Introduction
This essay examines the legality of Directive 2024/2831 of the European Parliament and of the Council on improving working conditions in platform work (the Platform Work Directive or PWD), adopted on 24 October 2024, focusing on the principle of subsidiarity as outlined in Article 5 of the Treaty on European Union (TEU). The analysis centres on the objections raised by a fictional EU Member State, referred to as Member State A (MS A), which argues that the Directive violates subsidiarity due to significant differences in national labour market conditions across Member States. MS A contends that these disparities render a uniform EU solution ineffective and that the Directive’s objectives could be better achieved at the national level. This essay evaluates both sides of the argument: in favour of MS A’s position that EU legislation oversteps subsidiarity, and against it by supporting the European Commission’s view that EU-level action is justified. Through a detailed legal analysis, supported by academic sources and EU legal principles, the essay aims to determine whether the adoption of the PWD satisfies the subsidiarity test. The discussion will explore the concept of subsidiarity, the specific challenges posed by the PWD, and the implications of national diversity in labour markets.
Understanding the Principle of Subsidiarity in EU Law
The principle of subsidiarity, enshrined in Article 5(3) TEU, is a cornerstone of EU governance, designed to ensure that decisions are taken as closely as possible to the citizen. It stipulates that the EU should only act in areas of shared competence if the objectives of the proposed action cannot be sufficiently achieved by Member States at the national, regional, or local level, and can be better achieved at the Union level due to the scale or effects of the action (Craig and de Búrca, 2020). This principle serves as a check on EU legislative overreach, balancing the need for uniform action with respect for national diversity. The Protocol on the Application of the Principles of Subsidiarity and Proportionality (Protocol No. 2) further mandates that EU institutions provide reasoned statements demonstrating compliance with subsidiarity, including evidence of why national action would be insufficient.
In the context of the PWD, subsidiarity is particularly relevant as the Directive addresses labour conditions in platform work, an area of shared competence under Article 153 of the Treaty on the Functioning of the European Union (TFEU), which governs social policy. The controversy surrounding the Directive highlights the tension between the EU’s ambition to harmonise standards and the diverse labour market realities across Member States, raising the question of whether a centralised approach can effectively address such a fragmented policy area (Barnard, 2017).
Argument in Favour of MS A: Subsidiarity Violation
MS A’s position rests on the assertion that the objectives of the PWD—improving working conditions for platform workers—can be sufficiently achieved at the national level due to significant differences in labour market conditions across Member States. Indeed, labour markets in the EU vary widely in terms of unemployment rates, wage levels, unionisation, and the prevalence of platform work, reflecting distinct historical, economic, and cultural contexts (Eurofound, 2020). For instance, while some Member States may have a highly regulated labour market with strong protections for gig workers, others, like MS A, might prioritise flexibility to support small and medium-sized enterprises (SMEs) operating through digital platforms. MS A’s national parliament conducted extensive consultations, concluding that the PWD would impose an unreasonable administrative burden on SMEs and hinder their ability to offer services effectively. This evidence suggests that a one-size-fits-all approach, as embodied in the Directive, may fail to account for such national specificities.
Furthermore, MS A argues that national laws are better equipped to address the unique challenges of platform work within their jurisdictions. Subsidiarity requires the EU to demonstrate that Member States cannot achieve the desired outcomes independently, yet MS A contends that existing national mechanisms, tailored to local conditions, are more effective (Weatherill, 2016). The administrative obligations imposed by the PWD, such as reporting and information requirements, may disproportionately burden SMEs in MS A, where resources for compliance are limited. This perspective aligns with the view that EU intervention should not occur when national action is both possible and preferable, thus supporting MS A’s claim of a subsidiarity violation.
