Opinion on the legal basis of the recommendations to the Commission on digitalisation, artificial intelligence and algorithmic management in the workplace – shaping the future of work

3.12.2025

Mrs Li Andersson

Chair

Committee on Employment and Social Affairs

BRUSSELS

Subject: Opinion on the legal basis of the recommendations to the Commission on digitalisation, artificial intelligence and algorithmic management in the workplace – shaping the future of work (2025/2080(INL))

Dear Madam Chair,

I - Introduction

On 17 January 2025, the Committee on Employment and Social Affairs (EMPL) requested an authorisation to draw up an own-initiative legislative report (INL) pursuant to Article 225 of the Treaty on the Functioning of the European Union (TFEU) and Rule 47 of the Rules of Procedure of the European Parliament (RoP), with recommendations to the Commission on digitalisation, artificial intelligence and algorithmic management in the workplace - shaping the future of work. The authorisation was granted by the Conference of Presidents on 3 April 2025.

In accordance with Rule 47(3) RoP, the committee responsible for the subject-matter is to request an opinion on the appropriateness of the legal basis from the committee responsible for legal affairs, which is to be delivered without undue delay. Such request was sent on 27 June 2025 by the Chair of the EMPL committee.

The Committee on Legal Affairs considered the matter of the appropriateness of the legal basis proposed in the draft INL in question at its meeting on 3 December 2025.

II - Background

The request for authorisation of the INL was made pursuant to point VIII of Annex VI to the Rules of Procedure, which confers on the EMPL committee the competence in the area of employment policy and all aspects of social policy including working conditions, social security, social inclusion and social protection.

The purpose of the INL is to invite the Commission to propose legislative measures on the digitalisation of work, with particular attention to the use of artificial intelligence (AI) and algorithmic management systems in the workplace.

The initiative seeks to ensure that these technologies are deployed in ways that respect workers’ rights while also fostering productivity and innovation. It aims to establish an EU-wide regulatory framework that strikes a fair balance between the benefits of digital transformation and the risks and challenges posed by AI and algorithmic management in the world of work.

In the INL, the EMPL committee intended to analyse the challenges that digital technologies, especially AI and algorithmic management, pose in the workplace. This includes addressing issues related to workplace surveillance, performance pressure, and discrimination risks. The proposal aims to ensure that any such systems are deployed transparently, with adequate safeguards and workers’ rights protected under EU law.

The EMPL committee also intended to explore the following aspects in the INL: (i) the impact of AI and algorithmic systems on workers' rights, including data protection and the right to information and consultation; (ii) the regulatory gap in existing EU legislation, such as the AI Act, which focuses on market aspects but does not sufficiently cover the worker-employer relationship; (iii) safeguards to mitigate potential risks such as algorithmic bias, excessive work intensification, and mental health issues related to constant monitoring; (iv) the role of social dialogue and worker consultation in ensuring that these technologies are implemented in a way that is fair and transparent.

The EMPL committee also intended to address the potential training needs for workers and the importance of providing clear and accessible information about the use of these technologies, especially when they influence key aspects of employment, such as hiring, pay changes, and performance evaluations.

The INL is primarily based on Article 153(2), point (b), in conjunction with Article 153(1), point (b), TFEU, which cover issues related to working conditions, and Article 16(2) TFEU on personal data protection.

III - The relevant Treaty Articles

Title X of Part three TFEU, on “Social policy”, reads, inter alia (emphasis added):

Article 153

(ex Article 137 TEC)

1. With a view to achieving the objectives of Article 151, the Union shall support and complement the activities of the Member States in the following fields:(a) improvement in particular of the working environment to protect workers’ health and safety;

(a) improvement in particular of the working environment to protect workers' health and safety;

(b) working conditions;

(c) social security and social protection of workers;

(d) protection of workers where their employment contract is terminated;

(e) the information and consultation of workers;

(f) representation and collective defence of the interests of workers and employers, including co-determination, subject to paragraph 5;

(g) conditions of employment for third-country nationals legally residing in Union territory;

(h) the integration of persons excluded from the labour market, without prejudice to Article 166;

(i) equality between men and women with regard to labour market opportunities and treatment at work;

(j) the combating of social exclusion;

(k) the modernisation of social protection systems without prejudice to point (c).

