Deliveroo announced plans to withdraw from Spain just a few months after the government promised to enact laws Greater employment rights for gig economy workers.
Deliveroo’s headquarters and Listed in LondonSaid that considering the scale of its business in Spain, compared with other markets, staying in Spain requires too much investment.
The food delivery app company blames it on its relatively small market share, saying it “achieves and maintains its top market position in China” Spain It will require a disproportionate investment, and the long-term potential return is highly uncertain, which may affect the economic viability of the company’s market.”
spokesman takeout Said that Spain’s employment rights law was not the deciding factor, but added that it led to an early exit from the country.
As the first European Union country to do so, the Spanish government announced a landmark legal ruling in March to legislate to give workers in food delivery companies and other online platforms more employment rights.
Known as “Riding“These changes mean that workers are assumed to be employees rather than self-employed contractors. These changes will also force food digital platforms to inform deliverymen how computer algorithms and artificial intelligence affect their working conditions.
Deliveroo stated that starting in September, its withdrawal from Spain will require a one-month negotiation with affected employees, and its service in the country ceased in October.
The company said that the move will not have a major financial impact, and its total sales in Spain are less than 2% of its total sales. Deliveroo operates in 12 markets, Including Australia, Belgium, France, Hong Kong and Italy, but the United Kingdom and Ireland account for half of its income.
Although the company did not explicitly mention changes in the Madrid government when it announced the move on Friday, Spain’s reforms are seen as a direct challenge to the business models of companies such as Deliveroo, which rely on assigning deliveries to work Workers. Is classified as an independent contractor.
Deliveroo said that this provides workers with ideal flexibility, but some workers are already fighting for rights such as sick pay and holidays.
In the UK, Deliveroo workers are still considered contractors. In June, the company Successfully debated in the Court of Appeal Workers are self-employed, which frustrates unions seeking to improve the economic conditions of gig jobs. However, the Supreme Court of the United Kingdom has previously found that Uber employees should be considered employees.
The Big City Investment Fund considers the status of workers to be a special issue, and some major investors say this is the key reason not to buy stocks Deliveroo stock’s IPO was disappointing March. An investor told the Guardian that labor issues are a “time bomb” for the company.
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When the plan to withdraw from Spain was introduced, Deliveroo faced fierce competition from competitors, including Uber Eats, owned by Uber, an American taxi app company, Just Eat Takeaway in the UK and the Netherlands, and Spanish rival Glovo.
Glovo has stated that it plans to permanently hire 2,000 delivery workers, but will still work hard to retain some independent workers. Uber Eats is outsourcing its passenger services to other companies.
Hadi Moussa, Deliveroo’s International Chief Commercial Officer, said: “The decision to propose to terminate our business in Spain was not taken lightly. He thanked the drivers and said that he would support employees throughout the consultation period.
