Deliveroo abandons plan to force ‘absurd’ new contract for staff

Workers win guarantees there will be no job losses or victimisation

Zlata Rodionova
Wednesday 17 August 2016 18:19 BST
Delivery drivers protest outside the company’s London HQ last week
Delivery drivers protest outside the company’s London HQ last week (PA)

Deliveroo riders have been celebrating after the company confirmed it would not force them to sign new contracts agreeing to a trial pay scheme that could see them earn barely half the National Living Wage.

The takeaway firm offered concessions in its pay dispute with workers after staff staged a protest and politicians waded into the row.

Deliveroo confirmed it will allow riders to work under their previous pay agreements instead of participating in a trial pay scheme, which pays £3.75 per delivery rather than the current terms of £7 an hour and £1 per delivery. The new voluntary trial scheme is due to start on Wednesday.

Employees who participated in the six-day strike were also told that there would be no threats of job losses or other victimisation against workers who demanded a guaranteed hourly wage, according to the Independent Workers Union of Great Britain (IWGB).

While riders who have already signed the new contract terms will no longer be bound by it, the union said.

Deliveroo pay protest

“This strike has exposed Deliveroo and their disingenuous methods for what they really are. A week ago Deliveroo were forcing us to sign a new contract under the immediate threat of losing our jobs, and on the false pretence it was a trial," Tom Hobbert, a Deliveroo courier who took part in the strike, said.

"Today our strike has secured a guarantee they can go return to work as normal without fear of victimisation,” he added.

Final decision on pay will be taken at the end of the trial scheme on 14 September. At this stage 280 of the 3,000 Deliveroo riders in London are participating in the trial.

Riders who wish to stick with the old agreement were told to move over to a neighbouring delivery zone, no more than two miles away.

In a blog on Deliveroo’s website, Will Shu, the company co-founder, said he believes that average driver’s fees will increase under the new pay scheme.

On Monday, Shu already apologised for allowing the pay dispute between its couriers and the firm to escalate, saying Deliveroo couriers were the “life-blood” of the company.

“We have consistently heard from our riders that flexibility is of the utmost importance – and so, the trial of our pay-per-delivery scheme is designed to provide just that,” Shu wrote in a blog post on Tuesday.

“For many riders, this means they can study, or take care of their children, they can work on a passion project or for Addison Lee – it means a less rigid and inflexible existence,” he added.

A spokesperson for Deliveroo told the Independent: “We are moving ahead with our trial as planned today with 70 per cent of riders in the trial zone opting in.

"We’re confident our riders will see the benefit of our trial payment model and are offering them payment guarantees so they can feel secure about trying it out. We’re also operating an open door policy for our riders to come and ask any questions they might have.”

But Mags Dewhurst, chair of the IWGN Couriers and Logistics Branch, which helped facilitate courier's action and demand, said tech companies use the "language of flexibility" as a cover to drive down wages and workers conditions.

“The fact drivers achieved this by staying united will inspire hundreds of thousands of people on precarious contracts. This week has shown that high-tech businesses and unscrupulous employers will not inevitably drive down wages as long as we can act effectively for a better alternative. In our case the social network struck back against the gig economy and won,” she said.

“This strike represents a new model of organising workplaces traditionally deemed ‘un-unionisable,’" she added.

Deliveroo drivers took to the streets of central London on Thursday last week in response to changes to payment schemes, having been told that accepting new terms was a "compulsory requirement".

On Sunday, the Department for Business, Energy and Industrial Strategy insisted Deliveroo employees must be paid the national living wage of £7.20 an hour unless a court or HM Revenue and Customs defines them as self-employed.

The National Living Wage of £7.20 for everyone aged over 25 years old – hailed as the new minimum wage – was announced by the former Chancellor George Osborne in April this year. Yet nearly 200 employers have been recently named and shamed for failing to pay that minimum wage to their workers.

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