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As EU eyes 'balance' on precarious gig work, Glovo offers pledge of 'fairer' conditions for couriers

·21-min read

Spain's on-demand delivery platform Glovo has announced what it's calling "The Couriers Pledge" -- an initiative which commits its business to setting a new -- "fairer" -- social rights standard for its gigging couriers.

The self-defined "standard" covers earnings, safety, communication and support for development opportunities.

Glovo says the commitments will (eventually) apply to couriers working across its entire market footprint -- whatever their exact employment status.

The delivery platform and dark store operator currently has 74,000 couriers across its market footprint (mostly in Europe and Africa) -- but it says it expects to have 240,000 couriers active on the platform by 2023.

So the pledge looks set to touch a lot of platform workers.

That said, the slated improvements to Glovers' (as it calls gig workers') working conditions will not arrive overnight.

Instead, changes to bring its various regional operations in line with the pledge will be rolled out gradually over the next ~24 months -- to take account of local differences in regulations and operational conditions, per co-founder Sacha Michaud.

Nor will the application of the pledge be precisely uniform; each market will have specifics, reflecting local differences in ops or indeed laws. (He notes, for example, that in some markets it works with third-party contractors who supply couriers -- so it can only ask those other companies to make sure their workers are covered.)

The first of markets where the pledge will be applied happen to sit at the edges of Europe: Georgia and Morocco.

Beyond that, Glovo says it will be figuring out the rollout map as it goes along -- so it's not clear when its home market of Spain might be covered.

But it says its goal is to have its whole fleet of couriers covered by the end of 2023 and just under half (40%) by the end of Q2 2022.

Fairwork is involved, but is it fair work?

Glovo writes that it "collaborated" with Fairwork -- an academic research project which benchmarks gig platforms against a set of fairness principles -- to help it come up with the contents of the pledge, which is comprises four components (see below), aka "pillars" as Glovo calls them.

However, Fairwork told TechCrunch it does not endorse Glovo's pledge as "fully instituting fairness for Glovo workers" -- dubbing it only a "first step toward improving conditions."

So the preliminary external assessment is that Glovo could still do a lot better.

Fairwork will be carrying out regular (possibly quarterly or biannual) audits to assess whether Glovo is living up to the commitments as it rolls the pledge out across its markets.

Glovo has said these reports will be made public.

It also specifies that Fairwork is not being paid by for this oversight work -- in order to preserve its independence.

Going public about wanting to improve and being transparent about whether it actually has is a key part of the strategy here, per Michaud.

"We identified that this is the right thing to do and we're going to commit openly to doing that," he tells TechCrunch. "We need a window to execute on that in the different regions for the complexity of our business from an operations perspective and regulatory and we'll find a way to make it happen in every single country -- and the ones we launch in the future as well."

Glovo co-founder Sacha Michaud speaking at TC Disrupt. Image Credits: TechCrunch

While Michaud is quick to talk up what he argues are the "good things" gig work has done for the world of work -- reeling off familiar talking points like "easy access to income with very low barriers" for people who "maybe might have difficulty to find other types of work or income"; and of course the familiar gig platform claim of "flexibility"; or work that he euphemistically couches as having a "dynamic nature"; and maybe suits people who don't do well with more traditional, rules-based employment -- he accepts that a course correction is needed.

That said, there is no admission that the model itself is intentionally exploitative.

Rather he suggests gig platforms historically miscalculated -- believing they were catering to a specific niche of people who just needed a "few" extra hours' work to supplement their income. But now the reality is a "large number" of Glovo's couriers depend on the platform as their primary -- or even sole -- source of income, he says.

Hence: "We have a certain responsibility as a company to give them more guarantees and more coverage so they can continue working on a certain baseline," as he hedges its goal for the pledge.

