After its IPO flop, Deliveroo has this week been hit by its workers striking for their rights, reports Yonas Makoni
Things are going from bad to worse for popular food delivery service Deliveroo and their fellow app-based super-exploiters.
On Wednesday, Deliveroo drivers went on strike, cycling through central London and waving flags and setting off flares. Smaller protests were also held in Reading, Wolverhampton and other towns across England. Nicknamed the Roovolt, the strike aims to challenge the company’s exploitative practices and secure workers’ rights for drivers.
Deliveroo drivers currently make as little as £2 per hour. According to the Bureau of Investigative Journalism, 41% make less than £8.72 per hour (the minimum wage for over 25s) and 17% make less than £6.45 per hour on average. Being classed as self-employed by the company, drivers have no entitlement to a minimum wage, sick pay or other basic workers’ rights.
This business model has been threatened, however, by a case in the Supreme Court in February, in which judges ruled that drivers from another gig economy company - Uber - were, in fact, workers and should be treated as such by the company. After much bluster and denial, union pressure eventually forced Uber to implement many, though not all, of the changes ordered by the court. While this case only applies directly to Uber, it will likely have significant consequences for other gig economy companies like Deliveroo and can be cited as precedent in potential cases against them.
This news could not have come at a worse time for Deliveroo, whose Initial Public Offering (IPO) on the stock exchange took place last week. A few days before the company went public, investors began to desert them en masse, calling it a “ticking time bomb”. This reflected widespread fear that granting drivers basic workers’ rights would make Deliveroo - already a loss-making company - unviable in the UK. Pointing to a new awareness among the capitalist class of the way the wind is blowing, David Cumming, chief investment officer at billion-pound firm Aviva Investors, told the Guardian:
“A lot of employers could make a massive difference to workers’ lives if they guaranteed working hours or a living wage, and how companies behave is becoming more important.”
In the event, more than £2 billion, or 31%, was shaved off the company’s original valuation of £8.8 billion. In a way, this was actually an overvaluation, as nearly a quarter of the stock was bought up by Goldman Sachs, as part of a deal with Deliveroo, in an attempt to stabilise the price.
This has emboldened the drivers and their union the IWGB, who scheduled their strike to start on the day that Deliveroo starts “unconditional trading” on the stock exchange. More than 200 drivers joined the protest in London, picketing outside the company’s HQ and riding their bikes and mopeds through the city.
Workers argue that, while they have been working on poverty wages, Deliveroo has been bringing in thousands of new riders, disadvantaged by the pandemic, to push delivery costs down. Because of this oversupply of labour, drivers are often forced to wait unpaid for hours until an order becomes available.
Unsurprisingly, Deliveroo’s response has been to dismiss and smear the protesters. They dismissed the union as a “fringe organisation” and claimed that its workforce is perfectly happy with their conditions. The tide is clearly turning against the company and its competitors, however, and not just in Britain.
In Italy, a Milan court ruled that food delivery couriers should be treated as workers and fined companies €733 million for failing to comply with employment safety laws. Last month, the Spanish government introduced legislation to give gig economy workers employee status and give unions the right to access company algorithms. Similar developments are taking place in France and the Netherlands and the EU is also working on legislation to protect gig workers’ rights.
Across Europe, the gig economy is crumbling. This is not due to the goodwill of our governments, but because workers across the continent are taking a stand against exploitation. If the Deliveroo drivers succeed in their efforts, it will be a huge boost to this growing international movement. We must all join the Roovolt!
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