Abstract
This special issue of the European Journal of Social Security explores the complexities of extending unemployment insurance to the self-employed and platform workers in the EU Member States and the steps taken at EU level to enforce the protection offered at national level. Traditionally, social security systems have been designed for standard employment relationships, leaving a typical workers and the self-employed inadequately protected. The European Pillar of Social Rights (EPSR), adopted in 2017, and the subsequent 2019 Recommendation on access to social protection have marked a shift towards more inclusive social security frameworks. However, significant gaps in coverage remain, in particular with regard to unemployment protection for the self-employed and platform workers. The special issue is divided into three parts: national perspectives, comparative studies and EU-level discussions.
Keywords
Introduction
Improving the social security protection of atypical workers 1 and the self-employed has been high on the EU agenda in recent years. Marking a departure from a period of budgetary restraint and economic monitoring, the adoption of the European Pillar of Social Rights 2 (hereinafter: EPSR) in 2017 heralded a renewed commitment to the prioritisation of social considerations (Garben, 2018: 212–215). Referred to by some as the ‘last chance for Social Europe’ (Aranguiz, 2022: 78), the EPSR emerged as a response to the call for a stronger social Union. The EPSR was reaffirmed as a tool for social policy guidance in the La Hulpe Declaration (2024).
Article 12 EPSR contains the right to adequate social protection, a concept further refined by the Recommendation on access to social protection for all workers and the self-employed (hereinafter: the 2019 Recommendation). This pivotal recommendation aimed to address the longstanding critique that the EU's social security model remained ‘hidden’, with budgetary and labour market concerns seemingly taking precedence over social objectives in the European Semester and the Europe 2020 Strategy (Schoukens, 2016; De Becker, 2016; Dawson, 2017: 185 and further). The 2019 Recommendation urges the EU Member States to ensure adequate access to social protection for all workers, regardless of their employment relationship, and the self-employed.
In spite of the recent initiatives launched, EU Member States struggle to include atypical work forms and the self-employed adequately in their social security schemes. This is also made clear by the report on the implementation of the 2019 Recommendation, which shows that important coverage gaps remain in EU Member States, particularly in the case of unemployment protection for atypical workers and the self-employed (European Commission, 2023a; European Commission, 2023b and, earlier, Spasova et al., 2021). Under the Spanish and Belgian presidencies of the Council (July 2023 – December 2023 and January 2024 – June 2024), the need for strengthening social protection for all has been stressed once more. For example, the Council Conclusions of 9 October 2023, on the social protection of the self-employed, underlined the need to extend the social protection coverage for the self-employed (see also the discussion in Eurofound, 2024 on the different coverage gaps which exist, in particular for unemployment).
The past years have proved to be an important test for the EU and its Member States, including their social security schemes. Immense challenges, such as the Covid-19 crisis, the Ukrainian war and the energy crisis, required the EU and EU Member States to take additional steps to strengthen social protection schemes, as well as extending the protection to certain atypical work forms and the self-employed. Such moments of crisis reveal the strength of social protection systems. For instance, in the Covid-19 crisis, all EU Member States relied on job retention schemes safeguarding employment. Often backed by the SURE instrument (see also the discussion in De Becker, 2024a and Panayiotis and Bekker 2023), activation of such force majeure measures could, in the future, be systematically tied to the European level (Weber and Yilmaz, 2023). However, the Covid-19 crisis revealed once more the gaps in national social security schemes and the vulnerability of groups falling outside these schemes (Eurofound, 2024).
In order to include atypical workers and the self-employed in an adequate manner in social security systems, more research is needed on the specificities of different work forms and how to adapt social security systems accordingly. That way, social security systems can be made more resilient in the future, and adequate social protection can be guaranteed for all kinds of work. In order to facilitate such cross-border research, the European Institute of Social Security, an international scientific network, established a new working group on atypical work in 2021. The third anniversary, in November 2022, of the 2019 Recommendation, and the experience of the Covid-19 crisis were seen by the working group as providing a window of opportunity to reflect on how to make unemployment schemes more resilient in the future. The erratic work patterns and income fluctuations of some atypical workers pose important challenges for EU Member States in delivering adequate income replacement during periods of unemployment. In this regard, the working group initiated a common statement on challenges and the direction of the next steps for social security (Schoukens and Weber, 2022). The underlying special issue explores these issues.
