Deliveroo’s pandemic profiteering has set the company up well for its IPO, which will make the CEO Will Shu hundreds of millions – but the problem of the company’s hyper-exploited gig workers is not going away.
Ben Wray is a freelance journalist leading BRAVE NEW EUROPE’S Gig Economy Project.
This series of articles concerning the Gig Economy in the EU was made possible thanks to the generous support of the Foundation Menschenwürde und Arbeitswelt
An international network of Deliveroo riders are highlighting the exploitation they have suffered in the pandemic to potential investors in the food delivery platform, as it prepares to float on the London Stock Exchange in a move which could reportedly make its CEO Will Shu a cool £662 million.
Deliveroo, the UK firm which tech giant Amazon has a minority stake in, could be valued at £7.2 billion in the stock market listing according to reports, but the company’s business model is based on gig workers who complain of low pay, dangerous working conditions and unfair deactivations from the company’s app.
The company, which operates in 12 countries, has seen revenues soar during the pandemic to £4.1 billion, up £1.6 billion on 2019. The company still recorded a loss of £223.7 million in 2020, but says that it is now operating profitably. But riders have seen their pay fall in that time, as the company’s deliberate over-supply of labour on the app pushes down rates per delivery and reduces the number of deliveries available.
Riders have also said the company has failed to provide adequate safety protections for them during the pandemic, when they were deemed to be essential workers by governments during lockdown, and are asked to meet unrealistic and dangerous delivery targets. According to the Leeds Index of Platform Labour Protest, Deliveroo is the most protested against gig labour platform in the world.
The company also faces court battles to maintain the ‘bogus self-employed’ status of its riders. A Dutch court ruled last month that Deliveroo riders should be considered workers, a finding that a Barcelona court also came to in January, in which it told the company that 748 riders must be given employment contracts.
In the letter to Shu, the International Rights 4 Riders Network state that they are “dismayed by your attempt to capitalise off the sacrifices of frontline delivery workers.”
The letter goes on: “Despite attempts by Deliveroo and other gig economy companies to misclassify riders, courts – including the UK and French Supreme Courts – are increasingly recognising direct employment relationships.
“And investors are increasingly seeing the legal, reputational and financial risks posed by predatory business models in the gig economy.
“Just Eat, one of your major competitors, has agreed that workers should no longer be misclassified as independent contractors. It’s time for you to take responsibility and reverse Deliveroo’s policy that treats riders as second-class workers.
“It’s time that Deliveroo stops sham contracting, paying poverty wages, compromising riders’ safety, unfairly terminating riders and ignoring their basic labour rights.”
Ahead of the IPO, Shu attempted to bolster his image as a CEO who cares about delivery workers by establishing a “Thank You Fund” which will give £16 million in total to riders, with an average payout of £440. The company said the cash payout was an alternative to giving riders shares in the company, which it can’t do because it does not consider them to be employees.
The move was described as a “stunt” by Alex Marshall, former delivery rider and President of the IWGB union in the UK.
“This is just another PR stunt by Deliveroo to try and divert attention from a workforce that has been exploited since the company’s inception,” he said.
Marshall added: “This does not come close to compensating riders for a lifetime of precarity and poverty pay. They should call it their apology fund. If they wanted to thank these key workers, how about they guarantee minimum wage, a fair terminations process and basic workers’ rights?”
Angelo Avelli of Riders x i Diritti in Italy, which is part of the International Rights 4 Riders network, said: “Recent rider deaths in Italy, Spain and Ireland are a reminder that the Deliveroo model is inherently unsafe, forcing riders to work faster and for longer hours without insurance or health and safety training. Deliveroo’s profits come off the backs of riders taking all the risks.”
Debbie Berendsen, Deliveroo rider and member of the Netherlands Trade Union Confederation (FNV), stated: “All of sudden one day, Deliveroo doubled the amount of co-workers in our town. There were not enough orders to go around anymore. After two years of working, I lost half of my income in just a few days’ time. That was really sad. We as riders stand in solidarity all over the world, taking Deliveroo to court and creating better work circumstances.”
The International Rights 4 Riders Network includes representation from unions and worker networks in ten countries, and is supported by the International Transport Workers’ Federation. They have launched a website in which riders and supporters can also send a letter to Shu.