The liberalization of the French employment framework has been accelerating with the evolution and the digitalization of the economy and especially with the labor reforms of 2016/2017.
With the intensification of the e-mobility digital market and the rapid mutation of the services offered, the French Government has felt the necessity to create a new legal framework specifically designed for digital platforms/apps in order to regulate their activities, protect the consumers whilst introducing further flexibility in terms of operations and in particular for their workforce.
Indeed, most of the apps’ workers are not employed by the apps. Instead, they are service providers, apps playing only the role as an “agent” between the app users and the workers. The business model of most referral apps is not compatible with the traditional French salaried employment legal framework consisting of having employees working under a subordinate relationship of one employee who has a power to instruct, control and sanction them.
At the same time, apps workers accepting a job as independent contractors implies that they take business risks as every entrepreneur does and that they have to renounce their protected status which French employment law has set for salaried employees, such as the right to a minimum wage, regulated working time, national healthcare and welfare insurance, severance termination indemnities, etc.
Since the Law on the Digital Republic of 7 October 2016 (“Loi pour une République numérique”) , digital apps offering referral services carry a “social responsibility” towards independent workers who are providing services . Indeed, the apps should take in charge the insurance contribution that the workers would have to subscribe to prevent the risk of work accident. They should also take in charge their professional training up to a certain limit and subject to certain conditions in terms of revenues generated by the workers on the app.
The new Law on Mobility Orientations dated the 24 December 2019 (LOM), enacted on 27 December 2019 (subject to several subsequent decrees of application that are still awaiting publication) are reinforcing the “social responsibility” obligations on digital apps operating on the new forms of mobility, i.e. transport of persons with a driver or delivery services, called “e-mobility apps”.
Article 44 of LOM has imposed on these e-mobility apps the following obligations to:
- communicate to the workers the distance of the service required and the minimum guarantee price that they would receive,
- publish on their internet website in a loyal, transparent and clear manner the indicators relating to the duration of activity and the revenue generated by the workers using the app for the past civil year.
New Article L. 1326-2 of the French Transport Code specifies that independent workers have the right to refuse to provide a transportation service without being subject to any fines. In particular, the e-mobility app cannot end the service agreement with independent workers based on one or several refusals of service.
LOM has also set the possibility for these e-mobility apps to implement a policy or charter aiming at defining the conditions and modalities of the social responsibility and detailing the rights and obligations of independent workers. Under certain conditions that need to be specified by an upcoming decree and after a consultation of independent workers to be organized by the app, such policy/charter can be communicated to the Labor administration which can examine the compliance of its content.
Originally, this policy/charter was intended to end all possible claims to requalify the independent worker relationship into a salaried employee relationship when such policy/charter is validated by the Labor inspection.
However and without surprise, by Decision dated 20 December 2019 (n° 2019-794 DC), the French Constitutional Council has declared such legal provisions unconstitutional since only the French judges have the power to examine and requalify any independent worker’s situation into an employment relationship by characterizing the existence of any subordinate relationship.
Still, one can guess that issuing such charter and complying with LOM’s provisions may increase the chance to have the independent workers’ business model strengthened, when apps do not favor the employee model.
Also, on 14 January 2020, the Prime Minister, Mr. Edouard Philippe, has entrusted Mr. Jean-Yves Frouin, former President of the Labor Section of the French Supreme Court (Cour de Cassation), with a mission to define different possible scenarii to frame the representation of workers of digital apps in order to guarantee a balanced dialogue with digital apps and allowing them to contribute to a more structured work conditions for the independent workers.
While in the US, notably with the AB Bill in California, the tendency is to reshape the gig economy by forcing app-based companies to treat workers as employees, one can praise France for not having adopted such a drastic move, especially with all the new business opportunities from the “Maas” (“Mobility as a Service”) digital offers that were provided by LOM.
Indeed, LOM has also granted the existence of multimodal apps in France which will be allowed to offer different types of transportation services, from calculating distance to booking different ways of transport (VTC, electric self-service bike, e-scooters, etc.), by using one single app.
One can only expect that apps like Uber, Amazon, Deliveroo, etc. which today can refer clients (BtoB or BtoC) to business partners (drivers, restaurants, retailers, etc.) will seize these new business opportunities thanks to LOM. On the VTC sector, according to a global study on the global transport for the Paris region, it has solely generated work opportunities for 80.000 people in this region in 2018 with around EUR 1.3 billion of additional tax resources. Regarding the e-scooter, the market has reached more than 278 million euros in France with an increase of 76% for 2018.
The ability to choose and master the best work pattern would definitively be key for apps players in order to fully enjoy the opportunities of the French market.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.