Deliveroo is now a household name in fast-food delivery and has become increasingly familiar to many during the pandemic, which has created a greater need for home delivered food. Couriers dressed in the Deliveroo colours, dashing to deliver on time, are a ubiquitous sight in Manchester and large cities across the UK. People taking Deliveroo deliveries may have been reassured by Deliveroo’s promises, repeated throughout the media, that they pay their food couriers more than £10 an hour on average. The gig-economy food courier giant has also said that its couriers are paid “well above the minimum wage”.
But, data gathered by an innovative online tool which allowed Deliveroo couriers across the UK to upload over 2,500 invoices, has cast light on Deliveroo’s opaque pay practices and claims, showing that Deliveroo are not delivering on their promises to their couriers or customers.
Data was gathered in an innovative online tool developed by the Independent Workers of Great Britain union, to produce the first reliable dataset on gig-economy pay in Britain. Over 300 couriers uploaded their Deliveroo invoices here, which include information on work “sessions”: when couriers logged in and all the deliveries they completed before logging out.
Analysis of the data covering the financial year 2020-2021 which included information on nearly 12,000 sessions from 318 riders working in the UK, was carried out by the Bureau of Investigative Journalism. The results showed that just over half, 56%, of the riders who took part, on average earned less than £10 per hour during the time they were logged in. Around one in three, 41%, received below £8.72, which for workers over 25 is the legal minimum wage. The Bureau also found one in six, 17%, of the sampled riders got less than £6.45 per hour, the level of the lowest minimum wage for under 25’s.
This investigations findings come at a particularly bad time for Deliveroo as it is poised to launch itself on the London stock market in less than two weeks. The flotation could earn the company’s chief executive Will Shu around £500m while informal estimates suggest Deliveroo’s value could be as high as £8.8bn. Shu has hailed the pandemic couriers as “heroes” for delivering food to communities affected by lockdowns.
How the fees are determined exactly remains unclear. A computer algorithm is used by Deliveroo to manage which riders are offered deliveries and another program is used to determine, leaving couriers unsure as to how orders are allocated to them or how their pay is calculated. To further add to the confusion the pay structure has been changed at least three times since 2017. In a previous report by The Meteor covering a Deliveroo strike in 2019 a courier reported that “the money we make per delivery is decreasing”. The data collected by the TBIJ also shows a trend of declining pay for couriers, with 11% getting below the over 25 minimum wage in 2018-19, this rose to 31% in 2019-20 and 41% in 2021.
Alex Marshall, the IWGB president, said : “What we have clearly exposed here is just the tip of the iceberg. These are the people who have fallen below the bare minimum requirements we expect for workers. This is before you factor in the cost of doing the job, the lack of rights, the lack of pension and the lack of holiday pay.”
Deliveroo responding to the TBIJ’s investigation said the findings were “not a meaningful or representative proportion” of their riders, and went on to say:
“Riders do not work in hourly patterns, and time logged on does not mean they are working: riders are free to reject work without penalty at any time and can work for other companies while logged in to our app.”
On claims of average pay for some being below the minimum wage Deliveroo said “from the moment a rider accepts a Deliveroo order until they complete the order. This is more than the national minimum wage.”
Deliveroo in the North West
Invoices received from Manchester, alongside Chester, Lancaster and Liverpool were included in the 96 invoices, covering 323 sessions, that were used to calculate figures for the North West region.
In the North West 76%, of the sessions were paid at a rate of less than £10 per hour during the time they were logged in, and 62% of sessions were paid at below the minimum wage of £8.72
Ian Allinson, executive member of Manchester’s TUC and a Unite union activist, who was a candidate for leadership of the union in 2017, said:
“Every worker needs enough to live on. The complex mess of different legal statuses for workers creates loopholes for companies like Deliveroo to get away with unfair treatment. These loopholes need to be closed and every worker should be entitled to good, secure, safe work with decent pay and conditions.”
A Deliveroo courier working in Manchester, who wished to remain anonymous, told The Meteor the problem of low pay is compounded by expenses incurred delivering food, saying he must cover expenses like “insurance, fuel, and wear and tear” to his car.
Allinson said: “These are clearly expenses of the workers doing their work for Deliveroo and the company should bear the costs of their activities… Much of the gig economy is not really based on useful innovation, its main driver is innovation in avoiding employment rights.
“When the loopholes these companies exploit are closed down the companies will have to adapt or lose business to companies, which are genuinely more efficient rather than hiding their inefficiency through their exploitative practices.”
Not enough invoice data was received for Manchester to allow an analysis of the level of pay for riders in the city alone. Couriers in Manchester, and across the UK can continue to use the online tool to confidentially upload their invoices and increase the data available on Deliveroo pay.
While riders may not be earning enough to live on and thrive in cities with fast growing living costs, Deliveroo has doubled the number of riders from 25,000 to 50,000 during 2020. This means riders are competing for deliveries while they themselves are unsure how the deliveries are allocated or how many couriers are logged in, on call.
Reece Lloyd a Deliveroo courier in Newcastle believes over hiring has led to riders earning less and getting fewer orders, and said: “So many new riders for the same amount of jobs means there is less for everybody else, so less money.”
Deliveroo couriers are currently classed as “self-employed” which means there is no legal obligation to offer a minimum wage or other benefits such as holiday or sick pay – a precarious position for riders in risky urban traffic. This self employed status is a common practice utilised by other gig-economy companies like JustEat, whose business models are heavily dependent on this kind of labour.
However, the employment status of Deliveroo riders could change after another gig economy behemoth, Uber had the status of its drivers confirmed as workers by the Supreme Court in February this year. This means these workers are now no longer classed as self employed by Uber, but are now employees entitled to national minimum wage rates and other employee benefits.
Professor Alan Bogg, a labour lawyer, said: “I would expect that approach to be applied to the Deliveroo case now.” In his view, “given the evidence the Bureau has identified about the low levels of pay for Deliveroo riders, in circumstances where they have no control over the contractual documentation, I have little doubt now that they would be treated as workers.”
Allinson is clear that there needs to be changes to employment legislation ensure better worker rights, saying:
“The government should tidy up the mess of different legal statuses for workers to ensure more consistent treatment, which would remove the incentive for companies to game the rules at the expense of workers.”
Deliveroo couriers can still load their invoices onto the IWGB database and increase the information available on Deliveroo’s opaque pay structure – click here
The Meteor is a media co-operative, if you would like to find out more about joining and supporting our work – click here.
Read the The Bureau of Investigative Journalism report – click here
Feature Image: Dan Spink