The Traced Liability of Digital Platforms

Caroline Thrane-Møller & Lisa Maria Kahlen Petersen

Student thesis: Master thesis

Abstract

In Denmark the sharing economy is growing and today approximately one out of five Danes are participating in its many activities. Hence, a new business model within the sharing economy has arisen where digital platforms offer their services on a freelance basis. These labour platforms pose new legal challenges, especially in relation to the employment status of the platform worker. The dissertation at hand is a study of the extent to which businesses Happy Helper, Hilfr and alike are in fact entering into an employment and what consequences these would face becoming employers rather than intermediaries. The paper seeks to evaluate whether it is economically optimal for Happy Helper and Hilfr to become legally liable of workers by looking at contemporary Danish legislation. The legal analysis has primarily been to determine how and when the existence of an employee takes place. Through legislation and literature, the chosen definition of an employee is based on five given criteria, that must be met for a worker to be considered an employee. The given criteria are applied to the platforms’ relationships where it is found, that even though the criteria show evidence of a possible employment, the contemporary legislation does not appear to allow a concrete, conclusive, legal position on the digital platforms. Unless a more modern and dynamic approach is applied, it will be difficult to place the digital platforms as legal employers of the workers finding work via their digital platforms. The principal-agent theory is applied to the economic analysis in order to characterize the trilateral relationship between business, worker and consumer. The economic optimality of employee liability is evaluated based of Happy Helper and Hilfr’s respective risk profiles, legal information, and contracts. Conclusively it is found that it is not economically feasible for Happy Helper nor Hilfr to become legally liable of workers due to, among other, that consumers are unaware of Happy Helper and Hilfr’s intermediary configuration. The argument is supported by the fact that terms and conditions are not fully read when accepted by consumers. However, if consumers’ likeliness to buy into the platforms’ services changes over time the risk of liability of workers might become financially worthwhile in the long term. Finally, the integrated analysis concludes that it is efficient for society to allocate liability to Happy Helper and Hilfr. Hence, suggestions are offered on how legislator should approach the digital platforms in the future – either by an assessment by court or a new law, covering both consumers, workers and platforms rights

EducationsMSc in Commercial Law, (Graduate Programme) Final Thesis
LanguageDanish
Publication date2019
Number of pages129
SupervisorsHenrik Lando & Kim Østergaard