tag:theconversation.com,2011:/ca/topics/uber-eats-79055/articlesUber Eats – The Conversation2023-10-01T09:57:46Ztag:theconversation.com,2011:article/2145092023-10-01T09:57:46Z2023-10-01T09:57:46ZTrade unions and the new economy: 3 African case studies show how workers are recasting their power in the digital age<p>From US <a href="https://www.reuters.com/world/us/biden-trump-woo-union-workers-michigan-auto-strikes-grow-2023-09-26/">car factories</a> to public sector workers <a href="https://www.aljazeera.com/news/2023/9/5/nigerian-unions-strike-again-to-protest-soaring-costs-after-subsidy-removal">in Nigeria</a> and <a href="https://ewn.co.za/2023/09/08/city-of-tshwane-samwu-strike-a-deliberate-effort-to-turn-the-city-into-a-dumpsite">South Africa</a>, strikes by trade unions continue unabated among the established sectors of the working class. In Detroit in the US, workers are resisting contract employment. In Nigeria they are angry over the rising cost of living and in South Africa, municipal workers are striking for better wages.</p>
<p>But it’s becoming increasingly difficult to build sustainable worker organisations as companies employ more people on a casual basis in the digital age. Work has become more precarious and workers are easily replaceable. </p>
<p>In our <a href="https://witspress.co.za/page/detail/Recasting-Workers%EF%BF%BD-Power/?k=9781776148820">new book</a>, Recasting Workers’ Power: Work and Inequality in the Shadow of the Digital Age, we focus on workers’ power. The classic example of workers’ power is the strike: the collective withdrawal of labour to force an employer to do what they would otherwise not have done. </p>
<p>In this book we challenge the dominant narrative that new technology has destroyed workers’ power. We focus on the new jobs that are being created – food couriers, e-hailing drivers, street traders and the growing numbers of casual workers at the core of the economy.</p>
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<p>We show how these precarious workers are organising in new ways that go beyond the traditional methods of union formation. For example, they are forming coalitions with other organisations, such as NGOs. In some cases they are combining these new approaches with traditional ways of bringing workers’ collective power to bear, for example by making use of laws that support workers’ rights.</p>
<h2>Three case studies</h2>
<p>We focus on three sectors: factory workers in Ekurhuleni, east of Johannesburg in South Africa; food couriers in Johannesburg; and transport workers in Kampala, Uganda. </p>
<p>We examined their ways of organising by applying, in addition to the strike weapon, the lens of three other ways of exercising power: associational power (collective organisation), coalitions (societal power) and institutional power (laws that entrench labour rights). </p>
<p>We found the factory workers were using a range of tools – old and new – to organise. Factory committees were formed at some workplaces. This involved working with a labour supportive NGO. But they also drew on old practices (institutional power) by taking up cases through the <a href="https://www.ccma.org.za/">Commission for Conciliation, Mediation and Arbitration</a> and the amended <a href="https://www.gov.za/documents/labour-relations-act">Labour Relations Act</a>. Both offer the possibility of workers being able to get permanent jobs in the company at which they work.</p>
<p>The food carriers were using different tactics. In Johannesburg they had created worker-driven messaging apps and chat groups where they shared information, developed a shared identity and announced local direct action. </p>
<p>Being self-employed weakens their organising power. But the potential for collective power was increased when they met face-to-face at work zones and began to form a collective identity. Some have engaged in collective action, but with limited impact to date. </p>
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<p>They achieved some success when they worked with a supportive NGO (an international organisation) to put forward demands to regulate their work.</p>
<p>In Kampala, we found that the Amalgamated Transport and General Workers’ Union was also using new approaches to organise workers. In the 1980s the union faced a near collapse of membership when privatisation undermined the public transport sector. This eliminated the position of the traditional public transport bus driver. Informal mini-taxi drivers and motorcycle taxi riders (known locally as boda boda) became the dominant mode of transport.</p>
