Rapid grocery firms to put riders back on zero-hour contracts

Rapid grocery delivery firms are preparing to move hundreds of couriers to insecure gig-economy contracts as the threat of tougher regulations has receded, stated a recent report citing industry sources.

According to the The Guardian, some on-demand grocery businesses, which are firms that aim to deliver groceries within 15 minutes, are understood to be considering terminating the contracts of couriers entitled to minimum hourly rates and paid holiday and are considering to offer them self-employed contracts, where they will be paid per drop-off.

Ministers have failed to bring in a modern employment bill with protections for gig-economy workers, despite promising to introduce new legislation at least 20 times since reforms were first mentioned in the Queen’s speech in 2019.

Experts claim that industry executives no longer feared tougher employment laws, which would have forced them to take on drivers as workers rather than independent contractors.

“One of the largest firms in the sector is planning to move back into the gig economy because it is cheaper to pay people a fixed price for each delivery than by the hour,” Quick-commerce consultant Quaid Combstock, who once headed delivery operations for the former on-demand grocer Jiffy, told The Guardian.

“It’s all about cost savings. The industry opinion is that the government is not going to intervene, so why not go for the cheaper option.”

He said the company had already stopped offering contracts with guaranteed hourly rates. “Their next move will be to terminate existing contracts and offer people gig contracts if they wish to apply. I understand it will be some time in the very near future … in the next two to three months.”

The Observer also reported that some of the on-demand firms have confirmed that they were re-evaluating worker contracts.

These warnings come after Just Eat, which has expanded into the on-demand grocery market, announced last month it was laying off 1,700 workers in the UK and reverting to a gig-economy model. The takeaway company made the move despite its chief executive, Jitse Groen, claiming two years ago that gig work had led to the most precarious working conditions in Europe for 100 years.