A few weeks ago we reported on the dynamics of Spain's food delivery market: Glovo, the largest food delivery platform in Spain, was growing its market share at the expense of Uber Eats, because whereas the former was continuing to ignore the Spanish Government's 'Rider's Law', the latter was hiring riders via sub-contractors, which meant assuming additional labour costs per rider, having fewer riders on the streets, longer waiting times for deliveries and, ultimately, higher prices in an attempt to maintain revenues.
Now, Uber Eats have made their unhappiness about the situation public, writing an open letter to Minister of Labour Yolanda Diaz claiming that they cannot find enough food delivery couriers because they would all rather work on a self-employed basis for Glovo. The letter goes on to say that the government has "failed to enforce the Rider's Law" and as a result "the disadvantaged situation of all the companies that do comply with it gets worse every day".
"Faced with this situation, we all ask ourselves the same question: Should we follow Glovo's example and work with freelancers to be able to compete on equal terms?"
There is plenty of criticisms that can and should be made of the Uber Eats' letter. First, it's highly questionable that they have stuck rigidly to the Rider's Law, and are in fact facing legal action of their own from the CCOO union for an illegal transfer of workers to sub-contractors on the day the Law came into force. Secondly, there's no evidence to back up the argument that they can't find riders because they prefer to be self-employed. The greater supply of Glovo riders is likely to be because many of them do not have citizenship, and thus cannot apply for a job as an employee but can sub-rent a Glovo account. Furthermore, if Uber Eats wanted to raise wages and improve conditions, they would surely have a rush of new riders willing to work for them.
Despite all of that, Uber Eats does have a point. Glovo is illegitimately stealing a march on its competitors. The Ministry of Labour responded to the open letter by telling El Diario that the Labour Inspectorate "is already acting" to enforce the Rider's Law, with "action being taken to verify that the digital distribution platforms engage in practices that fraudulently try to evade the application of the rule". But the Labour Inspectorate is moving much slower than the reality on-the-ground of the Spanish food delivery market, and even when the company is eventually hit with fines, will the punishment be severe enough to claw back the gains it has made from evading the law? And if not, what's stopping Uber Eats and co from making good on their threat to "follow Glovo's example"? The Rider's Law is in danger of unravelling if the government cannot quickly prove it is capable of enforcing it.
This is a battle between the power of democratically elected government versus corporate power. We should all fear living in a world where companies like Glovo can dictate the rules.
Ben Wray, Gig Economy Project co-ordinator