The challenge posed by atypical work and self-employment for social security schemes
The employment landscape has witnessed significant transformations, marked by an increase in non-standard work forms alongside the traditional standard employment relationship. Even though the latter remains predominant in modern-day labour markets (Eurostat, 2022) and guarantees the most developed labour and social security protection, atypical work forms such as part-time work, temporary employment and (solo) self-employment have become increasingly prevalent and diverse. Such work forms often occupy a grey zone between employment and self-employment (ILO, 2015).
Around 13–14% of the workforce in the EU are self-employed (Eurostat, 2022). 3 An important trend is the changed composition of the group of self-employed in the EU, with an increase in solo self-employment. More precisely, in the third quarter of 2021, more than two-thirds of self-employed (68.2%) in the EU were solo self-employed (Eurostat, 2022; see also for an earlier discussion Spasova and Wilkens, 2018). The economically dependent self-employed constitute a non-negligible group (+/- 20% of the solo self-employed in the EU, 4 according to 2017 data retrieved from Eurostat, 2018). A similar increase can be noted in most OECD countries (Boeri et al., 2020), underscoring the global nature of this phenomenon (figures: OECD, 2023). Other non-standard work forms have also been on the rise in recent decades. Part-time work accounts for 17% of the workforce in the EU (year 2022, Eurostat 2023a). Temporary workers constitute around 12.1% of the EU labour market (year 2022, Eurostat 2023b), with important differences between EU countries.
The cited numbers show a more complex web of labour market relations. The organisation of labour is becoming more flexible, due to, among other things, growing digitalisation, market pressures and personal preferences. Flexible work forms create various challenges for the organisation and financing of work-related social security schemes, traditionally designed with the standard worker in mind. More and more workers no longer have a nine-to-five job, nor do they always work for one employer. Their income may be irregular and dependent on the number of assignments and negotiated rates rather than on their hours of work (De Becker, 2024b). Many social security systems stem from the first industrial revolution and thus need to adapt their strengths to a changing world. In order to encompass new work forms, social security schemes have to be reshaped. Applying existing schemes, originally designed for standard work situations, will not always suffice, as earlier research has shown (Aranguiz, 2024). This means that solutions need to be more fundamental, while preserving the essentials of social security: guaranteeing decent income replacement if a social risk (such as unemployment or long-term illness) materialises, and ensuring compensation for serious costs which may be faced by individuals or households (such as for health and social care).
Outline of the special issue
In the ever-evolving landscape of labour markets, the concept of traditional employment has undergone a transformative shift, giving rise to diverse forms of atypical work and strong differences between the various types of self-employment. These work arrangements, characterised by their departure from the standard employment agreement, bring both opportunities and challenges to national social security schemes, particularly for short-term income replacement benefits such as unemployment.
This special issue of the European Journal of Social Security examines coverage in case of unemployment for two groups for whom it is difficult to provide such coverage: self-employed persons and platform workers. Earlier research shows that these groups face particular difficulties in accessing social protection coverage for (short-term) income replacement benefits, such as unemployment benefits (European Commission, 2023a; Eurofound, 2024). Unemployment protection for self-employed persons concerns a group of persons who have traditionally been perceived as having no need for unemployment coverage in light of the entrepreneurial risk aspect of their self-employment (see Schoukens and Weber in this special issue and Eurofound, 2024). In recent years, the group of self-employed has also strongly changed, including more and more (economically dependent) solo self-employed (see the figures cited above), blurring the lines between self-employment and employment. Platform work is a rather recent phenomenon and an example of how labour markets have been transformed due to new digital evolutions. For these workers, much uncertainty as to their labour status remains to this day. Moreover, some studies show the limited earnings from platform work, as well as irregular work patterns, which pose significant challenges to their unemployment coverage, even if they can be considered to be employees (De Becker et al., 2024).
