Ride-hailing and food delivery platforms are often sold to the public as symbols of flexibility and free markets. Drivers and riders are called independent partners, free to log in and out at will. Platforms insist they are merely “intermediaries”, not employers.
But in practice, these platforms extract a significant share of workers’ income while systematically denying employment status. They behave like employers such as setting prices, controlling access to work and even imposing performance targets, yet avoid the legal responsibilities that normally come with that power.
This contradiction becomes especially clear when we compare Malaysia and Germany.
Platforms as De Facto Employers
In ride-hailing and food delivery systems, income is not negotiated by workers. Prices, commissions, incentives, penalties and even visibility on the app are all set by the platform.
Workers cannot meaningfully bargain.
They cannot set fares.
They cannot choose customers.
They can be “deactivated” unilaterally.
Although platform work is presented as a free market, commission-based ride-hailing and delivery systems function more like monopsonistic labour markets, markets with many workers but very few buyers of labour. Platforms control prices, extract rents and even shift business risks onto workers, while insulating themselves from labour law obligations.
Malaysia: Flexibility Without Protection
In Malaysia, gig workers are generally classified as independent contractors. This classification has profound consequences:
• No minimum wage protection
• No paid leave
• No employer contributions to social security
• No obligation to provide work equipment
• No protection against unfair termination or deactivation
Even when platforms take a large percentage of each ride or delivery, the legal system largely treats this as a private commercial arrangement rather than an employment relationship.
As a result, workers bear:
• Vehicle and maintenance costs
• Fuel and insurance costs
• Health and accident risks
• Income instability caused by algorithm changes
The platform enjoys flexibility. The worker absorbs uncertainty.
Germany: Courts Question the Legal Fiction
Germany has taken a very different path. Courts have increasingly questioned whether gig workers are truly independent when platforms tightly control how work is performed.
Employee Status Through Control
In a landmark 2020 ruling (9 AZR 102/20), the German Federal Labour Court held that platform workers, including crowdworkers, can be classified as employees if the platform’s structure, instructions and performance-based incentives create a relationship of personal dependence.
The court made it clear:
labels do not matter, but reality does.
If a platform:
• Organises work through an app
• Controls task allocation
• Uses ratings, bonuses and penalties to enforce compliance
then the worker may fall under labour law protection, regardless of contractual wording.
Equipment Must Be Provided
This approach was reinforced in a 2021 ruling by the German Federal Labour Court in Erfurt, which held that Lieferando must provide bicycle couriers with necessary work equipment or pay adequate compensation.
In other words, if a company benefits from the labour, it must also bear part of the cost of enabling that labour.
Two Systems, Two Philosophies
The contrast between Malaysia and Germany is not just legal, it is philosophical.
| Malaysia | Germany |
| Focus on contractual labels | Focus on economic reality |
| Flexibility prioritised | Protection balanced with flexibility |
| Workers absorb most risks | Risks shared with platforms |
| Courts defer to platform structure | Courts scrutinise platform control |
Germany does not ban gig work. It simply refuses to accept a legal fiction where companies enjoy employer-like control without employer-like responsibility.
The Bigger Question
As courts around the world increasingly challenge the classification of gig workers as independent contractors, one question becomes unavoidable:
If a platform controls prices, performance, access to work and discipline, our question now is, can it still claim not to be an employer?
Malaysia has not yet fully confronted this question. Germany already has.
And as platform labour continues to expand, the gap between these two approaches will only become more visible and more contested.
Keywords: gig economy, ride-hailing platforms, food delivery workers, gig workers employment status, Malaysia gig economy, Germany labour law, platform workers rights, monopsony labour market, independent contractors vs employees, German Federal Labour Court, Lieferando case, crowdworkers Germany
11 February 2026