2. To this end, the European Parliament and the Council:

(a) may adopt measures designed to encourage cooperation between Member States through initiatives aimed at improving knowledge, developing exchanges of information and best practices, promoting innovative approaches and evaluating experiences, excluding any harmonisation of the laws and regulations of the Member States;

(b) may adopt, in the fields referred to in paragraph 1(a) to (i), by means of directives, minimum requirements for gradual implementation, having regard to the conditions and technical rules obtaining in each of the Member States. Such directives shall avoid imposing administrative, financial and legal constraints in a way which would hold back the creation and development of small and medium-sized undertakings.

The European Parliament and the Council shall act in accordance with the ordinary legislative procedure after consulting the Economic and Social Committee and the Committee of the Regions.

In the fields referred to in paragraph 1(c), (d), (f) and (g), the Council shall act unanimously, in accordance with a special legislative procedure, after consulting the European Parliament and the said Committees.

The Council, acting unanimously on a proposal from the Commission, after consulting the European Parliament, may decide to render the ordinary legislative procedure applicable to paragraph 1(d), (f) and (g).

3. A Member State may entrust management and labour, at their joint request, with the implementation of directives adopted pursuant to paragraph 2, or, where appropriate, with the implementation of a Council decision adopted in accordance with Article 155.

In this case, it shall ensure that, no later than the date on which a directive or a decision must be transposed or implemented, management and labour have introduced the necessary measures by agreement, the Member State concerned being required to take any necessary measure enabling it at any time to be in a position to guarantee the results imposed by that directive or that decision.

4. The provisions adopted pursuant to this Article:

- shall not affect the right of Member States to define the fundamental principles of their social security systems and must not significantly affect the financial equilibrium thereof,

- shall not prevent any Member State from maintaining or introducing more stringent protective measures compatible with the Treaties.

5. The provisions of this Article shall not apply to pay, the right of association, the right to strike or the right to impose lock-outs.

Title II of Part one TFEU, on “Provisions having general application”, reads, inter alia:

Article 16

(ex Article 286 TEC)

1. Everyone has the right to the protection of personal data concerning them.

2. The European Parliament and the Council, acting in accordance with the ordinary legislative procedure, shall lay down the rules relating to the protection of individuals with regard to the processing of personal data by Union institutions, bodies, offices and agencies, and by the Member States when carrying out activities which fall within the scope of Union law, and the rules relating to the free movement of such data. Compliance with these rules shall be subject to the control of independent authorities.

The rules adopted on the basis of this Article shall be without prejudice to the specific rules laid down in Article 39 of the Treaty on European Union.

IV – CJEU case-law on the choice of legal basis

The Court of Justice of the European Union (CJEU) has traditionally viewed the question of the appropriate legal basis as an issue of constitutional significance, guaranteeing compliance with the principle of conferred powers (Article 5 of the Treaty on European Union) and determining the nature and scope of the Union’s competence.

According to well-established case-law, the legal basis of a Union act does not depend on an institution's conviction as to the objective pursued but must be determined according to objective criteria amenable to judicial review, including in particular the aim and the content of the measure.

If examination of a measure reveals that it pursues a twofold purpose or that it has a twofold component and if one of those is identifiable as the main or predominant purpose or component, whereas the other is merely incidental, that measure must be based on a single legal basis, namely that required by the main or predominant purpose or component. Only exceptionally, if it is established that the act simultaneously pursues a number of objectives, inextricably linked, without one being secondary and indirect in relation to the other, may such an act be founded on the various corresponding legal bases. This would however only be possible if the procedures laid down for the respective legal bases are not incompatible with and do not undermine the right of the European Parliament.