This special issue is structured in three interconnected parts: (a) national perspectives that provide detailed country-specific analyses; (b) comparative studies drawing cross-country lessons; and (c) EU-level discussions that examine the role of EU policies and coordination mechanisms in shaping unemployment protection for atypical workers, such as platform workers, and the self-employed.
Unemployment protection: a country-discussion
The first part, comprising multiple contributions, explores the distinctive social security landscapes across the EU Member States. When selecting countries, we opted for a geographical division, and included different policy responses designed to provide protection for platform workers and the self-employed. The countries selected are Austria (Thomas Pfalz), Belgium (Eleni De Becker and Charlotte Bruynseraede), Denmark (Catherine Jacqueson), Estonia (Johanna Vallistu), Hungary (Nóra Jakab), Spain (María Salas Porras) and Switzerland (Sabrine Magoga-Sabatier). We also chose to include in the comparative analysis a non-EU Member State. Thus Switzerland, with its specific democratic model, can provide an interesting test case to see if and how changes necessary in light of labour market reforms can be introduced in close dialogue with the Swiss people via referenda.
The reason for including country discussions in the special issue is to further develop and strengthen the academic and policy debate, by creating a common understanding and language concerning the problems countries might face when trying to include atypical work forms in their social security systems. In order to conduct a thorough and in-depth study, we use a common framework to look at the different countries. This should allow us to compare the current types of protection and identify some good practices, but also to look ahead at new developments and reflect on the role of the EU.
The common framework consists of four elements that are addressed in the various papers:
(a) An introduction, in which the authors situate the unemployment protection in the overall national social security scheme and explain how self-employed persons and platform workers fit into the current social security and unemployment framework; (b) An overview of the personal scope of unemployment protection for self-employed persons and platform workers, addressing if and to what extent those two groups are (mandatorily or voluntarily) covered in case of unemployment; (c) An overview of the unemployment protection provided for self-employed persons and platform workers, if the protection provided differs from the protection offered to employees. Elements that should be discussed are the applicable entitlement conditions, the type of unemployment benefit(s) provided, the duration of the benefit, and how the unemployment benefit is financed; (d) Policy debate and prospects: this last section analyses the ongoing policy discourse on unemployment protection for the self-employed and platform workers in the given country. In this section, recent developments and/or legislative proposals and the lessons learned for other countries should be discussed.
The above approach enables a comprehensive analysis to be carried out of unemployment protection for the self-employed and platform workers, fostering productive cross-country insights and comparisons.
Thomas Pfalz examines the unemployment protection system for the self-employed and platform workers in Austria. Employees and the self-employed are insured under the same unemployment scheme in Austria. However, different rules apply to the self-employed. Unlike employees, self-employed persons can voluntarily opt for unemployment insurance. Pfalz (2024) shows, as in earlier research, the limited take-up of such voluntary unemployment insurance, with only around 0.43% of the self-employed participating (July 2022). Additionally, self-employed persons are free to choose their contribution level, which affects the unemployment benefit they receive. Pfalz also wonders to what extent the pooling together of self-employed persons and employees in one scheme creates constitutional concerns regarding the principle of equality. Moreover, he argues that it also remains unclear to what extent the applicable rules, originally tailored to employees, fully apply also to the self-employed (e.g. ability to work, willingness to work and the calculation of unemployment benefits). As for platform workers, they are not treated as a separate category, but the protection they receive depends on how they are classified – either as employees and employee-like persons (mandatory unemployment coverage) or as self-employed persons (voluntary coverage, and in some cases mandatory coverage if they have previously worked as an employee or employee-like person). In particular, low-income (employee, employee-like or self-employed) platform workers face important coverage gaps. They are excluded from unemployment protection if their income falls below a certain threshold. As platform work is often fragmented and earnings are low, these workers often receive little protection against unemployment.
