The Regulation of Digital Work in a Cross-Border Context: A European and International Perspective to the Global Labor Market

Johanna Jacobsson Assistant Professor, PhD IE Law School, Madrid

ABSTRACT for the “Reshaping Work in the Platform Economy” Conference

Title: “The regulation of digital work in a cross-border context: A European and international perspective to the global labour market”

Tomorrow’s labour market will be truly global. The more digitised and automated work becomes, the more creative and intelligent the human input needs to be. The formal setup of work performances is likely to change as well. A grand shift from (more or less) steady employment relationships to various forms of contractual service supply by independent professionals is already taking place. According to some predictions, especially the highly-skilled work can in the future be supplied from anywhere, at any time. Such work will be mostly carried out digitally, combined with short stays in various countries where the clients or co-operators are based. The service suppliers (typically self- employed providers of work performances) will often offer their contribution through various freelancer platforms based anywhere in the world.

This development brings about numerous legal challenges that relate both to domestic and international aspects of digital work and freelancer platforms. In the domestic setting, countries are facing the challenge of enforcing, and sometimes re-designing, their labour laws, social security and tax laws in order to answer to the challenges of the new digital and global work environment. The international aspect relates to the need to agree which country has the right to regulate the work performance and to collect social security payments and taxes related to it. Uncertainty about the applicable law is often present also in traditional cross-border work situations. In digital work, however, choice of law issues are even more likely to arise as workers (service suppliers) may provide the entire work performance from their own country of establishment. In such a situation, the application and enforcement of various national rules necessarily requires more and deeper international cooperation.

With regard to labour law, an important issue as itself is the legal form in which digital work takes place. The conceptualisation of a work performance as employment or, alternatively, as contractual service supply (self-employment) has significant ramifications for the applicable rules. Another issue concerns travel abroad; domestic and international rules must also respond to growing flows of movement of independent professionals. In this respect, the division between labour and service supply is also significant as immigration rules tend to treat the two situations differently.

The proposed paper concentrates on the international aspects of digital work. It looks into how the various issues relating to new types of global work are regulated, firstly in the EU, and secondly, in international agreements. The paper also analyses market access conditions for the freelancer platforms themselves by looking into EU and international trade law rules (particularly by analysing countries’ services trade commitments). Even though digital work has existed since the early days of the internet, the fast-growing pace of the phenomenon, combined with organised online platforms offering digital work performances globally, necessitates new and more efficient regulatory responses. The paper aims to estimate to what extent current regulatory systems may be successful in tackling the challenges raised by an increase in cross-border digital work. It is proposed that in any case more international coordination, and ideally also hard-law instruments, are required in the areas of labour laws (including worker protection), social security, taxation and international movement of people.