Technology

Glovo (Delivery Hero) fined €79m in Spain

Spain imposes a fine of 79 million euros on Glovo, which is now detained by Delivery Hero. The home delivery company is accused of failing to comply with labor laws, Labor Minister Yolanda Diaz said on Wednesday, September 21, 2022, according to Reuters.

10,600 regular deliveries

In the decision, the labor inspectorate argues that Glovo did not make social security contributions or other payments for various contributions due between 2018 and 2021 because the couriers were not hired under formal contracts. This covert work fine issued against Glovo is reminiscent of the €9.7m Deliveroo has to reimburse Urssaf in France (the British company has appealed the decision).

Spain’s labor ministry said Glovo, which refused to give work contracts to more than 10,600 delivery workers in cities like Barcelona and Valencia, was forced to settle those delivery workers by paying them wages.

Glovo appeals

Glovo said it wants to appeal the decision, which has been described as one-sided. The delivery company claims to have cooperated with inspectors contrary to what Yolanda Diaz said. And Glovo adds that the mentioned facts refer to the period before the change in legislation.

In accordance with an agreement between the government and the social partners, in May 2021, Spain passed a law introducing into the Labor Code a presumption of hire-for-hire for “workers providing paid delivery services through companies performing this task, up to the algorithm that manages the service or work. conditions through a digital platform. The rules went into effect in August of that year. But, Reuters notes, some of those workers say they still haven’t been offered a contract.

Presumption of employment in Europe

Glovo has announced that it wants to pay couriers responsible for delivering groceries, but those delivering food will be offered a different status that strengthens their autonomy. Deliveroo, for its part, has announced that it will withdraw from the country before these rules go into effect. The British delivery company, which has also left Germany, appears to want to take the same approach in the Netherlands, where the justice system keeps a very close eye on the status of deliverers and may opt for a presumption of employment.

Such a change could be imposed on a European scale. The European Commission has submitted a draft directive establishing a presumption of employment for persons working through digital platforms exercising a certain level of control over their activities. But this draft must be adopted by the European Parliament and then incorporated into the national legislation of each Member State.

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