WorkLife 2.0: a new 'rider law' in Spain that will affect a part of the gig economy

The Spanish government has ratified a new Royal Decree-law on guaranteeing the labour rights of individuals engaged in delivery services offered by digital platforms.

Known as the 'rider law', it follows more than six months of trilateral negotiations between the Ministry of Labour, trade unions and business associations, until it was adopted on 11 May. 

It also comes after a 2020 ruling from Supreme Court (STS 805/2020), which decided that a rider offering their services to a food-delivery platform was an employee. The Court’s decision was based on the presumption of employment that derives from article 8.1 of the Workers Statute, which says that there is an employment relationship 'between anyone rendering a service on behalf of and within the scope of the organisation and management of another, and the person receiving that service in exchange for compensation paid to the former'.

Although the case was limited to the assessment of a particular platform, the rationale of the judgment implied that most riders would be considered as working within the scope of an organisation providing food delivery services. Therefore, given that the circumstances of the case are common to most platform operators, the Supreme Court decision could have an impact on businesses operating in the platform economy as a whole.

Most food delivery 'riders' in Spain used to render their services under a 'third category' of services called trabajador autónomo económicamente dependiente (economically dependent independent worker), also referred to as 'TRADE', which is effectively a self-employed status with some additional rights.

The rider law aims to further clarify the issue and adjusting labour regulations by introducing two modifications to the Workers’ Statute:

1. A clarification of the principle set out in article 8.1. The new provision states that 'riders', ie individuals who provide remunerated services involving the delivery of any consumer product or merchandise, shall be considered employees. However, this will only apply if 'the company exerts powers of organisation and direction, by co-ordinating the provision of services or working conditions, through a digital platform'.
2. An amendment to the section of the law on information and consultation rights of works councils. This gives a works council the right to be informed by the company of the parameters, rules and instructions that algorithms or artificial intelligence systems are based on, provided that they affect decision-making, working conditions, access to employment and its maintenance, including profiling.

The rider law shall come into force on 10 August (90 days following its publication in the Spanish Official Gazette on 12 May). Therefore, companies that fall within the scope of this law have a short timeframe to take any necessary measures to comply.