The Gig Economy Project speaks to Robert Walasinski about whether the emergence of the food delivery sector in Austria has disrupted the country’s traditional system of collective bargaining. Interview available as a podcast or in text form.
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When food delivery platforms land in a country, they arrive into pre-existing labour market and industrial relations norms. In some countries, those norms can be relatively conducive to the business model which these platforms want to impose, while in others it can make things more complicated for the platforms.
Austria is a case of the latter. In Austria collective bargaining remains at the heart of industrial relations, including in the private sector, with almost all workers covered by a collective agreement, even if they are not in a union. Works Councils exist which give workers some degree of insight and influence over corporate decision-making. While trade unions are not as strong as they once were, they are much more firmly rooted in the economy than in most European countries.
How has the food delivery sector fitted into this picture in Austria? What success have unions had in curbing the excesses of food delivery platforms? And what can unions and riders in other countries learn from union organising in Austrian food delivery?
To discuss all this and more, the Gig Economy Project spoke to Robert Walasinski, project manager of the Riders Collective, which is part of the International Department of the Austrian Trade Union Federation (ÖGB).
We discuss:
01:50: Have food delivery platforms disrupted Austria’s social partnership model of industrial relations?
22:18: Union organising in Austria’s food delivery sector
31:15: Wolt’s entry into the Austrian market
34:50: The importance of gig worker organising internationally
AN ABBREVIATED TEXT VERSION OF THIS INTERVIEW IS AVAILABLE BELOW
Gig Economy Project: I first want to place the platform economy in the wider context of Austria’s labour market. One of the interesting things about Austria is that it seems to have an almost Nordic approach to labour issues, where sectoral collective bargaining between employers’ associations and unions takes precedence over government regulation. 98% of employees in Austria’s private sector are covered by a collective agreement, a remarkable figure. Has the emergence of the platform economy in Austria disrupted that traditional social partnership model, or have you been able to fit them into the traditional system of industrial relations?
Robert Walasinski: On the one side, yes they have disrupted the model, on the other side, yes we have been able to fit them into the traditional system of collective bargaining.
We fitted them through the collective agreement for bike messengers [riders]. There’s no word about platforms or the gig economy in this agreement, we just took the traditional approach that bike messengers are covered by the collective bargaining agreement, and as long as food deliveries are done by bike, they are covered by it. If they would start going by cars for example, another collective agreement would be necessary. There are no specific regulations for platforms. Nothing specifies what is a platform by law or any other means.
Then on the disruption side, you have to look at who is and isn’t covered by the collective agreement. The agreement was established in 2020 and every worker that has an employment contract is covered by it. The collective agreement came about because we were able to get a Works Council established in Foodora [owned by Delivery Hero] and together with the trade union and the Chamber of Economics we managed to get it settled.
The collective agreement has the basic things like the basic salary, the working time (which is 40 hours), bonus for Sundays, remuneration for your phone, kilometre allowance if you are using your own bike, and these sort of things. It is re-negotiated every year.
The disruptive part is that at Foodora you have free service contractors, who are not covered by the collective agreement. In Austria there are around 4,000-5,000 workers in food delivery, and approximately 2,000 are covered by the collective agreement.
The free service contract is a pain in the ass, because it is not covered by the collective agreement but you are seen as a person who is close to being an employee, so you can become a union member but the union cannot bargain anything that is legally valid in the collective agreement. So it’s an in-between status. For example, you get social insurance, it’s not like self-employment where you need to do your own insurance, but you don’t have paid holidays, you don’t have proper paid sick leave, you have a kind of paid sick leave which is about 50% of the average of the last three months, which is paid by the social insurance not the employer.
This is why it’s very sexy for the platforms to use these type of contracts. You also can’t join the Works Council, so this weakens workers’ organisation because the free service contractors are officially seen as not part of the company. Of course, in reality this is complete bullshit, the free service contractors do the same job, they just have less rights.
GEP: The FairWork academic-action project produced its first ratings of Austrian platforms last year, giving Lieferando an eight out of 10, while Foodora was given just four out of 10. Do you think there is a significant difference in labour conditions and wages depending on whether you are an employee or on the free service contracts?
RW: There is definitely a difference. Maybe not at the first glimpse, or in the first few months on the job, but there is definitely.
In the case of Lieferando, they only have employees, that’s what makes this an eight out of ten. They are quite okay.
If you are on the free service contract, you are paid per delivery which means that in certain hours and days, Sunday evening or stormy weather, you can definitely make more money than with an employment contract. But this is only in the short run. If you count it to the end of the month or across a year, you are way better off with the employment contract than the free service contract. Because if you get sick for two weeks and you don’t get sick leave, how do you make up that lost income? And as part of the collective agreement you get christmas and holiday payments, what we call 13th and 14th income; you don’t get it if you are not in the collective agreement.
GEP: Do you have any fear that Lieferando will move away from its employment model? Because in the UK, Just Eat recently sacked 2,000 employees and moved back to an independent contractor model.
