Crowdworking and employment law: the 4 most important questions and answers
Nowadays, crowdworking and corresponding provider platforms such as AppJobber, Freelancer or Clickworker are becoming increasingly popular. Companies are tempted by the opportunity to work conveniently and flexibly from home via the internet. However, many activities and employers do not give a particularly reputable impression. Employees who work in crowdworking / crowdsourcing are often seen as an army of digital day laborers.
We want to approach this important topic from an employment law perspective and answer the most important questions on the subject of crowdworking / crowdsourcing for you.
The most important facts about crowdworking in our overview:
- Crowdworking is a form of work that is growing in popularity and will also become increasingly important for employment law.
- As a rule, crowdworking is a self-employed activity. However, the individual case must be examined! In principle, a normal employment relationship or pseudo self-employment may exist!
- Pay attention to the type of orders and the form in which you are required to execute them!
- There are only a few court rulings and no uniform case law on the subject of crowdworking, so seek legal advice if the worst comes to the worst!
Table of contents:
- What is crowdsourcing or crowdworking?
- Are crowdworkers self-employed or employed?
- Beware of bogus self-employment with crowdworking!
- Outlook for employment law issues relating to crowdworking
What is crowdsourcing or crowdworking?
Crowdworking or crowdsourcing is a relatively new form of work that is also becoming increasingly popular in Germany. Companies offer jobs to registered users, also known as crowdworkers, via crowdworking platforms such as Clickworker or Freelancer. Classic jobs for crowdworkers include entering data or producing texts and short messages. However, it can also involve more complicated and time-consuming projects such as programming apps.
Many of the tasks have a low volume of work and can be completed in a short time. They are therefore often referred to as "microjobs". Crowdworkers can apply independently for projects and jobs that interest them. The client decides who gets the job, for example using an evaluation system set up by the crowdworking platform.
Are crowdworkers self-employed or employed?
For many crowdworkers, but also for clients on crowdworking platforms, it is unclear whether crowdworkers should be classified as employees or self-employed.
According to Section 611a I of the German Civil Code (BGB), the decisive factor for an employee's status as an employee is whether they are bound by their employer's instructions. However, since crowdworkers can freely organize their working methods and working hours, it cannot generally be assumed that they are bound by instructions in the case of crowdsourcing. This is precisely defined in Section 611a I 3 BGB by the fact that an activity cannot essentially be freely organized and, for example, working hours are determined by the employer.
The principle of crowdworking is based on the independence of the contractor. As a rule, there is no dependency on the client; instead, the crowdworker chooses the client themselves and also works for a large number of changing clients. They also provide their own resources such as an Internet connection, PC or laptop.
The classification of crowdworkers as self-employed for the reasons stated above was also confirmed by the Munich Labor Court in general in 2019 (judgment of 20.2.2019, Ref. 19 Ca 6915/18).
According to a last-instance ruling by the Federal Labor Court (BAG) on this specific case from December 1, 2020 (Ref. 9 AZR 102/20), the classification of the employee status of a crowdworker must also be examined to determine whether the crowdworker is in an employment relationship with the crowdworking platform, which acts as an order broker. This is the case if the contractor is steered by the platform via incentive systems or the exertion of pressure in the direction of accepting (certain) orders and or completing a fixed volume of work. In the specific case, the BAG even awarded the crowdworker, who was classified as an employee, a claim for back pay from the platform as the employer.
Beware of bogus self-employment with crowdworking!
However, there are other specific constellations in which a crowdworker cannot be classified as self-employed. As with regular self-employment, the following also applies to crowdworkers: Beware of bogus self-employment!
Working via a crowdworking platform offers the opportunity to apply for a large number of jobs, the majority of which can be completed in a self-employed capacity. There is usually a specific deadline by which an assignment should be completed and the contractor is free to act as they wish to fulfill the assignment. However, you should be careful with certain types of contracts and constellations so that you do not slip into bogus self-employment:
- Working according to the client's instructions: Pay attention to whether the client makes use of a right to issue instructions that should only be incumbent on them as an employer. Pay close attention to whether you are given binding instructions regarding your place of work (e.g. in a company), your working hours, your working time or your type of work.
- Integration into the client's work organization: Pay attention to whether you have a fixed role in the client's organization. Working at a workplace in the company with the provision of work equipment by the client is a clear warning signal. Other indicators are continued remuneration in the event of illness, entitlement to company social benefits, vacation entitlement and overtime pay.
As a self-employed person, you should also work for various clients - preferably on an ongoing basis.
Although there have not yet been any rulings in the past that have proven the bogus self-employment of crowdworkers for individual clients, it is only a matter of time before such examples become relevant in legal practice!
Outlook for employment law issues relating to crowdworking
Crowdworking is a highly relevant topic in employment law, in which only a few rulings have been made to date, but which do not provide sufficient legal certainty. Individual cases are assessed on the basis of the relevant legal norms, which did not provide for and were not aware of this type of Work 4.0.
The legislator announced in a key issues paper that crowdworkers would be included in the statutory pension insurance scheme and that contributions would be paid by platforms. However, there is no concrete draft legislation on this yet and it is questionable when and whether any laws will come into force.
Up to this point, crowdworking is an area of employment law in which each individual case must be examined extensively and conscientiously. Therefore, if you have legal concerns as a crowdworker, there is no way around an expert lawyer!
Do you have employment law or tax-related questions about crowdworking?
Contact the law firm Haas und Kollegen now:
Rudolf-Diesel-Str. 5, 65760 Eschborn near Frankfurt