Good money and new slaves? Gig workers take all the risk in COVID-19 boom for food delivery

Courier work is marketed as a well-paying job that allows its workers to have free rein over their work schedule. As long as they have their own mode of transport, a VAT number, a food-handling certificate and work permit, they are qualified for the job as one of the delivery people zipping around the Maltese islands for food ordering services like Bolt and Wolt. They are, thanks to the online system these companies provide, nothing short of taxi drivers for food.

And their expected earnings are enticing, ranging from €6 to €9 an hour. A 3km delivery run would see couriers earning around €3.18 for the trip – if online mapping directions are anything to go by, that is €3.18 earned in just an 8-minute time span at most.

With just two trips in an hour a courier is already making more than an employee on minimum wage.

Indeed, one delivery courier who spoke to MaltaToday about his best days of work, said that he makes an average of €500 a week with food delivery as his full-time job. On “a good day” with around 70 delivery trips and an average €4.75 per trip, he rakes in €332. And that is much more than most workers could hope to make in a day.

The red flags

But while being marketed as a side-hustle option promising independence and cash, the employment conditions for couriers leave much to be desired.

They have no support net for injuries suffered on the job, and their livelihoods rely solely on what the market forces provide. The pandemic may have increased demand for food and grocery deliveries, making courier work a highly sought-after service, but as soon as demand dwindles couriers will have no safety barriers protecting their employment status or earnings.

Their wages are in particular swayed by market forces.

This week Bolt couriers faced a slash in earnings of 20c – largely due to a 65c decrease in the pick-up and delivery fees offset by a 25c increase in their bonus fee. The company also made adjustments to the distance rate calculations.

Currently Bolt couriers aren’t paid for the first 3km travelled, but under the new changes they will be paid 40c for every kilometre travelled from pick-up to delivery.

Sebastian Ripard, CEO of TXF Tech, partners for Bolt in Malta, Cyprus and Tunisia, explained to MaltaToday that this is largely due to the changing market relations. “The reality is that the economic downturn caused by COVID-19 is impacting the whole industry,” he said.

The company landed in hot water this week after two couriers complained publicly on the slash in earnings, saying that they will make as little as €3 per hour with the new rates. Another courier posted an internal email on social media, resulting in a termination of their courier accounts.

The company has since apologised to these couriers and reactivated their accounts. “We recognise that we have handled the situation incorrectly and took some hasty decisions in ending partnership with two couriers. We initially believed that there were violations of terms and conditions and private data,” Ripard said.

GWU secretary-general Joseph Bugeja (second from right) worries that such application workers who lack contracts are simply saving costs for management.

‘New slaves’

But the emergence of Bolt and Wolt in Malta’s food delivery sector denotes a more permanent shift in the labour market towards gig work.

The gig economy was once reserved for home cleaners and care workers who would provide services informally, but this system is no longer a characteristic of the black economy alone, but represents a wider trend in employment.

Bolt and Wolt’s business model is a major shift from the traditional employer/employee model. Ripard acknowledges that while there are some shortcomings to the platform model, there are advantages for all to enjoy.

“The platform model provides flexibility and optimises resources. The individual is free to choose when and where to work, this flexibility gives access to the job market to those that are not able to work a standard 9 to 5 job due to other conflicting responsibilities. This model also creates market place efficiency, meaning savings on administration and management which are reflected in better earnings for service providers and lower costs to customers.”

But Josef Bugeja from the General Workers’ Union worries that so-called “application workers” will become the new labour slaves.

“This is a new world of gig work, where an application serves as a contract of service. The problem is that these workers don’t have employment conditions whatsoever. There is no contract binding them, only an application,” Bugeja said.

“You can hardly call them self-employed – at least when you’re self-employed you can have certain benefits or sick leave through a contract of service,” he added.

A lack of a formal contract appears harmless at first, but things get complicated when you delve into the details.

With the pandemic, food delivery workers put themselves at higher risk with every delivery, but they don’t qualify for paid sick leave in case they fall ill, and instead suffer a major income loss or force themselves to go to work at the expense of others.

Malta’s roads are also unforgiving, and any expenses incurred due to traffic accidents are the courier’s to sort out.

The allure of the gig economy can deliver tasty food conveniently at home but it also relies on shifting risk onto workers.

Workers are promised attractive pay and flexible hours but carry the risks alone. It is a model that may work for some but one that sees companies wash their hands of the risks and in the same breath reap the highest returns.

“Definitely it is not slave work… this is a very harsh term and should not be used light-heartedly” Wolt spokesperson

A Wolt spokesperson refuted the term “slave work”.

“Definitely it is not… this is a very harsh term and should not be used light-heartedly,” the spokesperson said.

“Platform economy is a new way of working that has been introduced relatively recently in most countries. Like most novelties, there are some people that criticise it and many others that support it. A key advantage of the platform economy is the freedom and flexibility that allows individuals to work whenever they want for however long they want.

“For example, it provides additional income to people that have another main job or they’re studying etc. Since the platform economy is so new and different, there are probably improvements that can be made in order to make the model even better and our company is always committed into engaging with all relevant stakeholders for improving the model.

“It is worth noting here, that the biggest majority of Wolt deliveries in Malta, take place via couriers who are employed by third parties. As mentioned previously we are doing our best to design our pricing and payment models in a fair way towards all groups of ‘the triangle’ – our customers, the restaurants and the courier partners.”

Should gig workers be employed in the company?

Legal Notice 44 of 2012 lists a set of criteria concerning legal status of self-employed workers. If the working relationship between the self-employed and the employer fulfil at least five of the eight criteria laid out, it is presumed that that worker is an employee within the company.

 A courier could be eligible for a formal employment contract if they:

•    depend on the employer for at least 75% of their income over a one-year period

•    depend on the employer to determine what work needs to be done and where

•    perform the work using equipment, tools or equipment provided by employer

•    are subject to a minimum work period established by the employer

•    cannot sub-contract his work to others as a substitute for himself

•    are integrated in the structure of the production process, the work organisation or the company’s hierarchy

•    provide a core element in the organisation and pursuit of company objectives

•    carry out similar tasks to existing employees