In Belgium, the self-employed are excluded from unemployment protection under the general scheme for employees. As in Austria, self-employed persons who were previously insured as employees can receive unemployment protection for employees if they cease to be self-employed. Belgium has also developed a specific protection for the self-employed (the bridging right scheme). This scheme is limited to pre-defined events (e.g. economic difficulties, bankruptcy, etc.) and has recently been reformed to increase take-up. However, self-employed persons with a secondary activity are excluded from coverage, and Eleni De Becker and Charlotte Bruynseraede (2024) argue that this scheme is not well suited to economically dependent self-employed persons. In addition to the bridging right scheme, a specific regime has also been established to deal with future crises, giving the legislator the possibility to swiftly introduce temporary income protection measures for the self-employed in case of exceptional events. Platform workers are covered according to their work status: either as self-employed or as employees. In particular cases of marginal platform activities, however, it is possible that the platform worker is considered neither as an employee nor as self-employed, but instead falls under a special scheme, the so-called De Croo scheme, without any social security coverage. Here again, low-income platform workers face significant difficulties in accessing unemployment protection.
Catherine Jacqueson (2024) discusses the position of the self-employed and platform workers in Denmark and their access to unemployment benefits. Jacqueson highlights the unique approach of Denmark in integrating self-employed individuals into its unemployment protection scheme. In 1976, the Danish model, characterised by its flexibility and inclusiveness, extended formal access to unemployment benefits to self-employed persons. The recent reforms have introduced a shift in the Danish scheme, with the emphasis no longer placed on the previous labour market status of the unemployed person, but rather on the activity performed. These changes concern the way in which the qualifying period is calculated, as well as the possibility of combining income from various professional activities to fulfil the qualifying period. The changes made seem more suited to the evolving labour markets in the EU and potentially strengthen the protection provided for the self-employed. However, despite this progress, Jacqueson argues that several barriers remain, particularly the voluntary nature of insurance and stringent eligibility criteria, which hinder effective protection for the self-employed. Platform workers, who often operate under fluctuating conditions on a low income, face additional challenges, such as proving involuntary unemployment and meeting the eligibility thresholds, which further complicate their access to unemployment benefits.
Under Estonian law, there are various forms of self-employment, resulting in a myriad of different rules. Only those in some – less common – forms of self-employment are entitled to unemployment coverage. It is also not unusual, Johanna Vallistu (2024) argues, to engage in multiple types of work relationship as a self-employed person or combine self-employment with an employment relationship. This constitutes an important hindrance to unemployment coverage, as an unemployed person cannot have any ongoing activities or labour income. What differentiates platform workers from the self-employed in general is that platforms mostly do not provide a choice of legal status, and the actual status of platform workers depends mainly on the approach chosen by the platform. Whilst they could work under the scheme for employees, this is less common and the income earned from platform work is often limited; it is therefore likely that such workers combine various income sources at the same time, possibly ruling out effective access to unemployment coverage.
In Hungary, self-employed persons and platform workers are required to be insured against unemployment, similarly to employees, as the same rules generally apply to all insured persons regardless of their labour status. However, reduced contribution rates can be applied for, which lower the level of unemployment benefits received or even exclude the (self-employed) platform workers from unemployment protection. As discussed by Nora Jakab (2024), many self-employed individuals report their income at the minimum level required to qualify for these reduced contribution rates. The paper highlights how inadequately the general unemployment scheme addresses the unique characteristics of self-employed and platform workers, emphasising that the scheme is not well designed for their needs. Furthermore, the infrequent and irregular income among self-employed and platform workers makes it more difficult for them to access adequate unemployment benefits under the current system.
Spain provides mandatory protection against unemployment in case of cessation of activity for the self-employed and economically dependent workers (TRADE) (Salas Porras, 2024). Cessation of activity is understood as a loss of professional activity due to reasons beyond their control; it must amount to a total stopping of economic or professional activity and may be permanent or temporary. A series of situations are considered to be valid reasons for cessation of activity, such as cases of force majeure, loss of administrative licence, retirement or disability of the client, etc. The scheme, which is tailored to the characteristics of these workers, has specific requirements. María Salas Porras identifies significant differences in the unemployment protection provided to employees, such as higher benefits, greater flexibility to enable partial protection and the possibility for employees to be assimilated to affiliated workers. Platform workers are covered on the basis of their work status – either as employees, self-employed or economically dependent workers (TRADE). Again, we see a problem arising for platform workers on a low income, as such workers will not fulfil the income thresholds of the scheme for employees and self-employed and economically dependent workers. The exception are platform workers combining multiple jobs, as it is more likely that they will meet the income threshold.
