This year 2021, which is already about to end, began with a draft law on the table in Spain that proposed a great change in one of the most growing technological sectors (in Spain and in the world), that of ‘Delivery’ or distribution at home.
This sector, through apps, has not only changed our way of consumption (someone brings us any food, and not just a pizza, at home) but also the work model, with thousands of people working as freelancers and without really being it, while they are controlled by an algorithm (as Amazon does among its delivery drivers in the United States).
The Minister of Labor of the Government of Spain, Yolanda Díaz, decided that this sector should be regulated, which has many employees and had met with unions and employers to establish the bases of a baptized as Ley Rider which was finally approved in the month of May.
Many and many cried out to heaven for the proposals of Díaz. As happened in the past with the regulation of Uber and other similar apps of VTC services, due to the possibility that so much regulation would throw back the arrival of technology companies with new business ideas.
Also some of the riders or distributors protested against the draft of the Law at the beginning of this 2021, claiming that would result in job losses or a lack of options to work only a few hours a day, since the working day is being regulated and is that many are autonomous by choice. Although in the past there had been protests on many occasions due to the situation of exploitation they were experiencing.
In fact, the march of Deliveroo, one of the main companies in the sector at an international level, served to reinforce this discourse, despite the company publicly maintaining the position that they were leaving because they only want markets where they are leaders in the face of the competition and that was not the case in Spain.
With the whole picture there was other positive news for the sector They showed that the situation was not so pessimistic and in fact, from the European Union they announced a few days ago that they want to promote a similar law throughout the territory and to regularize up to more than 4 million self-employed workers. We analyze the situation in the home delivery apps sector today in Spain.
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A growing and attractive market for investment
After the approval of the Rider Law, new news reached the home delivery sector that shows that, despite the regulation, this continues to be a growth sector with a business opportunity. What news? Well for example, Despite Deliveroo’s departure, a new company landed in Spain. Gorillas, which is a German startup that got 1 billion euros of financing to grow in more markets, also in Spain.
In addition, in a year like this 2021, in which Spanish startups have received triple the funding than in all of 2020 and only in the first nine months of the year, Glovo, the Spanish firm in the “Delivery” sector, has also been very attractive for investment.
A month before the approval of the Rider Law and even knowing that this was going to happen, Glovo closed what was the largest financing round in the history of Spain to a startup at least until that moment receiving 450 million euros.
We must not forget that although this market started with many national and global brands (you probably remember La Nevera Roja, which was later bought by Just Eat) with the different purchases that have been made in recent years it is more a war of multinationals looking for their large chunk of millionaire earnings.
Situation for workers
When the Law Rider came, the Ministry of Labor had detected 18,000 workers who exercised their work as false self-employed, something forbidden in our country. Several sentences, even from the Supreme Court, had already ruled it previously since the first sentence in this regard in 2019.
According to calculations presented at the end of 2020, the UGT explained that the delivery companies avoided the salary set by the sectoral agreement. Meanwhile, it was calculated that the 14,000 riders employed by the sector at that time did not exceed 10,800 euros on an annual average. Instead of paying 247 million a year, they were paying 154.8 million to the workers (in addition to the savings in wages, they also saved the payment of taxes that fell on the self-employed worker, which deprived between 50 and 74 million of euros to Social Security).
As we mentioned a few lines above, there are delivery men who prefer to remain self-employed. What do they want, for example, combine other tasks with this one to obtain an extra income. Or that they want freedom, although it was proven that platforms do not offer a working model that does not give real freedom.
Regarding this and also to have to hire fewer people, last summer, the Spanish Glovo suggested that riders stop being “subject to time slots, but will have free choice of day-, whoever sets the prices of the service or that they can subcontract to other workers “and, in this way, justify the non-existence of labor dependencyl, as advised by two law firms.
Just a few days ago and to conclude this year, Just Eat and the unions UGT and CC.OO signed the first agreement of a company of ‘riders’ in Spain. An agreement that both parties qualify as “historic” for the food delivery sector at home and that could lead to an agreement in the sector in the future, as they themselves have said.
The negotiations have lasted a year and a half and will enter into force next January. The delivery men who are hired directly by Just Eat will earn a salary of 15,200 euros gross per year (This company not only has directly contracted deliverymen or others who operate with logistics companies to whom the platform hires the service).