V – Aim and content of the INL

The aim as specified in recommendation 1 in the Annex to the final report by the EMPL committee is to “improve working conditions and to promote the transparent, fair, accountable and safe deployment and use of automated monitoring and decision-making systems used to take or to support decisions at the workplace, ensuring human oversight, the protection of workers’ fundamental rights, and the protection of workers in relation to the processing of their personal data”. Therefore, at the very beginning of the Annex with the recommendations to the Commission, the INL states the twofold objective: improving working conditions and protecting personal data of workers.

That interpretation is strengthened by paragraphs 2 and 3 of the resolution in the final report of the EMPL committee, preceding the Annex with the recommendations to the Commission, in which concerns relating to “growing use of AI and algorithmic management” are expressed, as they pose “significant challenges (...) for workers, particularly in terms [of] working and employment conditions” (paragraph 2) and in which it is stressed that “companies should be encouraged to integrate such technologies in a responsible, transparent and inclusive manner, with respect to worker’s privacy and data protection” (paragraph 3).

It can, therefore, be argued that the INL pursues the twofold objective revolving around (a) the social protection of workers with regard to the improvement of working conditions, as well as (b) the promotion of transparent, fair, accountable and safe deployment and use of automated monitoring and decision-making systems in the workplace, with an explicit reference to fundamental rights and the protection of workers with regard to the processing of their personal data.

With regard to the content of the INL, the Annex comprises 11 recommendations. Recommendations 1 and 2 specify the INL proposal’s subject matter and scope, and provide definitions of key concepts. Recommendations 3 to 7 set out the main substantive pillars of the INL, which concern the following aspects (i) transparency and right to information for directly affected workers and their representatives concerning the use or planned use of systems for algorithmic management in the workplace (recommendation 3); (ii) consultation regarding the deployment and use of new systems of algorithmic management, or such updates to existing systems which directly affect workers’ remuneration, evaluation, working arrangements, task allocation or working time (recommendation 4); (iii) prohibited practices for the collection, storage, monitoring, sale, or any other processing activity regarding certain categories of personal data (recommendation 5); (iv) human oversight and review of decisions taken or supported by algorithmic management systems (recommendation 6); (v) occupational health and safety, with regard to the evaluation of the risks posed by algorithmic management systems in terms of work-related accidents, psychosocial and ergonomic risks as well as undue pressure put on workers (recommendation 7). Lastly, recommendations 8 to 11 concern the responsibilities of competent national authorities, enforcement and supervisory obligations, and the non-regression and more favourable provisions clause.

The personal scope of application recommended in the INL is narrowed down to “every worker and employer in the Union”, including workers who are in a contractual relationship with an intermediary. Solo self-employed persons and relevant procurers of services have been excluded from the ambit recommended in the INL.

VI – Analysis

(a) Article 153 TFEU

It is clear that a combined reading of Article 153(1) and (2)(b) TFEU empowers Parliament and the Council to set minimum requirements as far as workers are concerned. Moreover, Article 153(2)(b), in conjunction with paragraph 1 of the same Article, can be used only insofar as self-employed persons can be considered ‘workers’, that is in those cases of ‘false self-employment’ where the ‘self-employed’ status is nominal, according to the jurisprudence of the CJEU. The exclusion of genuine self-employed persons and relevant procurers of services from the ambit recommended in the INL ensures, in fact, the compatibility of the INL proposal’s personal scope with Article 153(2)(b), in conjunction with paragraph 1, point (b), of that Article.

This reasoning is also supported by the recently adopted Platform Work Directive, also based on Article 153(2), point (b), in conjunction with paragraph 1, point (b), of that Article (as well as on Article 16(2) TFEU). That Directive, in Article 5, creates an effective rebuttable legal presumption of an employment relationship for persons performing platform work, even if they are nominally self-employed.

As already mentioned above, recommendation 1 of the final INL report adopted by the EMPL committee clearly states that the aim of the proposal is to “improve working conditions and to promote the transparent, fair, accountable and safe deployment and use of automated monitoring and decision-making systems used to take or to support decisions at the workplace, ensuring human oversight, the protection of workers’ fundamental rights”. Therefore, Article 153(2), point (b), in conjunction with paragraph 1, point (b), of that Article seems the appropriate legal basis to achieve such goal.

