Albert Hirschman Centre on Democracy
16 June 2021

Managing complexity in the platform economy: self-regulation and the cross-border social dialogue route

Commentary by Konstantinos Papadakis and Maria Mexi

The growth of the digital platform economy is one of the most important developments transforming the world of work. The very technology powering the platform economy has led to an increasing global division of labour via web-based labour platforms where work is outsourced by businesses and other clients through an open call to a geographically dispersed crowd (so-called “crowdwork”). On the positive side, platform-based crowdwork is enabling a global mobility of virtual labour, having the potential to help job seekers from low- and middle-income countries enter new labour markets, often in wealthier economies, that were previously out of reach due to migration barriers. It can thus offer income, skill utilization and enhancement, international exposure, assured payments for work undertaken and ''gainful employment opportunities for low-skilled developing country workers who are unemployed, underemployed or in the informal sector''. On the negative side, platform-enabled crowdwork means that firms can gain access to a global diverse pool of workers from which to recruit at low cost. As a result, some point to a race to the bottom on wages and workers' rights, related to geographical differences in skills and labour costs.

A fundamental question arising in this context is how can we address inequities fostered by platform crowdwork and create spaces for promoting democratic governance and participation of all actors in the crowdwork platform industry enabling them to work together to ensure level playing-field rules against social dumping, while reverting a possible degradation of basic labour standards? There is an undeniable difficulty: the global span of much work performed via crowdwork platforms means that it tends largely to be done outside of the purview of national labour standards and rules in either their employers' home countries or the platform worker’s home country. Hence, what is fundamentally different in the platform economy from pre-existing work patterns is the globally dispersed nature of crowdwork that raises certain questions about the exact boundary position of possible regulatory  – including governance – interventions. How would regulations apply to work that is performed in Switzerland, but delivered online via a digital platform registered in the US to a crowdsourcer client located in another country (or sometimes involving multiple platforms and clients in different countries)? And even if a specific regulatory model is designed to be relevant, how can it be enforced across borders?

Responding to this challenge we argue that inspiration can be taken from voluntary cross-border social dialogue (CBSD) initiatives and agreements such as the transnational company agreements (TCAs). Such agreements include international framework agreements (IFAs) between Global Union Federations (GUFs) and MNEs and European Framework Agreements (EFAs) between MNEs and European trade union federations and/or European Works Councils. TCAs aim to establish ongoing relationships between MNEs and GUFs, for the benefit of both parties. They are intended to promote principles of labour relations and conditions of work – notably in the area of freedom of association and collective bargaining – and to organize a common labour relations framework at cross border level. The emergence of this form of transnational private labour regulation via TCAs has proved a crucial in addressing ‘governance gaps’ in increasingly complex value chains that span across borders. Between 1988 and early 2020, some 325 TCAs were signed by over 200 enterprises, mostly European-based MNEs. The positive impact that TCAs may have on the improvement of, and compliance with, labour standards in global supply chains is evident in recent policy documents adopted by the International Labour Organization (ILO) (see ILO, ‘Decent Work in Global Supply Chains’ (n 4) 66; ILO, Resolution concerning decent work in global supply chains adopted on 10 June 2016 para 23(c); ILO, Meeting of experts on cross-border social dialogue, Final Conclusions, Geneva 12-15 February 2019 conclusion no 8). At the same time, the inherent adaptability and reflexivity of CBSD occurred at the global level through intergovernmental and multilateral processes – most notably through the ILO itself – presents a unique opportunity to ensure decent working conditions for all platform workers in the platform economy and to accommodate  “voice”, in Hirschmanian terminology, by  transforming relations between platform companies and platform workers through the spaces for democratic consultation to which they can give rise.

CBSD refers to the dialogue developed between or among governments, workers and employers or their representatives beyond national borders for the purpose of promoting decent work and sound industrial relations. Such dialogue may focus on the opportunities and challenges associated with a country, economic sector, enterprise, region or group of countries. It may take place within ad hoc or institutionalized fora, mechanisms involving two or more parties or as a result of public or private (self) regulatory initiatives developed in the context of a dynamic of economic integration and the organization of production along increasingly complex global supply chains (GSCs). The spaces for CBSD have multiplied over the past century in response to deepening globalization and regional integration. By promoting participatory governance and establishing consultation and information-sharing machinery, cross-border social dialogue has been found to facilitate knowledge-sharing and reflexivity that have in turn enabled: a) adjustment of social partners to critical transitions, and; b) implementation of core labour standards in contexts of globalization and economic crises – thereby: “helping improve the design of training systems and the retention of skills creating an enabling environment for sustainable enterprises and offsetting risks in supply chains”. Hence, CBSD has been growing and becoming consolidated in both public and private governance spaces.

Yet CBSD is not new. Since 1919, the practice of bringing representatives of governments, employers and workers together at the international level to seek consensus-driven solutions to socio-economic issues has become a key feature of the multilateral system, originating with the creation of the ILO. In the last five years, the ILO has firmly placed the question of cross-border social dialogue, on top of its policy agenda. In 2016, following a general discussion on decent work in GSCs in the International Labour Conference (ILC), the Organization was called upon to promote CBSD, such as by offering assistance, “upon joint request”, in the design and follow-up phase of IFAs, “including monitoring, mediation and dispute settlement where appropriate”. In the years that followed the 2016 ILC, the ILO’s mandate was further strengthened. Importantly, in early 2019 the ILO’s mandate in the area of CBSD was further consolidated on the occasion of a tripartite Meeting of Experts, which reviewed existing standards, practices developed at various levels and the instances that pave the way for cross-border social dialogue and agreements. The “Conclusions” reached by the experts, approved by the ILO Governing Body in November 2019, called upon ILO Member States to create an enabling environment for cross-border social dialogue by building the capacity of labour administrations and labour inspectorates in relation to CBSD; adopting national policies and regulations that are conducive to CBSD; and promoting effective linkages between different forms and levels of social dialogue and strengthen their complementarity.

In sum, due to their qualities and outcomes (enhancing reflexivity and managing labour processes and economic activities that are no longer territorially limited while promoting labour standards) tested in a global supply chain environment, both CBSD and TCAs can give rise to new opportunities for facilitating dialogue, and promoting coordination between digital labour platforms, clients and workers responding to the emergence of a global or ''planetary labour market''. Especially TCAs can provide important analogies for designing similar instruments that could fit the complexity characterizing cross-border platform-enabled crowdwork involving a net of (often) multiple entities, physical locations, and different regulatory domains where work is performed, mediated, and delivered. And as in the case of global supply chains, the “shadow of regulation” (i.e. the readiness of actors to engage in CBSD and (self-)regulation can be boosted when actors perceive a regulatory threat by an external authority), and “protest and mobilization” campaigns by global unions could compel all platform economy actors to join CBSD and to reach tangible commitments to labour standards. As argued elsewhere, CBSD could become a key response to calls for a more ambitious global social dialogue and regulation, more responsive to the needs of the changing nature of work in the 21st century.


Konstantinos Papadakis is a senior specialist in the Governance and Tripartism Department of the International Labour Organization (ILO).

Maria Mexi is a Research Fellow in the Albert Hirschman Centre on Democracy.


This article has been written for the Albert Hirschman Centre on Democracy’s series of commentaries on the need to redesign the platform economy on a more democratic and sustainable basis.

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