<p>By classifying the growing number of boda boda riders as workers and therefore potential union members, the union expanded from a declining 5,000 members to over 100,000. In spite of the fragmented and isolated nature of their work these new workers were already organised – not into a trade union but into informal associations. </p>
<p>These associations formed an alliance with the established union. By doing this they gained concrete support from the International Transport Federation, a global union of transport workers. This led to the dramatic growth of the union, a decline in police harassment and growing recognition as a collective bargaining partner.</p>
<p>Importantly, where trade unions have taken up the issues of informal workers, unions have also undergone fundamental changes. They often become “hybrid” organisations, blurring the distinction between traditional unionism, informal workers’ associations and cooperatives.</p>
<h2>What next?</h2>
<p>Our <a href="https://bristoluniversitypress.co.uk/recasting-labours-power">research</a> clearly articulates the challenges workers face. But it also suggests some grounds for optimism in the new and hybrid forms of organisation and the coalitions that are emerging. </p>
<p>The question raised by these findings is whether these embryonic forms of worker organisation are sustainable. Could they become the foundations for a new cycle of worker solidarity and union growth?</p>
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<p>We conclude that this is possible if they innovate and experiment with new forms of association, use digital tools, and broaden unions’ reach through coalition-building with other civil society organisations. In sum, we are suggesting that workers’ power is being recast as precarious workers in Africa experiment with new ways of organising in the digital age.</p><img src="https://counter.theconversation.com/content/214509/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Edward Webster receives funding from organisation.Friedrich Ebert Stiftung. I am a Distinguished Research Professor at the Southern Centre of Inequality Studies at the University of the Witwatersrand </span></em></p>Workers’ power is being recast as precarious workers in Africa experiment with new ways of organising in the digital ageEdward Webster, Distinguished Reserach Professor, Southern Centre for Inequality Studies, University of the WitwatersrandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2125412023-08-30T12:33:58Z2023-08-30T12:33:58ZGig economy workers set for new protections in Albanese government’s legislation introduced next week<figure><img src="https://images.theconversation.com/files/545462/original/file-20230830-27-ro8iwb.jpg?ixlib=rb-1.1.0&rect=20%2C10%2C3366%2C1990&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>A suite of protections for gig workers will be contained in legislation to be introduced into parliament by Workplace Relations Minister Tony Burke next week.</p>
<p>The government argues the changes balance protections with work flexibility. The new regime will begin from July 1. </p>
<p>The legislation, called the Closing Loopholes Bill, will also include measures on rights for casual workers, stopping wage theft, and preventing companies with enterprise agreements using labour hire to undercut wages. </p>
<p>Business has been campaigning strongly against the new round of industrial relations legislation. </p>
<p>Under the changes, the Fair Work Commission will set minimum standards for “employee-like workers” in the gig economy. These are people who work through a digital labour platform, notably in food delivery, ride share and the care economy. </p>
<p>Businesses will be able to apply to the commission for minimum standards orders tailored to the work performed under them.</p>
<p>The terms the commission will be able to consider for an order include payment, record keeping and insurance. But it would not set minimum standards on overtime rates, rostering, or terms that would change how a worker is engaged. </p>
<p>These workers will also be protected from being unfairly removed from digital labour platforms, and they will be able to ask the commission to resolve disputes. </p>
<p>The government says the changes will allow the commission to respond flexibly to these new, quickly evolving business models.</p>
<p>It stresses they will not affect independent contractors, such as skilled tradespeople, who have a high-degree of autonomy over their work.
Rather, they are aimed at protecting workers who are neither “employees” nor small businesses.</p>
<p>Gig workers are estimated to number in the hundreds of thousands. </p>
<p>Burke said at least 13 gig workers have died on the roads in the last few years..