Michaud also rejects the idea that increased competition in the on-demand delivery space -- with dark store/"q-commerce" startups busy bubbling up all over Europe, as well as (new) on-demand delivery businesses zeroing in on dedicated niches (like pharmaceuticals or high-end/lux brands) -- is a (retention) motivation for Glovo offering couriers better conditions.

"I think regulatory wise it's going to move in this direction -- that we're doing," he hazards instead, adding: "We see no point in waiting."

Why, then, aren't these conditions Glovo's standard already? "Operationally wise it's complex," is his response on that.

"The dynamics in every market is very different and regulation is very different -- sometimes it's not that easy," he also argues. "It's not a question of choosing which is the best model, generally and pretty much adamantly our couriers have said, very large percentage-wise, that they want flexibility at the same time as having decent earnings and autonomy. And sometimes, depending on the regulation, it's quite complex to manage both those things.

"So that's why the commitment -- and the two year window [to roll it out]."

Mind the fairness gaps

Michaud describes the goal for the pledge as being to plug what he calls "gaps" in the fairness of couriers' working conditions.

Glovo's PR announcement also talks about creating "equality of access to social rights and benefits for couriers, independent of the way couriers work with the platform."

"There's some gaps still," says Michaud in an interview with TechCrunch. "As a company -- and other platforms as well -- I think we need to fill those gaps.

"Our commitment to the pledge is to try and cover the gaps and improve them, and make a commitment that by a certain date -- the end of 2023 -- that any courier on our platform will have certain minimum guarantees or social rights."

Below are the four components Glovo lists in the "Couriers Pledge" -- and how it (top-line) defines them:

FAIR EARNINGS
"Fair earnings per hour should be secured and regular collaboration has to be rewarded."
360° SAFETY
"All couriers must have fully fledged insurances covering any unforeseen situation. Safety on the road has to be a top priority."
PROACTIVE MANAGEMENT
"We will hear and act upon couriers’ needs and issues in a transparent manner following a two-way communication."
CARING FOR COURIERS
"Working as a rider should be a temporary thing. Fostering learning opportunities and keeping an open dialogue is a key goal."

There's a little more detail in the fuller document Glovo also shared -- where, for example, "proactive management" boils down to "Demonstrable Service Level Agreements (SLAs)" being implemented "to guarantee effective communications" between courier and platform staff, and it offers the commitment that: "Any difficult concept or the algorithm logic needs to be explained in a simple and understandable way, so they know how the Glovo platform works."

It also pledges an "easy appealing process" if a courier is disabled from the app.

But there is zero talk of collective bargaining -- something workers in the EU are entitled to as a right.

Michaud bills the initiative as "open" -- hence why, presumably, Glovo isn't branding it "The Glovo Couriers Pledge" -- as he's "hopeful" other delivery platforms will sign up.

Although he adds that it hasn't yet approached any competitors about doing so.

On this, it's worth noting that Uber already came out with its own suggestion for "a new standard for platform work" (as it put it) for Europe back in February -- when it published a whitepaper lobbying the EU to adopt California-style laws that don't disrupt its business model (i.e., by requiring it to pay full employment benefits).

Whether Glovo's pledge has more substance than Uber's whitepaper remains to be seen -- but engaging Fairwork as an auditor is certainly an interesting and laudable step. After all, the group wasted no time blasting Uber's whitepaper as "corporate lobbying masquerading as progressiveism."

Fairwork also accused Uber of trying to “legitimize a lower level of protection for platform workers than most European workers benefit from” -- arguing there's plenty of scope for it to improve conditions for workers within existing laws and further excoriating it for claiming improved conditions are dependent on regulatory change.

So Glovo will need to tread carefully to avoid a similar accusation that it's delaying rolling out better working conditions for portions of its gig workers as a cynical ratchet to try to drive local policy change to align with its business model.

The wider context here is of course that gig platforms have -- even from the get-go -- faced accusations that they are inherently exploitative of labor and seek to erode workers rights.

Critics accusing them of applying a bogus classification of "self-employment" that exploits delivery couriers by extracting the labor of an army of precarious but essential (to the business' function) labor force without providing the benefits and rights of employment.

