Who does not know the delivery services Foodora, Deliveroo, and UberEats. They are most famous for their environmentally friendly way of delivering food. In most Dutch cities these companies deliver food by bike. Even though this is very eco-friendly, these companies are not that friendly towards their employees. For example, Deliveroo wants that employees from February 2018 will not be in paid employment anymore, but continue as an independent proprietorship.
Now all employees are still in paid employment, so that they get paid an hourly minimum wage and are insured if anything happens to them during working hours. When they will continue as an independent proprietorship they receive no longer an hourly wage but they will get paid 5 euro per delivery, from which taxes still need to be deducted. Furthermore, the administration needs to be done by the proprietor himself, which will consume much time. But most importantly, these delivery men will not have any insurance. When they get hit by a car while they deliver food on their bikes, Deliveroo is not responsible. The delivery guy himself is responsible for all the costs caused by an accident.
Deliveroo does not want to change this business model without a reason. They think that the delivery men will profit from this change, as the minimum wage is very low, approximately 6 euros per hour. But with this piece rate, they are able to earn 5 euros per delivery. According to Deliveroo, a delivery guy can deliver approximately 3 meals per hour, so in this case the wage will indeed rise. However, delivery men themselves say this is not the case. They say that the average number of deliveries per hour is around 2, on a good day, however, on bad days there are often no deliveries at all throughout the whole hour. In combination with the increase in work due to more paperwork and the increased risk, the delivery men themselves do not benefit from this change in Deliveroo’s business model.
Then why does this change happen? By hiring the proprietors Deliveroo has lower administration costs, on top of that, they do not have to pay the delivery guy the time he is not doing a delivery. This saves them a lot of money.
Of course, this change in their business strategy received a lot of criticism. Mainly by the delivery men themselves. It is dangerous to cycle around the city, there is hectic traffic and as a cyclist you are vulnerable. As a response to this risk Deliveroo provides a public liability insurance, unfortunately accidents are not included, while accidents are the main reason a delivery guy would take an insurance.
Also, politicians and trade unions do not agree with this change Deliveroo wants to implement. They think it is terrible that Deliveroo lets young people work uninsured and not able to build any pension. Former minister Lodewijk Ascher states that companies like Deliveroo destroy the fair job market by avoiding any payment of employee premiums.
As a response to these measures, Sytze Ferwerda, one of the deliverers has begun a lawsuit. He thinks it is unfair that Deliveroo forces people to start their own proprietorship. Whilst Deliveroo’s main motive is making as much money as possible, by avoiding the responsibilities and risks that are involved with hiring employees. In order to afford a lawyer Ferwerda tries to receive 7500 euros through crowdfunding. To add to that, he receives support from the PvdA and the FNV (Federatie Nederlandse Vakbeweging). Furthermore, The Riders Union supports for Ferwerda’s statement, they suggest that Deliveroo transfers all the risks to the ‘employees’ to enable Deliveroo to go public. Other support comes from employment lawyer Peter van de Brink, who thinks Ferwerda has a good chance, which will have consequences for the other companies who have a similar business model as Deliveroo.
Current employment law is not adjusted for online companies like Deliveroo and UberEats. Which is a problem because now it becomes hard to check whether these employees are actual employees or act as a sole proprietor. These companies mainly operate throughout websites, often not only one website but several. Due to this, wages, insurances and working hours are hard to track. At this moment companies like Deliveroo make up a small part of the job market, but when this kind of employment starts to grow, the employment law needs to be adjusted for this specific type of employment.
Whether Ferwerda will actually win the lawsuit or not is something we will see. But I hope he will succeed. Even though Deliveroo has its reasons, and some independent proprietors will eventually earn more with this new business model, I do not agree with it. Most of the employees who work at Deliveroo, at least in the Netherlands, are students or high school students for whom this job is just a side job. I do not think these people should be an independent proprietor for just a side job. It should not be their burden to carry the risk and do all the paperwork. This is the responsibility of Deliveroo, as a company. If they want people to cycle for them around the city, they should also offer security and a consistent wage.