Domestic cleaning will not be protected by pretending the informal market does not exist

By Ivan Shyla, Co-founder of CleanWhale

AlgorithmWatch is right about one thing: domestic cleaners need more safety, more transparency and more protection against abuse. But the article starts from the wrong policy question.

The real question is not: how do we force domestic cleaning into the standard employment model? The real question is: how do we move as much domestic cleaning as possible out of cash-in-hand work and into a visible, insured, taxable and accountable market?

Domestic cleaning was not invented by platforms. It was not “uberized” by apps. AlgorithmWatch itself acknowledges that cleaners were “uberized long before Uber,” that the activity remains largely informal, and that full-time employment is the exception rather than the rule. It also notes that outsourcing cleaning to small specialised firms made secure, decently paid positions difficult for cleaners to obtain.

That baseline matters. Platforms do not enter a clean, perfectly regulated labour market and destroy it. They enter a market that has been fragmented, private, under-reported and difficult to enforce for generations.

The scale of this reality is not small. The European Labour Authority reported that the personal and household services sector in the EU included between 12.8 million and 18 million declared and undeclared workers in 2020, depending on the definition used. It estimated that undeclared work represented slightly above 50% of the sector on average and almost 70% in direct household employment. The same report notes that the most prevalent form of undeclared work in this sector is unregistered employment, especially where households directly employ workers.

That is the market we are talking about. Any regulation that ignores this baseline will not protect cleaners. It will simply push them back into private cash arrangements where there is no invoice, no digital record, no tax, no insurance, no dispute process and no way to identify abusive clients.

The Netherlands offers a warning. Helpling’s Dutch arm went bankrupt in 2023 after seven years of operating in the Netherlands. Later, the Dutch Supreme Court confirmed that the Court of Appeal was entitled to treat cleaners working through Helpling as temporary agency workers, with private households acting as hirers. A chapter in Governing the Digital Society describes the economic consequence: Helpling could not afford the additional wage costs, became insolvent, and platform experts warned that cleaners would likely return to the informal job market, potentially with lower payments and less protection. Gigpedia later put the outcome even more directly: after the ruling and the bankruptcy, cleaners “returned” to the informal circuit.

That is not a victory for workers. It is not a victory for taxpayers. It is not a victory for safety. It is a victory for the black market.

Policymakers must be honest about household demand. If a cleaning service that costs a household €25 per hour suddenly costs €45, €55 or €60 because every occasional booking is treated like a conventional employment relationship, many households will not pay. They will clean themselves, hire privately through WhatsApp or Facebook groups, or pay someone in cash. This is not ideology. It is basic market behaviour.

The OECD has made the same point in more formal language. Its report on household services says that high prices, a substantial tax burden and lack of easy access are barriers to formalisation. It also explains that informal workers lack access to social protection arrangements in areas such as health, unemployment and pensions. The OECD also notes that vouchers and tax credits can reduce informality, but that effectiveness depends heavily on whether the policy actually reduces the final price for households.

So let us be clear: if governments want every domestic-cleaning hour to come with full employment rights, they have two honest options. They can subsidise the sector heavily enough that households still buy services formally, as some voucher and tax-credit systems try to do. Or they can accept that the formal market will shrink and informal work will expand. What is not honest is promising full employment protection at informal-market prices.

Employment contracts do not magically solve operational problems

The article also treats ordinary operational problems as if they prove that platforms are inherently harmful: inaccurate time estimates, waiting time, client cancellations, ratings and disputes about the scope of work. These are real problems. AlgorithmWatch specifically describes conflicts caused by clients entering the wrong size of premises, cleaners needing to stay longer, ratings, lack of leverage, and support staff allegedly encouraging cleaners to wait for absent clients without compensation.

But these problems do not disappear when the cleaner has an employment contract with a traditional cleaning company.

A household client who books a cleaner through a company can still understate the size of the apartment. The client can still be late. The client can still demand extra tasks. The client can still complain unfairly. The client can still cancel at the last moment. The work is still performed inside a private home, under conditions that are difficult to supervise in real time.

The difference is that, in a traditional employment model, the client often pays far above the informal market price. In some markets, the formal price can be two or three times the cash alternative. That does not automatically give the cleaner more power. Very often, it gives the paying client more power. A cleaning company that depends on expensive household clients has a strong commercial incentive to keep those clients happy — even when the cleaner is the weaker party in the conflict.

So the question is not whether a platform or an employment contract can magically remove waiting time, cancellations or unfair client behaviour. Neither can. The question is which model creates a better record, a better dispute process and a better incentive to formalise the transaction.