Platforms typically counter such accusations by arguing that couriers want gigging "flexibility" rather than traditional employment -- and further claiming "outdated" employment laws don't allow them to provide benefits without applying the sort of rigid conditions their workers don't want.

However on that they are counter-accused of a self-serving, selective interpretation of the law; and, therefore, of dragging their feet on offering better conditions. (See Fairwork's aformentioned evisceration of Uber.)

They have also often lost litigation challenging their employment classifications.

In the U.K., for example, Uber lost a long running employment litigation earlier this year, after the Supreme Court ruled that a group of drivers were workers, not self-employed contractors as Uber had tried to argue (for literally years).

While, in Spain -- one of the markets where Glovo operates -- the country's top court rejected its classification of delivery couriers as "autónomos" last year. And lawmakers there have since passed a labor reform specifically targeted at recognizing platform delivery couriers as employees. (Portugal is also reported to be eyeing a similar law.)

Glovo did not responded to the change in Spanish law by instantly employing the circa 10,000 couriers active on its platform in the country. It has said it will be hiring around 1,800 couriers (but Michaud admits it hasn't yet hit that figure).

It has also chosen to make changes to how it operates the platform to try to justify keeping a majority of its local Glovers as "freelance" couriers. (Some of whom may be employed by third-party agencies -- at which point they are essentially being subcontracted to do gig jobs on its platform but which it argues Spain's labor reform allows.)

The net result is that even with a labor law in place that says delivery couriers working on platforms like Glovo are employees, plenty of platform workers in the country are (still) not employed and thereby face a variety of working conditions.

This in turn means Glovo's decision not to prioritize rolling out the pledge to couriers in its home market looks, well, interesting.

Michaud claims Spain's regulations make applying the commitments there more "complex" -- since he argues that most of its local couriers don't want to be employed; and that local employment law on freelancers/self-employed ties its hands on giving additional benefits -- "because it would imply a labor relationship."

"Again, I insist, most of these workers don't want [employment] -- so you're excluding them," is his familiar line of argument.

This suggests Glovo will be directing its efforts in Spain (at least initially), not on improving working conditions for the majority of couriers but pushing for amendments to the labor reform to allow it to (eventually) raise courier benefits (somewhat) -- without having to reclassify them as full-fat employees as the law intends and which would instantly give them … well … far better working conditions.

So it is, to put it politely, rather tautological.

Nonetheless, Michaud summarizes its domestic plan as: "Working with the social agents and finding common ground to get those workers that stay autonomous … the benefits and the guarantees that they need."

He also points to how Glovo is now operating in Italy -- calling it "a good guideline" of what it's hoping to achieve elsewhere via the pledge -- flagging a recent gig economy regulation he says covered a lot of the things that are already in the commitments.

"For example we give guaranteed income per hour there -- but they're freelancers. We begin paying their social security directly -- so they're covered when they're ill. It includes safety, training and obviously material. And obviously it includes further education -- so all the pieces that sometimes are missing. So that's a fairly good reference.

"There we are giving guaranteed income, earnings per hour … It maintains the flexibility, they're autonomous … they have collective voice, they're represented by trade unions."

Still, there are further steps Glovo believes it can make for couriers there too, per Michaud, who adds: "Italy will hopefully be under the pledge early next year."

Toward better gig work across the EU?

European Union lawmakers, meanwhile, have an active eye on conditions in the gig economy across the bloc -- having been nudged to take a public interest by the surge in popularity of delivery platforms during the peak of the COVID-19 pandemic last year.

The Commission has spent the better part of this year consulting on how conditions for gig workers might be improved, initially through platforms making changes themselves -- but also dangling the prospect of pan-EU standards coming down the pipe.

So the EU's executive scoping out potential legislation gives gig platforms a serious incentive to jockey for position -- and try to frame the terms of debate. And, ultimately, pushing their own version of what "fair" standards are on policymakers.