Argument Against MS A: Subsidiarity Test Satisfied
Conversely, the European Commission’s position holds that EU-level action is necessary to address the transnational nature of platform work and achieve consistent protection for workers across the Union. Platform companies, such as Uber, operate across multiple Member States, often exploiting regulatory discrepancies to minimise labour costs and circumvent protections (De Stefano, 2016). This cross-border dimension arguably necessitates a harmonised approach, as fragmented national laws may lead to a ‘race to the bottom’ in worker protections, undermining social policy objectives. The Commission could argue that only EU legislation can ensure a level playing field, preventing platforms from relocating to Member States with less stringent rules, a concern that national action alone cannot adequately address (Barnard, 2017).
Moreover, the scale of platform work’s growth and its impact on labour markets across the EU supports the need for Union-level intervention. Recent data suggests that platform work engages millions of workers across Europe, with significant variations in conditions and legal status (Eurofound, 2020). A common EU framework, such as the PWD, can set minimum standards, ensuring that workers in all Member States benefit from baseline protections while allowing flexibility for national implementation. The Commission might further contend that the administrative burdens cited by MS A are proportionate to the objective of safeguarding workers’ rights, thus satisfying the subsidiarity test by demonstrating that EU action achieves better outcomes than disparate national measures (Craig and de Búrca, 2020).
Analysis and Evaluation
Evaluating these arguments requires a nuanced application of the subsidiarity principle. On the one hand, MS A’s emphasis on national diversity in labour markets is valid, as evidenced by disparities in regulatory approaches and economic conditions across the EU. The burden on SMEs, as highlighted by MS A’s consultations, indicates that the PWD may have unintended consequences that undermine its objectives in certain contexts. On the other hand, the transnational nature of platform work and the risk of regulatory arbitrage by platforms provide a compelling case for EU intervention. The Commission’s rationale—that harmonised standards prevent exploitation and ensure fairness—appears to align with the requirement under Article 5(3) TEU that EU action must offer added value over national measures.
However, the subsidiarity assessment also hinges on whether the EU has provided a reasoned justification for its legislative action, as required by Protocol No. 2. If the Commission’s impact assessment and explanatory memorandum adequately demonstrate why national action is insufficient, MS A’s challenge may lack legal grounding. Conversely, if the evidence is inconclusive or overly general, ignoring specific national concerns like those raised by MS A, a violation of subsidiarity could be argued. Given the hypothetical nature of this case, it remains uncertain which side would prevail in a legal challenge before the Court of Justice of the European Union (CJEU), but the balance seems to tilt slightly towards the Commission, provided its reasoning is robust.
Conclusion
In conclusion, the debate over the legality of the Platform Work Directive under the principle of subsidiarity encapsulates the broader tension between EU harmonisation and national diversity. MS A’s argument that national laws are better suited to address platform work due to differing labour market conditions highlights a legitimate concern about over-centralisation, potentially violating subsidiarity. However, the Commission’s position that EU-level legislation is necessary to tackle the transnational challenges of platform work appears more persuasive, given the scale and cross-border effects of the issue. Ultimately, the resolution of this dispute would depend on the quality of evidence and reasoning provided by the EU to justify its action. This case underscores the importance of rigorous subsidiarity assessments in EU policymaking, ensuring that legislative interventions genuinely add value while respecting Member States’ autonomy. The implications extend beyond the PWD, shaping future debates on the balance of power between the EU and its Member States in areas of shared competence.
References
- Barnard, C. (2017) The Substantive Law of the EU: The Four Freedoms. 6th ed. Oxford University Press.
- Craig, P. and de Búrca, G. (2020) EU Law: Text, Cases, and Materials. 7th ed. Oxford University Press.
- De Stefano, V. (2016) The Rise of the ‘Just-in-Time Workforce’: On-Demand Work, Crowdwork, and Labour Protection in the ‘Gig-Economy’. Comparative Labor Law & Policy Journal, 37(3), pp. 471-504.
- Eurofound (2020) Platform Work in Europe: Evidence from the European Working Conditions Survey. Publications Office of the European Union.
- Weatherill, S. (2016) Law and Values in the European Union. Oxford University Press.
