The battle to secure Britons’ food delivery cash as restaurants and pubs reopen was thrown into relief on Wednesday with UberEats promising expansion and JustEat revealing plans for thousands of new worker-status courier jobs.
Uber Eats said it is now available to 90% of the UK population after seeing more than 25,000 new restaurants join the app since the pandemic broke out - and announced that it plans to expand further this year.
While FTSE 100 online food delivery company, JustEat, said it would take on another 1,500 couriers via an agency set-up that conveys worker status - meaning the riders will be entitled to holiday pay, sick pay and pension allowances.
The company, which merged with Dutch business Takeaway.com last year, has been rolling out the new agency worker model across Europe, and has already signed up more than 2,000 people on these terms in London and Birmingham.
JustEat said it plans to create the 1,500 new jobs in Liverpool by the end of the year as part of its expansion of the model around the UK. It will also provide couriers with e-bikes/e-mopeds.
It came as the firms’ rival Deliveroo saw its share price sink further.
The delivery firm’s float was priced by its bankers at Goldman Sachs and JPMorgan at 390p - giving Deliveroo a £7.6 billion market cap at the IPO price - but stood at 232pon Wednesday afternoon, after falling by just over 4%.
A total of 70,000 Deliveroo customers bought shares in the company’s IPO, which has been dubbed “Floperoo”, and which brought issues around workers’ rights in the gig economy into the spotlight. It emerged that Deliveroo had set aside £112 million to cover potential legal costs in relation to efforts by workers to change their rights.
Both Deliveroo and UberEats riders are classed as self-employed, which the companies say allows flexibility. This status means that riders do not have access to the benefits enjoyed by those with worker status, and some argue that the model is exploitative of riders.
What employment terms are your food delivery drivers on?
Last month Uber was forced by a Supreme Court ruling to dramatically change its employment terms for drivers in the UK. Uber drivers are to be redefined from being “self-employed”, and therefore eligible for few benefits or guaranteed income, to be classified as “workers” with a minimum wage, pension access and holiday pay - at least for the periods in which they are actively driving for the company.
Deliveroo riders are self-employed. They are allowed to sign on to other apps such as Uber Eats at the same time as being signed up to Deliveroo’s, meaning, the company says, they have more real flexibility than Uber drivers.
While logged on, Deliveroo riders can reject jobs or change their minds after accepting a job with no consequences -unlike Uber drivers who are rated and scored by passengers and can be removed from the platform accordingly.
Deliveroo riders’ status has been challenged twice in the High Court and on both occasions it was ruled that riders have the flexibility of self-employed workers although the Independent Workers’ Union of Great Britain is considering an appeal.
Employment lawyers say Deliveroo claim it is in a jam: if it offers more perks to riders, such as a pension, the courts could then say it is effectively acting like an employer, meaning it should pay minimum wage and make them employees. That, in turn, would arguably make it financially unviable to allow them the flexibility to work for other delivery firms, reject jobs and so on.
Uber Eats riders are self-employed workers under similar conditions to Deliveroo’s.
The argument is that Uber Eats does not exercise the same degree of supervision and control over its riders as the Uber car service does over its drivers.
Riders are also mostly self-employed independent contractors, although it recently announced the new agency worker model.
Agency-recruited workers receive hourly pay rather than pay-per-job and a guaranteed minimum wage and pension contributions.
Rivals point out the number of agency workers on JustEat books are a fraction of the overall number of company riders. The firm says it is scaling up its rollout.