In a speech back in February the EU's digital policy chief, Margrethe Vestager, warned that what she acknowledged can be “poor” and “precarious” working conditions on gig platforms must be "addressed."

But she also talked of wanting to "find a balance between making the most of the opportunities of the platform economy and ensuring that the social rights of people working in it are the same as in the traditional economy." So it's really not clear what the Commission is cooking. (And at the time of writing the EU executive had not responded to a request for an update. Update: A Commission spokeswoman confirmed it will be coming forward with an initiative before the end of this year, and is currently considering responses to the second stage of the consultation as it works on defining the contents of the initiative.)

With the EU's process ongoing, Glovo's pledge is timed to preempt any rules the bloc's lawmakers might draw up -- and which could even end up overruling country-specific labor reforms (potentially rolling back those "complex" regulations that so trouble gig platforms' business interests).

That means Glovo's pledge must be read, at least in part, as a lobbying instrument -- illustrating its strategic red lines.

It is notable, for example, that Glovo's pledge on earnings does not commit to paying couriers for every single hour of working time. Such as when they are logged into the app and waiting for a job to come in; or waiting outside a restaurant for a delivery to be made up and brought out to them; or biking through traffic jams and pouring rain trying to find a customer's address; or waiting outside the customer's address for the person to answer the door. And so on.

Michaud confirms that Glovo continues to pay couriers per delivery.

The pledge as it stands doesn't change that. Rather the suggestion is Glovo will "top-up" courier earnings if they fall below a locally set wage indicator for hourly earnings (it says it's using WageIndictator data to make these calculations), as well as factoring in any additional costs the courier may have to fund to carry out deliveries in that location (e.g., bike repairs, fuel, etc.).

So its definition of "fair" earnings continues to limit how much couriers can earn on its platform by not paying for all their actual working time.

This is a recurring battleground in gig economy litigation. And -- over in the U.K. -- Uber's recent, post-Supreme Court ruling announcement, claiming it would now treat drivers in the country as "workers," did not extend to paying them for all the hours they clock up logged into the Uber app either; instead it said it would be calculating working time from the point a trip commences.

"Today they're only paid per job," confirms Michaud -- referring to the majority of Glovo delivery couriers who the startup does not directly employ, before adding: "We have different types [of employment relationships with couriers] so it's very varied -- that's why we wanted to equal the playing field for everyone to a certain [extent]."

We raised this issue with Glovo's chosen auditor, Fairwork, suggesting that paying by working time would be fairer than paying per delivery -- and they agreed.

"Fairwork advised Glovo on how their pledge could comply with the Fairwork principles. In that process we advised them that workers should be paid for waiting time at the rate of the living wage," researcher Alessio Bertolini told us.

"Fairwork will be auditing and scoring Glovo on that basis. We are pleased that Glovo has consulted with us in this process and has indicated openness to being held accountable to their commitments by Fairwork. However, this does not constitute an endorsement from Fairwork of Glovo's commitments as fully meeting all standards of fairness," he added.

"Workers are actively contributing to platforms’ operations and revenue, and to customers’ ability to receive prompt service, during all the time they are logged in and available to accept jobs. They are giving up personal time, and the freedom to do other activities in other places. They are also often representing the platform, with branded equipment and apparel. For all these reasons, it is Fairwork’s strong position that waiting time is working time and should attract fair pay."

So, well, Glovo may find its first full Fairwork audit a fairly painful read too.

For the record, Michaud dodged the question about paying couriers' working time rather than per delivery when we put it to him -- sidestepping into a tangent on how it measures "earnings per hour" to ensure they reflect a local average based on data from WageIndicator (but that's not what we were asking).

He also segued into talking about Glovo's use of technology to distribute jobs to couriers -- saying it has "stock management systems" in most of the countries where it operates which he said are intended to "optimize" supply and demand in order to make up earnings to that local wage level. (Presumably by sharing out available jobs between couriers to avoid too much of an earnings skew between individuals.)