“We know there is a direct link between low rate of pay and safety: it leads to a situation where workers take risks so they can get more work because they’re struggling to make ends meet,” he said.</p>
<p>“We can’t continue to have a situation where the 21st century technology of the gig platforms comes with 19th century conditions.</p>
<p>"At the moment if you’re classed as an employee you have a whole lot of rights such as sick leave, annual leave and minimum rates of pay. If not, all those rights fall off a cliff. What we want to do is turn the cliff into a ramp.</p>
<p>"We’re not trying to turn people into employees when they don’t want to be employees. But just because someone is working in the gig economy shouldn’t mean that they end up being paid less than they would if they’d been an employee.”</p><img src="https://counter.theconversation.com/content/212541/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>A suite of protections for gig workers will be contained in legislation to be introduced into parliament next week, and will also include measures on rights for casual workers and stopping wage theftMichelle Grattan, Professorial Fellow, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2016952023-05-04T16:13:05Z2023-05-04T16:13:05Z‘I’m always delivering food while hungry’: how undocumented migrants find work as substitute couriers in the UK<p>Luca* had not been working long as an online food courier when we met him on a cold winter’s day in a square in the city centre. This was where many food couriers waited for orders to “drop” into their mobile phones.</p>
<p>The 42-year-old husband and father of one was a recently arrived migrant but <a href="https://www.jcwi.org.uk/who-are-the-uks-undocumented-population">not qualified to work in the UK</a>. Luca spoke little English, rented a room with three other people, and earned some money by informally renting food delivery accounts from other couriers as a “substitute” rider. He said this was his first chance of regular paid work since arriving in the UK, adding:</p>
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<p>In this square, I could point you to who is renting an account from other people because they cannot register using their own details.</p>
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<p>Opportunities to rent someone else’s official account can arise through word of mouth, family members, social media and other community websites. Mario, another undocumented migrant in his late 20s, explained that he would constantly browse different social media platforms to identify new courier accounts to rent, in case his existing ones suddenly became inoperable:</p>
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<p>The way I started working was to search on Facebook for ads offering accounts – it’s pretty impressive how these people have all this set up. They asked me if I needed a bike, gear and helmet for an extra fee.</p>
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<p>Our <a href="https://onlinelibrary.wiley.com/doi/full/10.1111/irel.12320">research</a> into food couriers in one English city highlights the daily challenges facing undocumented migrant workers in this sector. Despite past <a href="https://www.thetimes.co.uk/article/deliveroo-and-uber-eats-takeaway-riders-rent-jobs-to-illegal-immigrants-ml36gvp93">news reports</a> highlighting this issue, it was not hard to find and talk to such people about their experiences.</p>
<p>During 2021 and 2022, we got to know seven undocumented migrants who worked as food delivery riders by renting accounts from other riders. We also interviewed 25 documented account holders, of whom three rented their accounts to undocumented couriers for anything from a few hours to weeks at a time.</p>
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<p><strong><em>This article is part of Conversation Insights</em></strong>
<br><em>The Insights team generates <a href="https://theconversation.com/uk/topics/insights-series-71218">long-form journalism</a> derived from interdisciplinary research. The team is working with academics from different backgrounds who have been engaged in projects aimed at tackling societal and scientific challenges.</em></p>
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<p>This is by no means a representative sample – undocumented riders represent a tiny fraction of the UK’s rapidly expanding food courier population. But their experiences are important to understand. Often desperate to secure waged work but with no options for lawful employment, they are willing to accept pay standards well below the UK’s <a href="https://www.gov.uk/national-minimum-wage-rates">national minimum wage</a> and put up with stressful working conditions.</p>
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<p>The undocumented couriers we spoke to typically said they struggled to make enough money to pay off their debts and support their families, despite often working seven days a week. Mario, who was single and lived with friends, linked his long hours and the physical nature of his work with sustaining various injuries as well as mental stress:</p>
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<p>I can take some money home but at very high costs: long hours on the bike, aching knees and joints, back problems from carrying the thermal bag – [and then] dealing with the account broker … They are such a pain, and you are always like: “Yes, sir.”</p>
