The debate over whether food delivery drivers deserve employee rights has once again entered the courts with a former Deliveroo driver taking the company to the Fair Work Commission to argue he was unfairly dismissed.
The case is the first of its kind in Australia against Deliveroo.
Ever since rideshare and food delivery apps launched in Australia, the legalities of the gig economy have been under the microscope.
Despite multiple cases around the country and internationally about alleged unfair treatment by these companies, not much has changed.
What is Gig Economy?
The “Gig” economy is made up of three main components:
- 1. Independent workers paid by a “gig” (ie. a task or project) as opposed to workers receiving salary or hourly wages;
- 2. The consumer needs a particular service, for example, going to the next destination or having a specific item delivered;
- 3. Companies that connect workers with consumers in a direct way, including using application-based technology platforms.
Companies like Uber, Airbnb, Lyft, Etsy, or TaskFilms act as a means by which workers are connected with – and ultimately paid for by – consumers. These companies make it easy for workers to find a job quickly, temporarily (i.e. gigs), which can cover any type of job, from musical performances to repairing leaking taps. However, one of the main differences between gigs and traditional work arrangements is gigs are temporary work participation and workers are only paid for that particular job.
So what’s the issue?
The main sticking point that sees drivers take companies like Uber and Deliveroo to court is whether delivery and rideshare drivers are employees or independent contractors.
Companies including Uber, Lyft, Menulog, Deliveroo and Uber Eats argue they are not delivery or rideshare services but instead provide a flexible platform to allow independent contractors to be in the business of food delivery and ridesharing.
“The companies say these people aren’t working for us, we are providing tech support to a business the contractors are running,” says Andrew Stewart, a law professor at the University of Adelaide.
“This is how their contracts are constructed. The contracts try to make it clear they are providing tech support to a contractor.”
But some drivers, backed by unions, argue they are being misrepresented and should receive worker protections such as minimum wage, annual leave, sick leave, superannuation and be protected by unfair dismissal laws.
Companies including Deliveroo, Uber Eats and Menulog will do anything to stop their riders being classed as employees under the law so they can avoid paying entitlements that could threaten the viability of their business model.
What have previous court cases ruled?
Unfortunately for the workers, there are a few details in their contracts that have continued to prevent courts from agreeing they are employees.
The most common include:
- – The ability for drivers to work for multiple platforms at the same time
- – No requirement of a uniform or for drivers to associate themselves with a company
- – Drivers/deliverers can work whenever they like and;
- – No-one is obliged to take up any jobs
But drivers and delivery riders argue they are not treated in this way and are instead threatened with being blocked from the apps if they refuse too many trips or deliveries.
Australian lawyer Sheryn Omeri, who is currently working in the UK and has represented Uber drivers in Britain, says the Fair Work Commission is having to contend with the novelty of the gig economy.
“People who work in the gig economy do not necessarily immediately look like employees in the traditional sense,” she said.
“The Fair Work Commission and the courts are accustomed to calling ’employees’ people who are contractually obliged to attend an office at 9:00am and not to leave until 5:00pm and to devote all of their working time to one employer organisation.”
The courts are grappling with the idea that someone may fall within the definition of an employee but have work arrangements that are completely different than anything they have seen an employee do before.
In the case of Uber, Ms Omeri argues that because once someone logs into an app, they must accept a certain number of jobs allocated to them or they will be forcibly logged out, they are being treated the same as an employee.
They also cannot cancel more than a certain number of jobs that they have already accepted without risking their account being permanently deleted.
“This, in essence, is the same obligation to work, and control by the gig economy employer, which characterises the relationship of the nine to five employee with his or her employer,” she said.
In a statement, an Uber spokesperson said people who drive and deliver with the company can “choose if, when and where they earn” and said there was “definitely” no requirement to accept a certain number of trips.
“Uber believes that everyone should have access to a set of affordable and reliable social protections, whatever category of employment they are in,” the spokesperson said.
Will upcoming court decisions make a difference?
Unfortunately, the chances of that are slim.
University of Adelaide’s Professor Stewart says, “The one thing you can guarantee is that we will not have certainty unless and until there’s legislation”.
One decision by a court is unlikely to set a precedent for the industry because of the nature of the industry; it’s flexibility.
“One thing we know is that platforms will contest any decision against them,” Professor Stewart says.
“Each of the platforms are constantly changing their work methods and contracts. They are constantly reacting to litigation, what’s happening in the market and what their competitors are doing.
“This litigation might end up being an incredibly significant case but it’s not going to be particularly significant until there’s an appeal that makes it up further and into higher courts.”
A precedent could theoretically be set if a case gets to the High Court. But University of Sydney Professor of Labour Law Shae McCrystal says this is unlikely because of the way the law works.
“Just because you hire person A and they are found to be an employee it doesn’t mean person B is an employee. It’s not automatic,” she said.
“The company could just change their contract terms to look more like self-employment.”
What is the difference between employees and contractors?
The Independent Contractors Act 2006 in conjunction with the Fair Work Act 2009 protect the rights and entitlements of independent contractors.
There are a number of factors which may contribute to determining the difference between an employee and independent contractor. However, it is important to note that no single indicator can determine if a person is a contractor or an employee. Each determination is based on the individual merits of the work arrangement in place. Courts always look at the totality of the relationship between the parties when determining the status of a person’s employment.
There are some common indicators that may contribute to determining whether a person is an employee or independent contractor:
Degree of control over how work is performed
|Performs work, under the direction and control of their employer, on an ongoing basis.||Has a high level of control in how the work is done.|
Hours of work
|Generally works standard or set hours (note: a casual employee’s hours may vary from week to week).||Under agreement, decides what hours to work to complete the specific task.|
Expectation of work
|Usually has an ongoing expectation of work (note: some employees may be engaged for a specific task or specific period).||Usually engaged for a specific task.|
|Bears no financial risk (this is the responsibility of their employer).||Bears the risk for making a profit or loss on each task. Usually bears responsibility and liability for poor work or injury sustained while performing the task. As such, contractors generally have their own insurance policy.|
|Entitled to have superannuation contributions paid into a nominated superannuation fund by their employer.||Pays their own superannuation (note: in some circumstances independent contractors may be entitled to be paid superannuation contributions).|
Tools and equipment
|Tools and equipment are generally provided by the employer, or a tool allowance is provided.||Uses their own tools and equipment (note: alternative arrangements may be made within a contract for services).|
|Has income tax deducted by their employer.||Pays their own tax and GST to the Australian Taxation Office.|
Method of payment
|Paid regularly (for example, weekly/fortnightly/monthly).||Has obtained an ABN and submits an invoice for work completed or is paid at the end of the contract or project.|
|Entitled to receive paid leave (for example, annual leave, personal/carers’ leave, long service leave) or receive a loading in lieu of leave entitlements in the case of casual employees.||Does not receive paid leave.|
For more information on workplace rights, please contact Fair Work Online: www.fairwork.gov.au or Fair Work Infoline: 13 13 94
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Contact the Translating and Interpreting Service (TIS) on 13 14 50
Source: ABC and Fair Work Australia