Labor laws in European countries might not be as clear as some employers believe, especially when companies try to engage workers as freelancers rather than full-time employees.

Recent cases culminating in fines, repayments, and compliance costs have shone a spotlight on how some companies operate in the “gig economy,” as well as how difficult it might be for businesses to legitimately contract out work on a rolling basis.

Neil Hodge is a freelance business journalist and photographer based in Nottingham, United Kingdom. He writes on insurance and risk management, corporate governance, internal audit, compliance, and legal...