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<p>Some couriers also described receiving abuse from other riders on social media – for example, in response to their posts looking for accounts to rent. The documented couriers regard this activity as harming their prospects of securing decent pay and working hours.</p>
<h2>‘A choice between eating or getting documents’</h2>
<p>The undocumented couriers we interviewed were aged between 20 and 40, and possessed little or no English. They had arrived from different parts of the world, incurring loans and other debts to enter the UK – which were then added to by the need to buy or rent the bicycles, helmets, thermal bags and other gear to start working as a food delivery rider.</p>
<p>Edu, who was in his mid-30s, told us that before making any money for himself or his family back home, he first had to put money aside to pay off the debts he had incurred to get to the UK. He had arrived with a tourist visa nearly a year earlier, helped by an “agency” back in his home country. He said:</p>
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<p>I earn money for me and my family, but first and foremost to pay off any debt … I work every day to try to earn as much as possible. Money is tight, but somehow I am managing.</p>
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<p>Poignantly, he told us that he often goes short of food himself while working as a delivery rider:</p>
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<p>I’m always delivering food while hungry … I will only bring my family [to the UK] when I’m debt-free and I get my documents – but this day may never come. Until then, I work and work and work.</p>
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<p>Edu said he relied on other couriers to rent him food delivery account details for a weekly fee that was deducted directly from his wages. Social media and chat groups are ripe with posts offering accounts for rent. Typically, they ask for weekly fees of between £55 and £100.</p>
<p>Edu no longer had his tourist visa and was in the process of securing approval for his right-to-work documentation when we spoke. This presented a daily dilemma for him:</p>
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<p>I am dealing with the paperwork and on the phone trying to sort things out, or I am out on the bike trying to earn some money. It’s a choice between eating or getting the [legal] documents.</p>
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<p>On average, our undocumented interviewees earned between £900 and £1,500 a month, after deducting their account and gear rental costs. Working weeks of 80 to 115 hours were common, meaning that they earned well below the UK’s <a href="https://www.gov.uk/national-minimum-wage-rates">national minimum wage</a> (at the time of our interviews, £9.50 per hour for workers aged 23 and over).</p>
<p>The insecure and informal nature of this work results in hyper-precarious lives. The prohibitive costs of city accommodation in the UK, for example, are often minimised by renting rooms with other migrants. Interviewees described sharing a single bedroom with up to three other people.</p>
<p>Body aches and extreme fatigue were part of life for Edu as he tried to overcome the low pay by working long hours every day:</p>
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<p>The way I see it is, on weekdays I work to pay off my debts from back home, plus the bike and account rental. Weekends, when I work the most hours, are for me and my family … On Fridays and weekends, I sometimes work over 15 hours each day to compensate for the little money I take home during the week.</p>
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<h2>‘Easy to cut through the red tape’</h2>
<p>The UK online food ordering and delivery industry is currently valued at <a href="https://www.ibisworld.com/united-kingdom/market-size/online-food-ordering-delivery-platforms/">£2.75 billion</a>, having grown almost 30% each year since 2018. The number of public users of these food delivery services is currently put at 12.7 million – equating to almost one in four UK adults.</p>
<p>Riders who deliver for online food platforms are self-employed, with flexibility a key selling-point for these <a href="https://theconversation.com/ken-loachs-new-film-on-the-gig-economy-tells-exactly-the-same-story-as-our-research-125743">“gig economy” jobs</a>. This includes the ability to ask a substitute to deliver on the rider’s behalf if he or she is unavailable. But our research confirms that some people, usually couriers themselves, use the substitution rule to rent out multiple accounts in different food delivery apps to supplement their income. As Anthony, a 30-something “courier-broker”, observed:</p>
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<p>I know that some [account holders] run real businesses here by renting multiple accounts, gear, the lot … This means that the demand [for accounts] is there … but it also tells you how easy it is to cut through the red tape.</p>
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<p>The online food platforms all have strict regulations regarding who is allowed to work as a delivery courier. For example, both <a href="https://riders.deliveroo.co.uk/en/support/new-riders/what-documents-do-i-need">Deliveroo</a> and <a href="https://www.uber.com/gb/en/deliver/">Uber Eats</a> – two of the <a href="https://medium.com/edison-discovers/in-uk-food-delivery-battleground-just-eat-takes-1-spot-with-45-market-share-e81f79f7133b">UK’s largest food delivery companies</a> – make clear on their websites that all couriers must be able to prove their right to work in the UK, including as a <a href="https://riders.deliveroo.co.uk/en/substitution">substitute</a> <a href="https://www.uber.com/gb/en/deliver/basics/before-you-start/staying-safe-with-the-uber-app/#substitute">rider</a>. When approached for comment about the issues raised in this article, both companies stressed that this policy is strictly enforced at all times.</p>