In Switzerland, Sabrine Magoga-Sabatier (2024) notes that there is no compulsory or voluntary unemployment insurance for the self-employed. They do, however, have access to unemployment protection for employees in the event of business failure, provided that they have previously paid contributions as an employee. However, the conditions for accessing such protection are strict, as self-employed persons must stop their activity and sever all links to it. Platform workers are often excluded from unemployment protection due to the irregular nature of their work and the restrictions on income fluctuations imposed by unemployment legislation. Magoga-Sabatier argues that the struggles of the Swiss social security system to include self-employed persons and platform workers can be explained by its federal direct democracy, which cannot adapt to the fast-moving changes of the world of work, increasing the risks of precariousness and the burden on the cantons’ social assistance for the next generation. Thus, Switzerland's specific democratic character influences its ability to address the needs of self-employed persons and platform workers.
Unemployment protection in a comparative perspective
The subsequent contributions, in a second part of this special issue, analyse the protection provided to the self-employed and platform workers from a comparative perspective.
In their contribution, Paul Schoukens and Enzo Weber (2024) focus on common guidelines for national legislators and policy makers on how unemployment protection schemes for the self-employed could be organised. These guidelines have been derived from the national descriptions presented in this special issue on unemployment protection for the self-employed, or in other recent comparative contributions on the subject. The reference framework they use in their paper is the 2019 Recommendation and, in particular, the overall objective that social protection should be designed in a way that is neutral with regard to work status and, where necessary, adapted to the specific work situation of the professional groups covered. They argue that in the case of unemployment schemes for the self-employed, the design of the scheme should be as similar as possible to the unemployment insurance for wage earners. However, attention should also be paid to the necessary differences with the scheme for employees: adaptations should be introduced, taking into account the nature of self-employed work, such as the fact that the self-employed do not work for an employer. In their paper, they address the definitions of unemployment risk, financing, access and eligibility conditions, and re-eligibility in case of repeated claims for unemployment benefits. They also address other elements related to recent developments in the labour market and elaborate on situations of temporary cessation of activity and partial unemployment.
In his contribution, Alberto Barrio (2024) also conducts a comparative analysis based on the different country discussions in Part 1. His contribution addresses the challenges faced in ensuring that platform workers, regardless of their labour status, can effectively access unemployment insurance protection. Barrio identifies several problems of formal access (due to classification as self-employed or marginal work) and effective access (due to the difficulties meeting minimum work requirements, the fragmented character of the work provided, and the lack of transparent information on algorithmic management and platform work). He identifies several approaches taken by EU countries to address such challenges, such as employment status reclassification and the establishment of a presumption of an employment relationship, and the exemption from formal social security coverage of some forms of (marginal) platform work. General approaches with consequences for the unemployment insurance protection of platform workers include applying the same criteria for access to unemployment benefits across employment statuses, as well as greater leniency on these criteria for certain forms of non-standard work. He concludes that the challenges brought by platform work share many similarities with those linked to other forms of non-standard work. However, they are expanded and multiplied for platform workers: low-income platform workers in particular find themselves in a precarious position.
The aim of both papers is to provide a framework for organising unemployment insurance for self-employed persons and platform workers, drawing from the country discussions. These two contributions explore in detail how social security systems need to be adapted to the specific work situation of the self-employed and platform workers, and can inspire EU and national policies.
The role of the EU in shaping unemployment protection
The third and last part of the special issue will address the role of the EU in unemployment protection for atypical workers and the self-employed. Two papers focus on the role of the EU in harmonising and coordinating unemployment schemes.
