Just Eat Rethinks Gig Worker Model and Cuts 1,700 Jobs

Delivery giant Just Eat Takeaway is reportedly cutting 1,700 driver jobs in the U.K.

Those jobs will be replaced by gig workers, per published reports Tuesday (March 21), a U-turn for a company whose CEO had in the past criticized the gig economy model coming as the industry faces increased pressure.

“Just Eat UK is reorganizing and simplifying its delivery operation as part of the ongoing goal of improving efficiency,” the company said. “As part of this process we have proposed to transition away from the worker model for couriers.”

PYMNTS has reached out to Just Eat for comment but has not yet received a reply.

The move marks a change in strategy for Just Eat, which had tried to differentiate itself from competitors in Great Britain by not hiring gig workers.

“The gig economy comes at the expense of society and workers themselves,” Just Eat CEO Jitse Groen wrote in a 2021 Financial Times piece, arguing the gig economy “has led to precarious working conditions across Europe, the worst seen in a hundred years.”

(A report by Reuters notes that the company does employ gig workers in Ireland and Slovenia while using employed couriers elsewhere in Europe.)

The news comes a little more than a week after the CEO of Just Eat subsidiary Grubhub announced his resignation. Adam DeWitt will leave his job at the beginning of May. Howard Migdal, CEO of Just Eat’s Canadian aggregator SkipTheDishes, is set to become GrubHub’s new chief executive.

Just Eat has been trying to find a buyer for Grubhub, PYMNTS wrote, “having faced challenges making the economics of the business work.”

As noted here at the time, DeWitt’s departure was another sign of the ongoing turmoil in the on-demand delivery space.

In addition to Just Eat’s job cuts, another U.K.-based firm, Deliveroo, announced in February it was cutting 9% of its workforce, or 300 to 350 jobs.

Company CEO Will Shu said at the time that it had grown its headcount rapidly during the pandemic, but now faced “serious and unforeseen economic headwinds.”

Plaguing the industry is the fact that increased economic pressure means that delivery is a luxury many consumers can longer afford. According to the PYMNTS’ Connected Dining study, “Connected Dining: Rising Costs Push Consumers Toward Pickup,” nearly half of all consumers (48%) have been more likely to pick up their restaurant orders themselves rather than have them delivered, because of inflation.

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