<p>However, responsibility for checking that substitute riders are qualified to work ultimately lies with the account holders themselves, and our research found multiple examples of undocumented migrant workers, as well as other documented but ineligible or banned riders, working informally as substitute couriers.</p>
<p>Sam, another courier who was renting out his accounts, told us he was “constantly looking out for potential new rentals” (individuals who are looking to rent accounts), but that “where I dedicate more time is in setting up new accounts”. These may come via friends and family members who are willing to register new accounts on multiple platforms for him, so he can rent them out to other couriers.</p>
<p>Sam, in his late 30s, had been renting out accounts to both documented and undocumented workers for three years, charging a weekly fee of £70. He added:</p>
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<p>It’s not like I’m expecting to get rich from this. But it gives me some pocket money to be more comfortable.</p>
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<p>One of the documented couriers we met during an earlier round of interviews also worked for a union that supports food couriers. Mark, who was in his mid-20s, said it was increasingly common to see undocumented couriers engaging in food delivery because platform companies were “pretty much passing the legal responsibility and costs on to the rider who is renting out the account”.</p>
<p>If you are a legitimate account holder, Mark explained:</p>
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<p>You’re supposed to do a criminal record, right-to-work check on whoever you’re handing the account to. But we all know that is not going to happen because it’s too much hassle.</p>
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<p>As well as the initial checks, couriers then receive regular prompts to submit a <a href="https://riders.deliveroo.co.uk/en/news/facial-verification">selfie</a> through the account app to verify their identity. Sam explained how he gets round this identity-checking system when renting the account to an undocumented or disqualified rider:</p>
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<p>If you’re using the account and the photo [prompt] comes up, you can message me, and I will log in [to the app] and take a selfie … I just need to verify my identity this way. Then you log back in, and that’s it.</p>
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<p>Deliveroo stressed that it operates a zero-tolerance policy towards riders who fail to meet their obligations when they appoint another person to complete orders. It added that it conducts regular sweeps of its riders to search for any indication of suspicious or illegal activity, and is rolling out new identity verification technology to further strengthen its system of ID checks. A spokesperson said:</p>
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<p>Deliveroo riders are self-employed and those who work with us must have the right to work in the UK. Riders have these checks completed before signing up with Deliveroo, and riders who engage substitutes – for example lending accounts to friends or family to do deliveries – are contractually responsible for doing the same. Should a rider subcontract to an individual without right-to-work status, Deliveroo would end their contract immediately. These obligations are clearly and consistently communicated to all riders.</p>
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<p>Uber Eats stated that it takes immediate steps to deactivate an account if any breach is found to have taken place, and that it carries out regular identity verification on account holders to ensure that the owner retains control of their account. A spokesperson said:</p>
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<p>All couriers who use the Uber Eats app are required to pass a criminal background check, be over the age of 18, and hold a valid right to work in the UK. Any courier that fails to meet these criteria will have their access to the app removed.</p>
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<h2>Living ‘in constant anxiety’</h2>
<p>The nature of food courier work, with pay per delivery and high workforce competition, means the riders – whether using bicycles, ebikes or mopeds – can be exposed to <a href="https://www.ucl.ac.uk/news/2022/nov/road-collisions-more-likely-takeaway-delivery-riders-working-gig-economy">health hazards and safety risks</a>, in some cases resulting in <a href="https://journals.sagepub.com/doi/10.1177/0950017020969593">serious injury</a>.</p>
<p>As well as accidents with cars and road rage incidents with drivers, our interviewees also highlighted the dangers from “cutting corners” – for example, running red lights and riding on pavements. However, both Deliveroo and Uber Eats stressed that they do not have strict delivery deadlines, and that riders are encouraged to adhere to the rules of the road at all times.</p>
