Archive for Gig Economy

Court Inquiry On The Gig Economy Might Lead To Meal Delivery Going Away

Aussies have a love affair with takeaway, with many couriers in Melbourne and across the country making a living delivering food for the meal delivery platforms like UberEats and Deliveroo.

There’s a problem, though, as these companies are under pressure regarding how they treat their delivery workers following a decision made by the Fair Work Commission (FWC) that deemed that a sacked Foodora worker was an employee, and not a contractor.

On November 16, 2018, the FWC ruled that a Foodora worker who spoke out on the pay and the working conditions the company’s couriers operate in, was unfairly dismissed by the food company. The worker is set to receive $15,559 in compensation in 21 days following the proceedings.

Foodora, owned by the UK-based Delivery Hero, shifted into voluntary administration for its AU operations back in August, but the decision by the FWC could have affects reaching out to the other delivery platforms operating down under.

By treating their couriers in Melbourne and across the country as contractors, companies like UberEats and Deliveroo avoid paying a range of benefits to them, which include, among other things, leave benefits.

In the case about the delivery worker, he only received $14/hour plus $5 for every completed delivery, back in 2016.  These conditions only worsened in 2018, prior to Foodora’s eventual shutdown in Australia.

The popularity of meal delivery platforms led to their rapid growth across Australia, but the law is catching up with the industry, and now many are wondering how the business model will move forward, especially if a broader precedent emerges.

According to Managing Director Athena Koelmeyer, Workplace Law, if riders being treated as employees becomes the norm, these delivery platforms will find it harder to operate. She says that the decision made by the FWC doesn’t mean the industry’s doomed, but it does make it clear that AU regulation is catching up with the gig economy.

Koelmeyer warned against assuming that everyone working in the gig economy is an employee, but stated that UberEats and Deliveroo will be looking at their operations in order to make sure that they aren’t crossing any lines; they operate via a platform, but when the riders sport their logos and give them other tasks, then they are, in fact, a part of the organisation.

The FWC has made several rulings in the past stating that riders are independent contractors, not employees, but Koelmeyer states that an overall precedent has yet to be set on the matter.

Deliveroo made no comment on the matter, but UberEats released a statement a few days after the FWC ruling saying that they are committed to building a long-term and sustainable business in the AU and are continuing their investment in their relationships with their delivery partners.