(b) Article 16 TFEU

It is, furthermore, necessary to scrutinise the INL in order to ascertain whether the substantive components principally fall within the scope of improving working conditions, with only incidental effects on data protection, or they would, rather, inextricably concern both the improvement of working conditions and data protection.

Firstly, it is worth noting in relation to this scrutiny that the Platform Work Directive has been based on the same legal bases of Articles 153(2)(b), in conjunction with paragraph 1, point (b) of that Article, and on Article 16(2) TFEU. Article 16(2) TFEU has also been used for the adoption of the AI Act (alongside Article 114 TFEU) as far as specific rules on the protection of individuals with regard to the processing of personal data are concerned, with regard to restrictions of the use of AI systems for remote biometric identification for the purpose of law enforcement, of the use of AI systems for risk assessments of natural persons for the purpose of law enforcement, and of the use of AI systems of biometric categorisation for the purpose of law enforcement.

Incidentally, it should be remarked that recourse to Article 16(2) TFEU would allow for the adoption of rules as far as workers (and cases of false self-employment) are concerned but only to the extent where processing of personal data is concerned. This is precisely the case with the Platform Work Directive.

The final INL report adopted by the EMPL committee contains several data protection-related provisions, which, to a large extent, mirror the fundamental rationale and content of Chapter III of the Platform Work Directive regarding algorithmic management. Recommendation 3(c) of the INL, for example, reads “the categories of data collected and processed by such systems in relation to the workers, the purpose of the collection of the data and the details of the persons to whom the data is transferred” and “workers should be provided with tools for effective exercise of their data access rights and their portability rights”.

Furthermore, recommendation 5 contains a number of prohibited practices with regard to collection, storage, sale or any other processing of certain categories of data (for example: ‘emotional, psychological or neurological states’, ‘private communications’, ‘real-time geolocation tracking outside working hours’ ...), very similar to those provided under Article 7 of the Platform Work Directive.

Recommendation 6 call for human oversight at all times over all decisions taken or supported by algorithmic management systems and the right of workers to receive from their employers “meaningful and comprehensible oral or written explanation regarding any decision taken or substantially supported by algorithmic management that affects the essential aspects of their employment, including the allocation of tasks, the evaluation of performance, working time scheduling, remuneration, and disciplinary measures, where any decision relating to such matters has been taken or has been substantially influenced by an algorithmic system”.

Finally, recommendation 10 states that “the proposal should ensure that data protection authorities... also monitor the application of the proposed act in relation to data processing in employment contexts, in cooperation with national labour authorities and other competent authorities, such as equality bodies.”

The above recommendations make the INL very similar to the Platform Workers Directive with respect to data protection rules. Therefore, while the improvement of working conditions appears to be the predominant aim in the INL, the distinct references to data protection in various recommendations and the data protection-related reinforcement of the material scope content-wise, demonstrate that data protection can be perceived as both an objective and a component simultaneously served by the INL, alongside the improvement of working conditions, in a mutually reinforcing and inseparable manner.

(c) Other aspects

The final INL report contains, in recommendation 4, elements that, on the one hand, concern workers’ health and safety, which would fall under Article 153(1)(a) TFEU, and secure consultation for workers, on the other, which falls under Article 153(1)(e) TFEU. However, it is clear from the text that those are not the predominant aims and can therefore be considered incidental to pursuing the main aim of the proposal, which is to improve working conditions while protecting personal data of workers.

VII – Conclusion

At its meeting of 3 December 2025 the Committee on Legal Affairs accordingly decided unanimously (by 23 votes in favour), to recommend that the own-initiative legislative report of the Committee on Employment and Social Affairs pursues aims in the area of improving working conditions, as well as the protection of personal data and that they are indissociably linked and that, therefore, Article 153(2), point (b), TFEU in conjunction with paragraph 1, point (b), of that Article, and Article 16(2) TFEU seem to be the appropriate legal bases.

Yours sincerely,

Ilhan Kyuchyuk