Uber Looks To Cut European Deal To Avoid Reclassification Of Gig Workers

Pressure over employment rights in Europe has prompted food delivery and rideshare firms like Uber and Deliveroo to open negotiations with unions and labor groups, The Wall Street Journal reported on Wednesday (Dec. 30).

The move is intended to sidestep legislation that would reclassify European gig economy workers as full-fledged employees. Regulators across Europe have been scrutinizing the firms’ position that gig workers are independent contractors.

The gig economy firms are hoping a deal they made in Italy can be worked out elsewhere. A September labor deal with an Italian union guarantees workers an hourly rate of €10 per hour, €3 more than the minimum wage. The deal doesn’t include any paid time off, but would cover workers’ equipment, insurance and collective bargaining.

Uber is in the midst of appealing a U.K. Supreme Court decision that ruled workers using the company’s app are actually employees of the company. In Switzerland, Uber Eats was ordered to stop using independent contractors in the Geneva area. Instead, it is relying on third-party employees.  

The gig platforms maintain that changing workers’ classification would strip drivers of flexibility and lead to job loss in the sector. The Geneva decision, for example, resulted in the loss of 1,000 jobs, as just 300 drivers were awarded contracts.

After winning a state vote in California to avoid reclassifying its drivers, Uber and Lyft offered gig workers a small benefits plan. Gig worker status is still being debated in other states, however, as well as among labor unions. 

Uber and Lyft said that if the vote didn’t pass in California, they might have had to leave the state altogether.

The benefits for California gig workers will be paid for by customers by way of additional fees. Uber is charging a maximum of $1.50 per ride and $2 on meal deliveries. DoorDash, Lyft and Instacart also said they were planning to add fees to cover the cost of workers’ health and accident insurance.