RW: Yes, definitely. That’s what we are fighting against and why we say it’s an issue if you have companies that can avoid collective agreements just by handing out different contracts. There’s a big discussion about this and that’s why we put our hopes into the European Platform Work Directive to solve this issue.
The danger is that not only Lieferando but all the other companies start asking themselves, ‘why should I take the risk and pay for my workers when they are sick, when I simply don’t have to?’ Every company could say, ‘fuck it, we do free service contracts and we’re better off’.
Because then to prove that you shouldn’t have a free service contract you need to go to court, and who’s doing that? This takes time and it takes money. We have never had a worker go to court in Austria to define that this is not a free service contract.
GEP: The final status is self-employed. I understand that undocumented riders often work as self-employed in Austria, and that they often have to work via sub-contractors where working conditions can be a lot worse. Can you tell us about that?
RW: The number of undocumented workers is way lower than in France, Belgium or Spain, so it hasn’t been an issue that is very visible for us.
What we do know is that it is affected by the migration law. If you come to the country, you apply for asylum and as long as you are in the process of applying for asylum, and this can take years, you are not allowed in the labour market except some exceptions. You can only be self-employed. You have to open your own business, and then these workers land in the hands of the sub-contractors, which is controlled by one or two big groups in Austria.
The situation of undocumented riders is way, way worse [than other riders], because they don’t have any type of backing. As an employee I can either be part of the trade union or the trade union steps in for me to fight against my employer. If I’m not part of the trade union, then the Chamber of Labour can still do some things for me. But as a self-employed person, you are by law not part of this group. So you have no one to help you out.
We have seen some issues already with the sub-contractors and self-employed workers, that they got sued by one of the sub-contracting companies which made wrong allegations, and usually the Chamber of Labour or union would jump in to represent this worker, but in this case they are treated as they are like a company because they’re considered self-employed, so they have to deal with it by themselves. Although in reality this person is a worker, it’s just because of this bogus status.
This is a very delicate topic, because we didn’t find yet a proper strategy to tackle this issue, because it comes into the delicate issue of migration laws which is always a good issue for the right-wing.
GEP: Do the unions want to see government regulation of the food delivery sector, and what’s the likelihood of that happening under the current People’s Party and Greens coalition government?
RW: It’s a right-wing government, very neoliberal, and they say ‘we have existing laws, and they work’. That’s basically the approach of the People’s Party.
It’s true that we have existing laws and you can go to court to try to define if you are an employee or not. It works for you if you are doing it. But if you are not doing it, the companies can continue as they are.
There is no political will from the current government to create any regulations in this sector, also not on the European level, because in their opinion everything is great. The trade union has a strong interest to get regulations into this sector, by addressing the problem of free service contractors, although that doesn’t solve the problem of self-employed couriers. But there is a long way to go before there is any regulation, and it really depends on the next elections to be honest.
GEP: I know that in Austria the food delivery sector grew very quickly during the pandemic. In many European countries we are seeing a retreat of food and grocery delivery platforms in the context of the cost of living crisis and a reduction in investment from venture capital, and also attacks on riders’ wages to lower costs. Are you seeing any signs of this in Austria?
RW: I would say that it is stabilising at a certain level in the last 1-2 years. We had grocery delivery players come into the market like Flink and Jokr, but I don’t think they even stayed in the market for a year. Foodora also does grocery delivery now as well as food delivery, they also claim to do pharmacy deliveries.
GEP: In many European countries, riders’ wages have been pushed down as the platforms come under more financial pressure. In Austria, presumably the collective agreement has helped block an attack on wages?
RW: It has definitely, because it sets a minimum wage. In the last negotiating round the employees got a wage gain of about 8.5%, and the platforms get pressure from the free service contractors also to raise their incomes.
There has been no direct attack on the wages of free service contractors, but there has been a change in the payment system, which changed from a fixed 4 Euros per delivery no matter the distance, to a more dynamic pricing model which takes the distance into account. Foodora claim this is an increase in income, but our people say that it stayed the same.
GEP: Let’s talk a bit about the union organising through the Vida union, the role of the Works Councils and the role of the Riders Collective, which I think plays a kind of activist, social movement role. When did this all get started and how has it developed?
RW: Yes, Vida is the union that is responsible for the Works Councils and that sort of stuff. And at the Riders Collective we are connected to the international department of the Austrian Trade Union Confederation (ÖGB) because it all started from a project of building a network of platform workers internationally.
We started in January 2021 and our role is to be the activists. We all either work as a rider for the companies or we used to work for the companies, and we have a very close relationship with the Works Councils. We provide a space, which is called the Riders Collective Space, where people can come in, get first-hand information or just go to the toilet and get a drink or whatever. That helps to overcome the gap of not knowing that a union exists or the Chamber of Labour exists. So we try to fill the gap and push the companies with public opinion. If there is anything that comes up we are addressing it on social media, putting it out to the media, and so on. So we also kind of have a role of a watchdog.