In a cash arrangement, there is usually no record at all. In a traditional small cleaning company, the cleaner may have a formal contract, but that does not mean all income is fully declared or that all working time is fairly recognised. The European Commission explicitly describes undeclared work as paid activity that is legal in nature but not reported to public authorities, and says it often occurs in services to private households. It also explains that work can be fully or partially undeclared, including through “envelope wages” or cash-in-hand payments on top of a small declared wage. Eurofound similarly describes partially undeclared work as underdeclared work, envelope wages or cash-in-hand.

This is important because “employment” and “formalisation” are not the same thing. A payroll contract can still coexist with informal top-ups, unpaid waiting time, pressure from clients and weak enforcement. A small cleaning company with ten cleaners on minimum-wage contracts is not automatically a safer, cleaner or more transparent system than a digital platform with verified clients, digital payments, tax records, insurance, cancellation rules and dispute evidence.

Of course, platforms can abuse their position too. Ratings can be unfair. Algorithms can be opaque. Cancellation policies can be badly designed. But the solution is not to pretend that traditional employment removes these problems. The solution is to make the transaction visible and enforceable.

A digital platform can record when the cleaner arrived, when the client opened the door, what was booked, what was added, what was cancelled, what was paid and what complaint was made. It can charge no-show fees, block abusive clients, preserve evidence, provide insurance and automate tax reporting. A cash client will not do that. A small local company often cannot do that at scale.

The policy debate should therefore stop confusing “contract type” with “real protection.” A formal employment contract is useful only if the market can actually sustain it and if the cleaner’s real income, real time and real risks are protected. Otherwise, it becomes a legal fiction: the client pays far above the market price, the company fights to retain the client, the cleaner remains exposed, and part of the sector still moves through cash, envelope wages or undeclared work.

That is not progress. Real progress is moving domestic cleaning from invisible private arrangements into visible, taxable, insured and digitally documented transactions.

The same applies to safety and harassment. Harassment in private homes is real. But an informal cash arrangement gives a cleaner almost no protection: no verified client identity, no booking history, no written complaint channel, no platform ban, no insurance record and no evidence trail. A regulated platform can provide identity checks, digital messaging, payment trails, dispute resolution, client exclusion, insurance and evidence for enforcement. The answer is to require platforms to do these things properly, not to eliminate the formal channel and send people back to cash work.

The EU Platform Work Directive may help where a platform genuinely controls and directs workers. But it must be applied with precision. The Council of the EU describes the directive as creating a rebuttable legal presumption of employment when facts indicating control and direction are found under national law, collective agreements or practice. Domestic cleaning is not the same as ride-hailing or food delivery. In many domestic-cleaning marketplaces, the cleaner chooses availability, location, clients and often price; the client gives instructions because the work is performed in the client’s home. Some platforms may cross the line into employer-like control. Those cases should be regulated. But treating every form of digital intermediation as employment is a blunt instrument that will reduce formal work rather than improve it.

Europe also needs to face the migration and tax reality. Many legally present migrants want to work, invoice, pay tax and build a record. But the simplest routes are often difficult to access. Poland is a practical example: migrant information resources explain that every foreigner can run certain company forms, such as limited liability companies, but access to sole-proprietorship-style activity on the same terms as Polish citizens depends on specific categories, such as EU or EEA citizenship, U.S. or Swiss citizenship, legal Ukrainian residence with a PESEL number, or particular residence permits. A cleaner who wants to work 8 or 12 hours a week is not going to create a complex company structure just to become visible to the tax system.

The United States is not perfect, and immigration status still matters. But one useful tax principle is straightforward: the IRS says that a nonresident alien engaged or considered to be engaged in a U.S. trade or business must file a return, and that effectively connected income, after allowable deductions, is taxed at graduated rates that are the same rates applied to U.S. citizens and residents. Europe should learn from that principle. Make legal small-scale entrepreneurship easy, fast and cheap. Give people a simple tax number, a simple invoice, a simple contribution rate and portable basic protection. Do not make the formal route so complicated that informal work becomes the rational choice.

Stop fighting digitalisation

Europe should stop fighting digitalisation in household services. A parliament cannot digitise the cleaning market by decree. It can write rules, but it cannot build the infrastructure that makes this market safer, more transparent and more formal.

That infrastructure will be built by platforms, not by thousands of micro-companies with ten cleaners on payroll and no technology, no scale, no automated tax reporting, no real-time booking systems, no client verification, no insurance integration, no rating governance and no meaningful data.

