algoritmos

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In today’s world, a host of businesses rely on artificial intelligence and algorithms to make such everyday decisions as hiring staff, assigning tasks, distributing time and workplaces, appraisals and promotions or checking whether goals have been met for bonus accrual.  Those businesses will now be affected by a recently announced reform.

On May 12, the Official Gazette of the Spanish State published Royal Decree Law 9/2021, of May 11, amending the Consolidated Workers Statute Act (Ley del Estatuto de los Trabajadores), to ensure the employment rights of delivery workers working through digital platforms, including the newly dubbed “employee status” of delivery drivers and riders working through digital platforms.  

Firstly, the regulation includes an Additional Provision 23 in the Workers Statute, which assumes an employment relationship, under section 8(1) of the Workers Statute, for any “persons who provide remunerated services consisting of the delivery or distribution of any consumer product or good on behalf of employers who carry out organization, management and business oversight activities, directly, indirectly or implicitly, through algorithm management of the service or working conditions, through a digital platform”.

The reform, which will enter into force three months after its publication in the Gazette (August 12), does not just introduce a rebuttable presumption that there is an employment relationship for this group of workers, but recognizes, for the first time in Spanish employment law, the concept of algorithms as workforce managers.  It classes as employment a provision of services irrespective of whether the management comes directly from the business through physical managers or through algorithms.

But from our perspective, the most important news for business is actually the inclusion of a new paragraph d) of section 64(4) of the Workers Statute, which grants the workforce’s legal representatives the right to be informed by the businessof the parameters, rules and instructions that serve as the basis of algorithms or artificial intelligence systems that affect decision making, which could have an impact on working conditions, access to and continued employment, including profiling”. 

Although this is all new for the employment world, it is not the first time that Spanish law has seen an express regulation for automated decisions and artificial intelligence systems.  Article 22 of the General Data Protection Regulation, which has been in force since May 2018, includes a provision that applies to any kind of relationship—including an employment one—prohibiting an individual from being subject to a decision solely based on automated processing of their personal data, except where necessary to execute a contract, where there has been an express legal authorization, or where based on the express consent of the data subject. 

This kind of provision is starting to be reflected in collective bargaining.  For instance, section 80(5) of the XXIV Banking Sector Collective Bargaining Agreement, entitled “Rights against artificial intelligence” introduces a similar provision to that included in the labor provision, and it will certainly not be the last. 

The importance and impact that this reform will have are wide reaching, as potentially, it could affect any business, not just those in tech or the gig economy. It could also be extended further in the coming years, given the trend to increasingly use these algorithms to manage people, due to the advantages and objectivity they offer. 

There have been major interpretation concerns, even pre-dating the publication in the Official Gazette, about businesses’ new reporting duty to the workforce’s legal representatives.

For example: What kind of algorithms or artificial intelligence systems are covered? What does it mean by “an impact on working conditions, access to and continued employment”?How, when and whom must be informed? And what if the workforce has no unitary representation? When the regulation refers to reporting the “parameters, rules and instructions” of the algorithms, how much detail is required?  What if the artificial intelligence system has not been developed in house, but by an external provider?

On the one hand, this information could be considered secret company know how, as defined in section 1 of Spanish Act 1/2019, on Business Secrets. Although that legislation considers the obtainment of business secrets to be lawful when in the context of the legitimate exercise of the legal representation of workers, it anticipates that, logically, businesses will be reluctant to lay bare their systems. It will be interesting to analyze the liability to which legal representatives will be exposed in the event of a breach of their professional secrecy duty for information that could be highly valuable, and what contractual liability a business could face from its artificial intelligence services supplier following the disclosure of key data about its algorithm. 

On the other hand, the right to information may always be exercised if algorithms or artificial intelligence systems “affect decision making that could have an impact on working conditions”. If interpreted literally, this provision could lead to an infinite number of scenarios, since the regulation would not require the decision to be directly imposed by the algorithm, just that the algorithm had a bearing on decision making (even where taken by a human). 

The new development brought in by the amendment to section 64 of the Workers Statute is part of a clear legislative trend, coming from various bodies, to regulate artificial intelligence systems, particularly when they directly or indirectly interact with people.  As well as the above regulations, an example of this can be seen in the recent proposal by the European Commission for harmonized rules on artificial intelligence, which, in recital 36, qualifies the use of artificial intelligence systems at work as ”high-risk, since those systems may appreciably impact the future career prospects and livelihoods of these persons.”  Essentially, both the Government and labor stakeholders have been forced to get up to speed on the impact of disruptive technologies at work.  The reform intends to make legislation consider the impact on labor relations (individual and collective), while the scope for business is yet to be seen.

This post is also available in: Español

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josemaria.martinez@cuatrecasas.com

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Jorge Monclús

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