With the pledge, he says the idea is to plug gaps in this job distribution system -- topping up earnings in instances where couriers aren't sent enough jobs by the platform -- but not plugging the bigger wage gap resulting from Glovo choosing not to pay out their working time.

He mentions a courier he says he met recently in Ghana -- who told him that he'd been working for over two hours and had only had three deliveries, saying that's "not good enough" and that it's "the type of thing we want to address," before adding: "We want to step up … And hopefully other companies will join us in raising the bar."

However Glovo's preference for "raising the bar" on courier earnings remains far below Fairwork's definition of what is actually fair pay -- and, well, what European employment law has long established as fair: A minimum wage per each hour of time worked. So -- for now at least -- it is essentially a familiar gig economy push to try to normalize a lower tier of employment rights for platform workers, who are already among the most vulnerable and precariously placed workers in society.

Whether EU policymakers will be swayed by this deregulatory pitch is the next pressing question.

Michaud confirms he will be presenting the pledge to the Commission and members of the European Parliament this week. (The support of MEPs will be required to pass any EU legislation in this area -- parliamentarians also frequently amend Commission proposals.)

"I think this is the way the gig economy will go, especially in Europe," he suggests, fleshing out the pitch EU lawmakers will hear. "There's a strong case for who the workers are on these platforms -- who generally have low access to 'normal' employment, or certainly at that given time. It's easy access to income; it's very flexible and dynamic. And then again what I think is true if someone is working on a platform and it's the primary source or very important source of their income -- although we will cover everyone, even if they're only working five hours a week they'll still have the necessary coverage -- I think there needs to be better coverage, better social benefits. When they're ill they should have coverage and things like that. Which often are not covered."

Asked for its assessment of the general state of delivery gig worker conditions across Europe, Fairworks' Bertolini said standards are shockingly low -- which may be why some of the bigger (and better resourced) gig platforms, with lashings of VC cash to spend on an in-house team of policy staffers to hone pitches and lobby lawmakers, spy a chance to frame themselves as offering "higher" gig work standards.

"As previous Fairwork reports in Europe, such as Germany and U.K., already have shown, the vast majority of platforms fail to provide even the most basic labour standards that would be considered fair," he went on.

"Some of the main issues include the lack of a minimum wage floor, lack of statutory health and safety protections, lack of access to due process and lack of channels for collective representation. Many of these issues stem from the classification of workers as self-employed or independent contractors in order for platforms to avoid obligations and protections."

"Regardless of employment status, all workers should have the same basic legal rights and social protections," Bertolini added. "If a lower tier of protections for certain classes of workers is institutionalized, we risk seeing a race to the bottom."

He also warned that putting guarantees into law to avoid the misclassification of independent contractors aren't in and of themselves a panacea -- as Spain is perhaps finding out now.

"We believe that guaranteeing that workers are not misclassified as independent contractors is an important part of the solution but it shouldn’t be everything. What we are seeing in many countries is that even platforms that rely on an employment model can use systems of subcontractors to avoid their legal responsibilities.

"Any future EU legislation should take into consideration these issues and make sure that these companies are made responsible for the conditions of the workers on their platform. We believe all workers, however they are classified, should benefit from minimum standards of fairness in their jobs."

Bertolini also said that, given the variety of classifications and rights associated with employment status in different countries, Fairwork's view is it is most important to ensure that all workers are provided with decent labour standards across Fair Pay, Fair Conditions, Fair Contacts, Fair Management and Fair Representation -- regardless of their specific employment classification.

"We do not support any employment classification system that falls short of guaranteeing these standards for all gig workers, such as the example of Prop 22 in California," he added.

So Commission lawmakers look like they're going to have their work cut out to find their sought-for "balance" between precarity and stability. Screwing their courage to the sticking place may be more profitable on this fundamental rights issue.

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