A serious platform has a business reason to improve the market. At scale, safety is not charity; it is part of the product. Verified clients reduce risk. Digital payments reduce tax evasion. Clear cancellation rules reduce conflict. Insurance reduces exposure. Automated receipts make taxation possible. Better matching increases income. Review systems, if properly designed, create accountability. Complaint channels, identity checks and digital records give cleaners tools that cash work will never provide.

This is the core misunderstanding in much of the platform-work debate. Profit is not automatically the enemy of protection. In a fragmented informal market, profit can be the reason why someone finally invests in protection. A platform that wants to grow has an incentive to make the experience safer, more predictable and more trusted for both sides of the transaction. The black market has no such incentive.

Small traditional cleaning firms are not a magic solution. Many of them operate with thin margins, limited technology and local reach. They may employ a small number of cleaners, but they do not solve the structural problem of the household-services sector: millions of private homes, irregular demand, part-time availability, migrant workers, tax complexity and customers who often compare formal prices with cash prices.

There are direct-employment cleaning platforms in some countries. BOOK A TIGER says that all of its cleaners are directly employed, insured through social security and entitled to paid holidays and sickness benefit. Batmaid Switzerland says that it employs and insures all cleaners and offers permanent contracts under the sector’s collective bargaining agreement. Such models may work in certain niches. But their existence does not answer the central policy question: who has shown that a strict direct-employment model can absorb the mass domestic-cleaning market across Europe while keeping prices acceptable for households and income attractive for cleaners, without heavy subsidies or market shrinkage?

The Dutch Helpling case shows the danger of confusing a legal victory with a social victory. When the formal platform disappears, the work does not disappear. It often moves back into the informal economy.

If Europe wants innovation, tax revenue and worker safety, it should not push household services back into the twentieth century. It should create a modern framework for flexible, declared, digitally mediated work.

That means simple tax registration. Low proportional contributions. Portable insurance. Mandatory digital payments. Transparent platform rules. Fast dispute resolution. Rating appeals. Client accountability. Special access routes for legally present migrants who want to work and pay taxes from day one.

Taxes are not just a source of public revenue. In this market, taxes are infrastructure. A declared transaction creates a record. A record enables insurance. Insurance enables safety. Safety enables trust. Trust enables market growth. And market growth creates the scale that allows platforms to invest in better tools, better compliance and better protection.

The alternative is not a beautiful world of stable jobs, strong unions and perfectly protected cleaners. The alternative is the same private cash market that has existed for decades: invisible, fragmented, untaxed and unsafe.

So the policy choice is simple. Europe can help platforms formalise household services, or it can regulate the formal channel out of existence and pretend that the informal market is a success story. It is not.

Let business improve the parts of the world that government has failed to organise. Regulate platforms, yes. Demand transparency, yes. Require insurance, yes. Protect workers from abuse, absolutely. But do not destroy the only actors with the scale, technology and incentive to make this market visible.

At CleanWhale, we believe the right policy is formalisation-first regulation:

• a simple micro-entrepreneur regime for occasional and part-time household services
• low proportional tax and social contributions instead of heavy fixed costs from the first euro
• immediate tax registration routes for legally present migrants and refugees
• mandatory digital payment and receipts for platform-mediated household work
• portable accident insurance funded by a small platform or client contribution
• transparent rules for time estimates, cancellation, waiting time and rating appeals
• strong anti-harassment rules, including client bans and evidence preservation
• automatic, simple tax reporting instead of paperwork that pushes people into cash.

The choice is not “platforms versus workers’ rights.” The choice is visible, taxable, insured flexibility versus invisible cash work.

Standard employment may be the right model for cleaners working full-time for one cleaning company, one institutional client or one agency. It is often the wrong model for a person who wants five, ten or fifteen hours per week across private homes; for a migrant building their first income; for a student, parent or part-time worker seeking flexible additional earnings; or for households that will never become formal employers.

We should not romanticise platforms. Platforms should be regulated. Bad practices should be fixed. Cleaners should have safety, transparency, insurance, dispute mechanisms and real options to build stable income.

But destroying the formal platform channel because it is not perfect is not worker protection. It is a gift to the black market.

The real world has changed. People change jobs more often, combine income sources, migrate, study, care for family members and look for flexible work. Regulation should help them do that legally.

Europe does not need to return domestic services to the twentieth century. It needs to make flexible work visible, taxable, insured and safe. That will not be achieved by fighting digitalisation. It will be achieved by allowing responsible platforms to build the infrastructure that the informal market never had.

If Europe makes flexible formal work impossible, cleaners will not disappear. They will simply disappear from the tax system, from safety infrastructure and from public visibility.

That would be the worst possible outcome for everyone — especially cleaners.

Ivan Shyla
Co-founder, CleanWhale