GEP: Union density in Austria was at 26% in 2019. Do you have an estimate of union density in the food delivery sector?
RW: We have been able to increase the numbers from a very low-level to a remarkable one, I would say. We have now ten times more members than we had in 2019 or 2020, but we started very low. So we started with about 40, and now we have 250-300 members across Austria.
Also we have established Austrian wide Works Councils, because before they were only in Vienna. This year we had elections all over Austria and this is a boost to organising.
GEP: What exactly do the Works Councils do for workers?
RW: They are elected by the workers and depending on the size of the company they can be from 5 to 10 people. It negotiates with the management for the workers. The management has to inform the Works Council about cancellations or any major changes, and they have to consult together. They are protected by law and so cannot be kicked-out by the company.
GEP: What do you think holds the key to going from where the labour movement is now to a stronger position in Austria’s food delivery sector?
RW: What is hindering us from becoming stronger is the free service contracts. Because you have no rights you can claim from this kind of contract, and that makes it difficult to unionise. If you have the free service contract and are paid by delivery, the riders don’t have the time and they don’t want to discuss getting in the union. They say: ‘Does it bring me money? No. So I don’t need it. It’s precarious work. You just need to struggle to survive.’
As long as the free service contract is legally possible and we do not have tools to collectively bargain for them, this will always be a little bit hindering us from getting stronger. That is the biggest issue and that is why we are so strongly against these free service contracts, because they are not really free service contracts in the way they are run by this one major company [Foodora].
Also, as the Riders Collective we are in quite a lot of discussions with the trade union about what leverage we can have to address the free service contracts. We have developed some ideas and strategies but this is very much depending on the companies, so I doubt this will work out. My experience with these companies is that if you don’t come with the big legal hammer, they don’t move, they don’t do it, because why should they?
We had [Foodora] protests last winter, and they simply hired new people. The protests were about the fact that everything got more expensive and people didn’t get more money, they didn’t get a pay raise. Employees got a pay raise because of the collective agreement and the free service contractors simply didn’t get it.
The strategy of the company, like everywhere, is simply to get new people. They hope the workers leave so they can get the next ones, and they have methods for how to do this, like internal ratings, how much shifts you get, and so on. This was a big issue over summer. They hired a lot of people, gave them access to the shifts, so the older fleet had no access to shifts and simply couldn’t work. You are under contract, but you can’t work, because you don’t get the shifts to do so. All the newbies got the shifts. So the old fleet say, ‘one month, no income, I leave’.
GEP: Wolt recently entered the Austrian market. I read an interesting piece on the Rider Collective website by Adele Siegl about this. She said it took just two weeks for protests by riders to start outside of Wolt’s Vienna HQ, which is in line with what we have seen elsewhere in Europe this year, where there have been strikes and protests in almost every country Wolt operates in. Can you tell us about this?
RW: It’s quite funny, because those Foodora riders who were protesting last winter, they got so fed up they all changed to Wolt. But they already had three or four protests, they were already angry, and they knew what to do to put pressure on the companies, so they didn’t let Wolt get away with any type of tricks that they began to do at the beginning. That was quite interesting.
When Wolt entered the market at the beginning of May, they promised a fixed-hourly salary of about 13 Euros, because they had just entered the market and there were no deliveries. So you could take shifts and get this gross pay of 13 Euros just by riding around in the Wolt uniform. They promised to do this for the whole month, and then in the middle of the month they said ‘actually this costs a lot of money just to let people ride-around with empty back-packs’, so they decided to cancel it. So the riders were super-angry because Wolt had broken their promise from one day to the next. This group of riders went to the office and immediately Wolt gave back all of the shifts, they said ‘sorry this was a misunderstanding, here are your shifts again, no hard feelings, etc’.
Since June it has been paid by delivery in a dynamic pricing model. But so far Wolt behave better than Foodora does, because there are no sanctions, the money is slightly better than Foodora, you can choose whether you want to take the delivery or not. So Wolt have tried to use the free-service contracts in a good manner, for now. It’s always like this with the companies where at the beginning they are nice and shiny and then they begin to stink, so we are just waiting for the smell…
GEP: I know that you and your colleagues are very engaged in the international scene. Why is that something important for your organising work in Austria, and what’s your feeling about current developments around the EU Platform Work Directive?
RW: It’s very important for us because these are multi-national countries that know exactly what’s going on in the other countries so we also need to know what’s going on in the other countries.
We learn from other initiatives and groups, what they are doing and what their struggles are. When you go more to the East of Europe they are a bit different and a lot less organised than in western Europe, but it’s very interesting to exchange with these groups and make sure there’s awareness of ‘what does it mean if this company enters the market?’, ‘what does it mean if you work in this status?’, and so on.
This leads into the EU Directive, because this international network which was established in 2017-2018, from the beginning we were involved in putting on political pressure for the Directive, to find a solution for this business model, because it can’t be that they can just come in and say ‘hey I’m a tech company with an app, no laws apply to me’: that can’t be the way things are.
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