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Aug. 12, 2021, 7:34 a.m. EDT

Uber Eats other food delivery firms under the spotlight in Spain as new laws come into force

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By Associated Press

MADRID (AP) — A new law requiring food delivery companies in Spain to hire delivery riders and drivers as employees rather than freelance contractors took effect Thursday with labor unions urging close monitoring and inspections to enforce it.

Spain’s Trade Union Confederation said the so-called Riders Law would “put an end to the labor fraud that workers in this sector have suffered for too long..” The confederation, known by its Spanish acronym CCOO, said the labor ministry and inspectors should ensure compliance with the law through monitoring, evaluation and reporting.

The law classifies food delivery riders as employees of the digital platforms they work for, not self-employed. It covers an estimated 30,000 workers.

Legislation approved in May also requires companies such as Spain’s Glovo and America’s Uber Eats /zigman2/quotes/211348248/composite UBER +1.84% to hand over to worker legal representatives information about how their algorithms and artificial intelligence systems function in assigning jobs and assessing performance.

App-based food delivery businesses say the law threatens a 700-million-euro ($851 million) industry in Spain. U.K.-based Deliveroo /zigman2/quotes/225812915/delayed UK:ROO -5.01% has said it plans to exit the Spanish market pending a mandatory consultation with workers. Some workers have also objected, saying the freelance model gave them flexibility.

Riders For Rights, a gig economy union, noted that with temperatures soaring past 38 degrees Celsius (100.4 F) in many parts of Spain on Thursday and a heat wave expected to last for several days, workers had not been offered any form of heat protection or extra pay.

“Companies will continue to fail to comply with the legislation,” the union tweeted. “As long as it is cheaper for them to pay fines than to hire us, this fraud will persist. They do not understand laws and legislations.”

The CCOO said it was working with Just Eats on new contracts for riders. Glovo has said it will hire 2,000 delivery workers as employees to comply with the new law but maintain the rest of its workers as freelancers. Uber Eats has said it plans to subcontract out some of its services.

$ 23.78
+0.43 +1.84%
Volume: 35.20M
May 23, 2022 4:00p
P/E Ratio
Dividend Yield
Market Cap
$45.85 billion
Rev. per Employee
UK : U.K.: London
£ 88.34
-4.66 -5.01%
Volume: 2.23M
May 23, 2022 4:35p
P/E Ratio
Dividend Yield
Market Cap
£1.73 billion
Rev. per Employee

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