<p>While some food platform companies, including both <a href="https://riders.deliveroo.co.uk/en/support/insurance/what-is-covered-by-deliveroo-insurance">Deliveroo</a> and <a href="https://www.uber.com/gb/en/drive/insurance/">Uber Eats</a>, offer their riders insurance while delivering, many documented couriers feel the need to buy more comprehensive coverage.</p>
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Read more:
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<p>But this option is not available to undocumented riders. Accidents can make them “visible”, jeopardising both their immediate ability to work and any future prospect of securing legitimate right-to-work status. This may lead them to avoid seeking treatment if an injury is sustained, instead continuing to work and thereby risking doing further damage to their physical and mental health.</p>
<p>Undocumented riders must also deal with the constant stress of being “shopped” for their lack of qualifications, or of losing their income stream if an account owner suddenly stops renting it to them or the food platform shuts it down. As a result, these riders usually access accounts from multiple sources to protect their income stream – including renting from family members or tight networks they may have built up before arriving in the UK.</p>
<p>Mario talked of living “in constant anxiety” about suddenly finding he cannot access his rented account:</p>
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<p>I get so distressed because then I have to spend hours looking for a new [account], which obviously means I’m not making any money … It can be that the account expired, or simply that the broker rented to someone else who’s willing to pay more money.</p>
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<p>Another hurdle can be how undocumented migrants receive their wages, since all payments go to the account holder in the first place. Money exchanges rely on a high degree of trust, as Sam explained:</p>
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<p>All details associated with the account are mine, apart from the mobile number. I just transfer the money but keep the [account rental] fee. They can cash out daily or weekly.</p>
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<p>Deliveroo highlighted that it carries out “systemic bank account checks” to verify the account holder is also the owner of the bank account.</p>
<p>Our interviewees told us that the account brokering system can, in some cases, lead to abusive and coercive behaviour towards undocumented couriers. Some described working in a perpetually hostile environment amid the twin threats of not being paid and of being exposed for their undocumented activity. We also saw numerous social media posts and chat rooms in which documented food couriers threatened to expose undocumented couriers.</p>
<p>A spokesperson for Deliveroo stressed that all forms of harassment or discriminatory behaviour are completely unacceptable, and that specific harassment claims are immediately investigated.</p>
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<img alt="Food couriers outside a McDonald's restaurant" src="https://images.theconversation.com/files/523807/original/file-20230502-3336-l8bw6m.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/523807/original/file-20230502-3336-l8bw6m.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/523807/original/file-20230502-3336-l8bw6m.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/523807/original/file-20230502-3336-l8bw6m.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/523807/original/file-20230502-3336-l8bw6m.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/523807/original/file-20230502-3336-l8bw6m.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/523807/original/file-20230502-3336-l8bw6m.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Undocumented couriers interviewed for this study worked long hours for well below the national minimum wage.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/leicester-united-kingdom-september-4-2021-2053381370">SMC Photo/Shutterstock</a></span>
</figcaption>
</figure>
<h2>Informal work across the UK</h2>
<p>The number of undocumented couriers working in app-based food delivery throughout the UK is unclear. But <a href="https://www.accaglobal.com/content/dam/ACCA_Global/Technical/Future/pi-shadow-economy.pdf">studies</a> <a href="https://labordoc.ilo.org/discovery/fulldisplay/alma994951689602676/41ILO_INST:41ILO_V1">show</a> there has been a recent increase in informal work and employment practices in many UK sectors. Since 2016, businesses using undocumented workers – those without residence status or visas – are estimated to have generated between <a href="https://www.accountancydaily.co/acca-estimates-shadow-economy-value-ps223bn">10% and 12%</a> of the UK’s annual Gross Domestic Product (GDP).</p>
<p>We know from our <a href="https://www.ntu.ac.uk/__data/assets/pdf_file/0034/1782295/WIP_GLAA_RCWS-Report-CAN-HAND-CAR-WASHES-BE-IMPROVED.pdf">wider research</a> that undocumented workers are a growing presence in a number of UK sectors. For example, at hand car washes, undocumented labour from Albania, sub-Saharan Africa, Iraq, and Kurdistan now competes with documented workers from eastern Europe. This has pushed day wage rates down to subsistence levels, with workers in some cases forgoing wages in favour of food and shelter.</p>
