An interesting report in the FT this week about Deliveroo, the UK-based food delivery company, gives food for thought. The company, part-owned by Amazon, reported that the gross value of its customers transactions had risen 70 per cent in 2021. CEO Will Shu said he expected that growth to continue into 2022, and was not concerned at all about the EU Commission's platform work directive proposal, published in December.
In fact, Shu was "positive about the proposals” as he thought they would “confirm that the majority [of riders] are self-employed. Member states will interpret things differently.”
He added: “There may or may not be an impact on unit economics but if riders were employees then you would counteract by operating an employee fleet.”
Shu doesn't exactly get top marks for clarity, but we can interpret his remarks like this: he thinks there's sufficient wriggle room in the Directive for member-states to apply the law in such a way that riders will still be able to be hired on a 'self-employed' basis, and that at most some full-time riders will be employed whilst the rest won't (hence "employee fleet"). (Note: this is the model that Glovo is currently operating in Spain, where 20% of riders are hired by the company for its 'dark kitchen' operations while the rest continue to be self-employed (although this is being challenged by the Labour Inspectorate)).
The Gig Economy Project asked Leïla Chaibi, France Insoumise MEP who led the campaign for a strong EU platform work directive, about Shu's comments at an online event on Friday, and she was not surprised. In a debate with a CEO of a French gig platform recently, he had told Chaibi that having read the platform work directive he was not concerned by the criteria for employment status.
It's worth reminding ourselves of the five criteria in the Directive: effectively determining pay, binding rules regarding the performance of the work, supervising the work, restricting the freedom to organise one's work, and restricting the possibility to build a client base or work for a third party. Two out of five of this criteria has to be met for a platform worker to be considered an employee. Anyone remotely familiar with food delivery would think that at least four of these are clearly applicable, but multinational firms with expensively paid lawyers may see things rather differently.
And of course, the Directive will not be turned into law until it is ratified by the EU Council and the EU Parliament. Chaibi added that The Left group in the European Parliament is now preparing to campaign to amend the Directive so that just one of of the five criteria has to be met, while she expects some member-states on the EU Council which are particularly close to the platforms - including France, which has just taken over the presidency of the Council for 2022 - to push to amend the Directive in the other direction, so that "three, four or five" of the criteria has to be met.
As Nikolaj Villumsen, MEP for Danish left party Enhedslisten, said at the meeting: "The battle over interpretation [of the Directive] has already started." If anyone thought employee status for platform workers in the EU was a done deal, think again.
Ben Wray, Gig Economy Project co-ordinator
