Billionaire Jack Cowin calls for government inquiry into “gig economy” food companies Uber Eats, Foodora and Deliveroo
Tuesday, May 29, 2018/
One of the richest businessmen in Australia is calling on the federal government to launch an investigation into the employment practices of food delivery platforms including Uber Eats, Foodora and Deliveroo.
While numerous small business owners have spoken out about the problems they’ve experienced when using Uber Eats for their business, Jack Cowin says there needs to be an “equalisation” between how gig economy platforms and other businesses pay workers.
Cowin is the owner of Competitive Foods, one of the largest privately held businesses in Australia and home to Hungry Jack’s and KFC outlets. He’s also the chairman of Domino’s Pizza.
Speaking to the ABC this week, Cowin said it’s “unfair” that “gig economy” platforms are not required to pay delivery workers the same rate as companies like Domino’s, and when asked if he thinks there should be a government investigation into wage differences, he said, “yes, I do”.
He argued that there should be standardised pay and conditions across the food delivery sector and if platforms want to hire delivery workers as “contractors”, they should still have to pay them the award rate.
“We have the gig society — where people are contractors who are doing delivery, they don’t get employee benefits, they don’t get penalty rates, they work on a contract rate, which is a lot lower so if someone wants to look at wages, that’s where they should look, that’s where people are being paid less.”
“Why should a company that employs someone have to pay long service leave and all the various employee benefits and things like these, whereas other people have the pseudo sort of philosophy that this is, ‘I’m a contractor’ but they are fulfilling the same function as the employees at our company.”
However, in the interview, Cowin did not reflect on the fact that Domino’s has previously attempted to negotiate for an enterprise agreement, which the Retail and Fast Food Workers Union argued contained conditions that meant it failed the Fair Work Act’s “better off overall” test for workers. That deal was set aside earlier this year, with Domino’s saying at the time its employees would instead remain on the industry award.
Cowin did acknowledge that some Domino’s franchisees do in fact use Uber Eats for their deliveries, but said he doesn’t believe they should stop doing so.
“No, no that’s part of their business — what I’m saying is it should be a level playing field in which everyone, whether you’re a part-time contractor or a part-time employee in a store, that the benefits should be the same,” he said.
Rather than delivery platforms like Uber Eats paying delivery workers more, Cowin said he believes “aggregators” should “have to start providing their ‘contractors’ with added benefits to have a level playing field”.
Scrutiny already gaining momentum
While it’s not clear whether the government would agree to Cowin’s request, scrutiny over the practices of gig economy operators has been growing, in part led by some delivery workers who themselves believe their arrangements should be considered employment relationships and not contractual ones.
“There is definitely a momentum for future scrutiny on these practices,” Dr Alex Veen, a scholarly teaching fellow at the University of Sydney Business School, previously told SmartCompany.
“If you look at recent developments, the Senate’s inquiry into the future of work is underway. From a regulator’s point of view, that Senate inquiry is going to be shining some lights,” he says.
But Veen said there could also be regulatory changes that could go well beyond sham contracting arrangements and how gig economy workers get paid.
“One of the things we have identified in our research is occupational health and safety in these businesses. Whether or not many of these platforms are required to pay workers’ compensation is a grey area. There are risks with how some of these platforms, not all but some, operate — and if these workers are injured at work, it’s the public that could end up footing the bill.”
Given that scrutiny is building, many are questioning what the balance should be between “flexibility” and entitlements, says Dr Josh Healy, senior research fellow at the University of Melbourne’s Centre for Workplace Leadership.
“For many people, it’s not clear in principle why these workers shouldn’t have access to customary, minimum standards,” he tells SmartCompany.
“It really seems as though there is a build-up of interest here, and there is concern from the other side too, from within companies about what they might be exposing themselves to [with their agreements].”
SmartCompany contacted Uber Eats, Foodora and Deliveroo but did not receive a response prior to publication.
From the frontlines
A leaf out of Israel's book: Australia needs to step up, or risk falling further behind Anthony Aarons Epifini co-founder
'Few are destined to be unicorns': When is the right time to sell your startup? Peter Forbes HROnboard founder
CX versus UX: What's the difference, and why does it matter? Tom Uhlhorn Tiny CX founder
How augmented reality can motivate and assist employees to develop their skills Alexander Roche Androgogic founder
Forget gender quotas: It's time to review your definition of diversity Inga Latham SiteMinder chief product officer
How to assemble a board of directors that will make, not break, your startup Mark Rohald Cluey Learning co-founder