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Platforms, Algorithms, and Labour as a Commodity

María Luz Rodríguez

5 mins - 1 de Febrero de 2024, 07:00

Two years after the European Commission proposed the adoption of a Directive to improve working conditions in the platform economy, and after a difficult negotiation process, an agreement in principle was reached between the European Parliament and the Council on the final text of this Directive on 13 December 2023. However, in the final vote on 22 December 2023, a blocking minority consisting of France, Italy, Czech Republic, Hungary, Lithuania, Estonia, and Latvia rejected the agreement and therefore the Directive remains unadopted. This means rejecting or at least postponing until the next Belgian presidency of the Council of the European Union the adoption of what is considered to be one of the major milestones in European social legislation, as this EU law aims to protect those who are perhaps among the most vulnerable workers, insofar as they are often denied even their status as workers. This means denying them the application of labour rights and social security protection enjoyed by other workers.

For the time being, this will affect only a small number of people. According to data from a pilot survey conducted in 17 EU countries in June 2023 (not including Spain), only 3% of the European workforce has worked for pay on platforms for at least 1 hour a day for at least 1 week. However, the power of platforms should not be measured by the number of people they currently employ, which is likely to grow, but by their ability to organise work in a way we have not known before.

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The matrix of the business model of digital labour platforms is the use of algorithms and artificial intelligence (AI) systems. This can have an effect that we could call the fragmentation, commodification and casualisation of work. The use of algorithms or AI systems allows real-time matching of supply and demand for products and services. This, in turn, makes it possible to calculate with complete precision where, when, and how much labour will be needed to meet customer demands and to direct by means of behavioural nudges the strictly necessary number of people governed by algorithms or AI to the strictly necessary place or time to do so. This is one of the main competitive advantages of using algorithmic management for platforms. For work, however, it implies the possibility of fragmenting the provision of work and using by the company the strictly necessary fragment, for the strictly necessary time and in the strictly necessary place.

This possibility radically changes the way we have understood the provision of labour up to now. It is now possible to “buy” the labour that is strictly necessary to satisfy the demand for products or services that, at a given time and place, the company has, needs that are known in real time through the use of algorithms and AI and their ability to forecast how and when consumer demands occur. This is what is considered as labour marketing, i.e. the “buying” of the piece or fragment of labour needed to satisfy the demands for goods and services at the precise time and place. This is little like the hiring of a person who will personally carry out his or her professional activity over time and in a place prefixed, normally, by the location of the company. The labour institutions we know about salary or working time are designed for the latter model, but they hardly fit with the possibility of “buying” the fragments of work facilitated by the platform’s use of algorithms and AI.

This can lead to a very intense process of precariousness, in the sense of very short-term employment relationships, unstable in their duration over time and resulting in equally unstable and, as a rule, moderate incomes. Moreover, this depersonalisation of work, where the focus is on the work itself and not on the person who performs it, is the perfect breeding ground for the questioning of the employment contract itself, which we have always understood as having an intuitu personae character. “Buying” work is much more akin to hiring a service than a person to perform it, which favours the use of self-employment, typical of the contracting of services, to the detriment of the employment contract, typical of the contracting of persons. Finally, the very configuration of the company is compromised by these processes of fragmentation and commercialisation of work. Through the use of algorithms or AI systems, fragments of work scattered across the world can be coordinated, with no need for any other factor of production than the necessary technological tools and no more location than an application on workers’ mobile phones or computers.

This is not a dystopian vision of work and business. It is a reality that already exists. Digital online work platforms are the paradigm of what has just been explained and, more than companies with a physical presence, they are virtual and global labour markets where fragments of work are “bought” and “sold” in exchange for a price, with no other support for their operation than the algorithms or AI systems that make it possible.

This is why the rejection of the Directive is bad news, given that, if there is no guaranteeing regulation of work on platforms, it will be the very concept of work itself that will be in danger of extinction. 
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