In the paper by Eleni De Becker (2024a), the author critically analyses the steps taken by the EU to strengthen the social protection of atypical workers and self-employed persons. Although no legally binding steps have been taken by the EU to date, the EPSR and the 2019 Recommendation have drawn more attention to the protection of atypical workers and the self-employed. As part of the EU's recovery strategy during and after the Covid-19 crisis, several financial instruments were also developed to support EU Member States, notably the Recovery and Resilience Facility and SURE. The European Social Fund Plus also plays an important role in providing funding to EU Member States for social policy actions. This paper discusses the recent EU initiatives focusing on the unemployment protection of atypical workers and the self-employed.
The last contribution, by Luka Mišič and Grega Strban (2024), discusses atypical work and residency in a cross-border context. Their article analyses the potential challenges related to the coordination of unemployment benefits under EU law for persons whose employment or other economic activities and living arrangements are in some way dispersed between the territories of several EU Member States. New forms of work and work organisation, alongside new mobility and residency patterns, challenge the basic principles of EU social security coordination. At the same time, the authors point out that unemployment benefits, at the heart of this debate, still remain subject to specific coordination rules that depart from the general principles, possibly making their effective application in such cases even more difficult.
Concluding remarks
The aim of this special issue is to examine unemployment protection for two atypical forms of work, namely the self-employed and platform workers. The idea of the issue was to develop and strengthen the academic debate by creating a common understanding of and language for the problems that countries might face when trying to include atypical forms of work in their social security systems – and to identify potential ways forward. In order to achieve this aim, the special issue is divided into three closely interrelated parts: (a) national perspectives providing detailed country-specific analyses; (b) comparative studies drawing cross-country lessons; and (c) EU-level discussions.
The cross-country comparison in Part 1 shows the diversity of approaches to unemployment protection for the self-employed and platform workers. While (mandatory) unemployment protection for the self-employed and platform workers has been extended in recent years, the country comparisons demonstrate the diversity of formal and effective access across the EU Member States. Other recurring problems include access to protection when people combine different activities under different labour statuses, the application of the same or similar requirements to the self-employed (e.g. the need to stop working, labour-brokering activities, willingness to accept suitable work, etc.). Various protection options can be found in the EU Member States – for example, (voluntary) access to the general unemployment scheme, specific schemes for the self-employed, or no protection for (certain) types of self-employed. There are no specific unemployment schemes for platform workers; the protection offered depends on their employment status. However, regardless of their employment status, platform workers engaged in marginal activities face significant barriers to accessing unemployment protection. Regarding this group, there is an even greater need for rules that take into account work performed under different employment statuses, as otherwise platform workers may combine a long list of parallel activities without having (adequate) access to social protection.
The country discussions in Part 1 of this special issue have enabled Paul Schoukens, Enzo Weber (2024) and Alberto Barrio (2024) to develop solutions for extending protection to self-employed and platform workers in EU Member States. They highlight different challenges, opportunities and concepts for policy makers, which can provide inspiration for the redesign of social protection systems. The final part does the same for the EU. EU action in the field of social security has traditionally focused on the coordination of social security systems to ensure the free movement of people: the need to review and redesign this coordination mechanism has been on the EU legislator's table since 2016. The coordination of unemployment benefits is one of the areas where it was felt that change was urgently needed. To date, however, no agreement has been reached. In their analysis, Mišič and Strban (2024) show how a changing labour market poses additional challenges that should not be overlooked by the EU legislator. De Becker's contribution (2024) makes it clear that, separately from the coordination mechanism at EU-level, the EU has, in recent years, taken several steps to harmonise social security systems. Through initiatives such as the European Pillar of Social Rights and the 2019 Recommendation, the EU has played a key role in promoting social protection for atypical workers. While these steps are not binding, they raised awareness of the need for inclusive social protection systems. In addition, EU financial instruments such as the Recovery and Resilience Facility and SURE have provided important support to EU Member States, enabling them to strengthen their social protection systems in response to crises. Given this progress, an important goal at European level should be to improve the transparency and democratic legitimacy of these funding mechanisms, and indeed of the European Semester in general.
Footnotes
Declaration of conflicting interests
The authors declared no potential conflicts of interest with respect to the research, authorship and/or publication of this article.
Funding
The authors received no financial support for the research, authorship and/or publication of this article.
