Cross-border Impact Assessment 2018
Dossier 5: Social security of non-standard workers
Social security of non-standard workers: a challenge at the national and European level
Dr. Saskia Montebovi
‘Offering access to social protection is crucial for the economic and social safety of the workforce and wellfunctioning labour markets that create jobs and sustainable growth. Nevertheless, there is a growing number of people who, due to their type of employment relationship or form of self-employment, are left without sufficient access to social protection.’
Now that increasing numbers of workers, both in the Netherlands and in other Member States, can no longer be regarded as standard workers, it is useful to investigate the social security protection of this growing group of non-standard workers. Who are they? What protection do they have, what protection do they lack, and what happens in a cross-border work situation?
One can no longer ignore the increase in new forms of work and contracts including on-demand work, part-time work, intermittent work, voucher-based work, platform work, and work as a self-employed person (including pseudo self-employment). The evolution towards this type of working relationship over the last twenty years will – in the long run – affect and threaten the social, economic, and financial sustainability of our social security systems. But even now, the workers, their employers, and governments are reaching the limits of the current systems. As defining the employment relationship can be so complex, the social-security position of the nonstandard worker is often already up for discussion. On the basis of current legislation as well as the lack thereof, platform workers who offer and carry out their services via Uber, Deliveroo, Helpling, Werkspot, Foodora, etc. are generally classed as self-employed. This has a direct impact on their social-security protection, as this is much more limited for the self-employed compared with employees. It has also become apparent that workers with high levels of labour mobility often have insufficient social security rights and entitlements, precisely because of their changing work pattern, sometimes performed in multiple countries.
In addition to freedom and economic gain, this lack of a comprehensive and transparent legal framework for platform workers and workers with high levels of labour mobility leads to abuses, legal uncertainty, legal inequality, insufficient legal protection, etc. In the Netherlands, Wouter Koolmees, the Minister of Social Affairs and Employment, has promised to propose a solution by 2020. Furthermore, initiatives are being implemented at a European level, though they are non-binding.
In the absence of new legislation and sufficient jurisprudence, we will have to define and regulate the new employment relationships with the existing rules. The main bottlenecks are: firstly, the limited hours or income from non-standard working relationships and the associated limited social security contributions and accrual; secondly, the diffuse separation between employees and the self-employed, which also increases pseudo selfemployment; thirdly, the digital revolution, which is drastically changing the nature of work and working relationships; and fourthly, the European rules contained in the Regulations on the coordination of social security systems (EC Regulations 883/2004 and 987/2009). These European rules are still based on physical presence at a workplace. This is inflexible regarding workers in new forms of employment such as teleworking as well as hybrid workers – those who sometimes function as employees, self-employed individuals, or civil servants and sometimes combine several statutes and jobs – and with regard to temporary contractors who, whether voluntarily or not, enter into alternating short-term, temporary working relationships and who, in the meantime, sometimes find themselves in a legal vacuum. Moreover, those who work alternately in their country of residence and the country of employment are bound by the coordination rules specified in European regulations written during the period when workers had one job with one employer for a sustained period of time.
The Cross-border Impact Assessment further analyses European integration, sustainable development, and Euregional cohesion regarding non-standard workers such as teleworkers, homeworkers, and workers who have multiple short-term employment relationships, whether they are chosen deliberately and voluntarily or not. The themes of European integration and Euregional cohesion refer to the current complex or overly complex work and employment relations that cannot be addressed by the current coordination regulations. As the current designation rules of the Regulations still apply the country of employment principle as the main rule, while relying on the physical presence of the worker, teleworking or a combination of several jobs in several countries is difficult to classify and leads to undesirable and impractical changes to the applicable legislation. For example, one week a teleworker would be covered by social insurance in the Netherlands as that is where most of their working hours are spent, whereas during another week German social security legislation should apply because the teleworker works more hours at their home in Germany. This is unattractive for both workers and employers. As such, employers are not encouraged to make use of the free movement of persons. Moreover, the issue of equal treatment also plays a role, as employers who wish to treat all their employees equally and place them all under the Dutch social security provisions and labour law rules must take the 25% rule of the regulation into account. As a result, workers who work from home for one out of three or two out of five days will no longer be covered by social insurance under the legislation of the ‘main workplace’ or where the employer is established but will be insured under the social security legislation of their place of residence. This means that equal treatment in legislation and regulations, as employers also often pursue, is now practically impossible despite the fact that the working conditions at home and at the employer are almost identical via teleworking.
In short, the increase in non-standard working relationships and the gig economy definitely do not contribute to the legal certainty or clarity of non-standard workers. Moreover, it often does not contribute to a decent legal position for non-standard workers, most certainly not in cross-border working relationships. Both the current national legislation and the European regulations need to be refined or adapted, which would be beneficial to workers, employers, and governments.
 European Commission: Proposal for a Council Recommendation on access to social protection for workers and the self-employed, 13 March 2018, COM(2018) 132 final, page 1.
 For the description and definition of the non-standard worker as well as the standard working relationship, please refer to the Crossborder Impact Assessment on which this summary is based.
 European Commission, Proposal for a Council Recommendation on access to social protection for workers and the self-employed, 13 March 2018, COM(2018) 132 final, page 2.
 For more information, please refer to the European Commission Proposal for a Council Recommendation on access to social protection for workers and the self-employed, 13 March 2018, COM(2018) 132 final, pages 1 and 2. Please also refer to page 4 of the same document for percentages relating to the different types of employment relationships.
 Examples include the situation of workers at Deliveroo, Uber, Helpling, etc.
 For examples at the Dutch national level, please refer to documents such as the coalition agreement dated 10 October 2017, pages 22-26 (only available in Dutch). For EU-level examples, please refer to documents including European Pillar of Social Rights, A European agenda for the collaborative economy, 2018 Commission work programme, White Paper on the Future of Europe, Proposal for a Council Recommendation on access to social protection for workers and the self-employed, and Proposal for a Directive on transparent and predictable working conditions in the European Union.
 Please refer to the Social Security dossier from paragraph 2.3.2 onwards of the ITEM Cross-border Impact Assessment 2018.
 This is a simplified view since multiple factors play a role over a longer period of time. For more information, please refer to EC Regulations 883/2004 (Articles 11 and 13) and 987/2009 (Articles 6, 14, and 16).