and contracts of work that diverge from the standard full-time open ended employment relationship.

One of the key messages from the OECD is that policy needs to act to avoid an excessive or improper use of such forms of non-standard work. Policymakers have to make sure that the flexibility offered by non-standard work practices is balanced by protections for workers. Such balance, says the OECD, is necessary to avoid a potential negative impact on job quality, equality, productivity and growth, sustainability of social protection systems but also to ensure fair competition among firms.

Moreover, when describing policy directions, measures to upgrade worker protection also include a strengthening of labour law and labour market regulation, besides ensuring adequate social protection for more workers. In particular, the OECD is highlighting the importance of:

(i) Tackling misclassification of workers as employment status acts as a gateway to various worker rights and protection. This implies, amongst others, stronger labour inspectorates and making it easier for workers to challenge their employment status.

(ii) Extending rights and protections to vulnerable workers in the grey zone between dependent employment and self-employment, while being careful not to create opportunities for employers to downgrade contracts which otherwise would be standard employment relationships.

(iii) Greater efforts to prevent employers from abusing fixed term, casual and platform working arrangements as a vehicle to cut costs and circumvent labour market regulations.

(iv) Adapting existing regulations in order to extend the right to collective bargaining to workers whose employment status is ambiguous but also all genuine self-employed who find themselves to be in a vulnerable position.

(v) Supporting those in non-standard forms of work to develop professionally by ensuring broad access to adult learning.

This approach is welcome as it confronts employers with the costs of the flexibility and prevents business from shifting all of the risk to workers and social protection systems.

Finally, an accompanying report provides more detail on another policy direction proposed by the OECD, which is to reduce incentives for worker misclassification by avoiding large differences in tax and social contributions.