Deliveroo bows to pressure over ‘egregious’ rider agreements

Deliveroo, the food delivery service whose soaring revenues have turned it into one of Britain’s biggest technology firms, has bowed to political pressure to overhaul the terms on which thousands of riders work for the company.

Sky News has obtained a new version of the "supplier agreement" used by Deliveroo, which handles takeaway orders for restaurant chains such as Byron, PizzaExpress, Rossopomodoro and Wagamama.

It was due to begin circulating the contract to its 15,000-strong network of UK-based riders on Thursday.

The company has removed a stipulation in earlier contracts saying that couriers could not challenge their self-employed status at an employment tribunal – a clause that had been described as legally invalid and which people close to Deliveroo said had never been enforced.

The document also includes the explicit clarification that couriers can work for other companies at the same time as they undertake work for Deliveroo – a key change that MPs had urged in a critical report on the so-called "gig economy" earlier this year.

"We know that many riders work with other companies as well as Deliveroo, including our competitors," Dan Warne, Deliveroo’s UK and Ireland managing director, said in an email to couriers.

"That is fine with us: as an independent contractor you are free to work with whoever you choose and wear whatever kit you want.

"There continues to be no requirement to wear Deliveroo-branded kit while you work with us, but please make sure that whatever you wear while riding means that you are safe and visible to other road users."

At four pages, the new "contract" is a quarter of the length of those used by Uber, the ride-hailing service, and one-fifth of those used at Amazon, the internet retail behemoth, according to details submitted this year to the Work and Pensions Select Committee.

The document says that riders will no longer be required to give Deliveroo notice of their intention to stop working for it, although the company will still give one week’s notice if it wants to terminate its agreement with riders.

The timing of Deliveroo’s decision to release the new agreement is significant, coming midway through a General Election campaign in which Labour has promised a clampdown on employers who take advantage of workers not employed on conventional contracts.

Labour has pledged to ban zero-hours contracts, while its draft manifesto leaked this week said the party would give all workers the right to have access to trade union representation.

Like companies such as Uber and Hermes, the parcel delivery firm, Deliveroo has found itself in the crosshairs of critics who argue that they are riding roughshod over their workforces by refusing to treat them as employees.

Matthew Taylor, a former policy chief under Tony Blair, has been asked by the Government to produce a report on workers’ rights, which is expected to include a recommendation that companies should pay a premium wage to staff employed on zero-hours contracts.

It emerged in March that a group of 20 Deliveroo couriers were drawing up plans to challenge the company’s assertion that they are self-employed contractors in a bid to obtain employment rights such as the minimum wage, sick pay and holiday entitlement.

Frank Field, the Labour MP who chairs the Work and Pensions Committee, had described the terms on which Deliveroo obliged its riders to work as "egregious".

A source close to the company said the new supplier agreement demonstrated that it was honouring the commitments it had made to MPs when giving evidence earlier this year.

The document makes it clearer that Deliveroo riders can appoint a substitute to carry out deliveries on their behalf, but makes it clear that the signatory to the contract "will continue to bear full responsibility for ensuring that all obligations under this agreement are met".

Riders will continue to be paid in the same way in terms of tips, fees and petrol calculated "depending on local market considerations".

Deliveroo has risen rapidly to become one of the UK’s most promising tech companies, last raising new funds in August, when it sold £200m-worth of shares to a consortium of investors.

It is widely expected to seek a public listing at some point in the future, although it faces stiff competition in its home market from the likes of UberEats, Just Eat and Amazon.

Earlier this year, it appointed Thea Rogers, a former aide to George Osborne, to a top management role.

Deliveroo declined to comment on Thursday.

(c) Sky News 2017: Deliveroo bows to pressure over ‘egregious’ rider agreements