<p>In cash-only nail bars, a sector that has witnessed exponential growth in England and Wales, <a href="https://www.antislaverycommissioner.co.uk/media/1160/combating-modern-slavery-experienced-by-vietnamese-nationals-en-route-to-and-within-the-uk.pdf">most workers are inappropriately documented</a>. For example, they may be students who have remained in the UK beyond the terms of their student visa, or undocumented migrants who have entered the UK with the help of a “travel courier” – more commonly referred to as a trafficker. If you look in a nail bar you will typically see generous staff levels, but there are few, if any, adverts for technician jobs.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/its-like-youre-a-criminal-but-i-am-not-a-criminal-first-hand-accounts-of-the-trauma-of-being-stuck-in-the-uk-asylum-system-202276">'It’s like you’re a criminal, but I am not a criminal.' First-hand accounts of the trauma of being stuck in the UK asylum system</a>
</strong>
</em>
</p>
<hr>
<p>Both cash-only nail bars and hand car washes frequently fail to comply with regulations regarding health and safety and planning permission. Because they are unregulated, the status of those engaged (workers, contractors, or employees) is invisible to enforcement agencies, which <a href="https://onlinelibrary.wiley.com/doi/10.1111/bjir.12286">our research</a> found are typically more interested in patterns of ownership, the potential for money laundering, and migrant dissemination than labour rights.</p>
<p>In contrast, online food platform companies such as Deliveroo and Uber Eats abide by all UK laws and regulations. But our research supports <a href="https://www.thetimes.co.uk/article/deliveroo-and-uber-eats-takeaway-riders-rent-jobs-to-illegal-immigrants-ml36gvp93">previous reports</a> that have shown the sector’s rider substitutes system is being misused by some account holders, putting undocumented migrants who take advantage of this system at risk of harm and abuse. We believe stronger oversight on the part of the UK authorities is needed, if informal working in the food delivery sector is not to grow further and put more vulnerable people at risk.</p>
<p>In its response, Deliveroo stressed that it is constantly working to improve oversight of its riders, including by introducing new technology and working collaboratively with the relevant authorities. It added that riders’ use of substitutes is a legitimate right of the self-employed workforce, and rejected any comparison with other labour markets.</p>
<p><em>*All names of interviewees have been changed to protect their identities</em></p>
<hr>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/313478/original/file-20200204-41481-1n8vco4.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/313478/original/file-20200204-41481-1n8vco4.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=112&fit=crop&dpr=1 600w, https://images.theconversation.com/files/313478/original/file-20200204-41481-1n8vco4.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=112&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/313478/original/file-20200204-41481-1n8vco4.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=112&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/313478/original/file-20200204-41481-1n8vco4.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=140&fit=crop&dpr=1 754w, https://images.theconversation.com/files/313478/original/file-20200204-41481-1n8vco4.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=140&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/313478/original/file-20200204-41481-1n8vco4.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=140&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption"></span>
</figcaption>
</figure>
<p><em>For you: more from our <a href="https://theconversation.com/uk/topics/insights-series-71218?utm_source=TCUK&utm_medium=linkback&utm_campaign=TCUKengagement&utm_content=InsightsUK">Insights series</a>:</em></p>
<ul>
<li><p><em><a href="https://theconversation.com/its-like-youre-a-criminal-but-i-am-not-a-criminal-first-hand-accounts-of-the-trauma-of-being-stuck-in-the-uk-asylum-system-202276?utm_source=TCUK&utm_medium=linkback&utm_campaign=TCUKengagement&utm_content=InsightsUK">‘It’s like you’re a criminal, but I am not a criminal.’ First-hand accounts of the trauma of being stuck in the UK asylum system
</a></em></p></li>
<li><p><em><a href="https://theconversation.com/a-toxic-policy-with-little-returns-lessons-for-the-uk-rwanda-deal-from-australia-and-the-us-201790?utm_source=TCUK&utm_medium=linkback&utm_campaign=TCUKengagement&utm_content=InsightsUK">‘A toxic policy with little returns’ – lessons for the UK-Rwanda deal from Australia and the US</a></em></p></li>
<li><p><em><a href="https://theconversation.com/covid-heroes-left-behind-the-invisible-women-struggling-to-make-ends-meet-198210?utm_source=TCUK&utm_medium=linkback&utm_campaign=TCUKengagement&utm_content=InsightsUK">COVID heroes left behind: the ‘invisible’ women struggling to make ends meet
</a></em></p></li>
</ul>
<p><em>To hear about new Insights articles, join the hundreds of thousands of people who value The Conversation’s evidence-based news. <a href="https://theconversation.com/uk/newsletters/the-daily-newsletter-2?utm_source=TCUK&utm_medium=linkback&utm_campaign=TCUKengagement&utm_content=InsightsUK"><strong>Subscribe to our newsletter</strong></a>.</em></p><img src="https://counter.theconversation.com/content/201695/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Pedro Mendonça receives funding from the Royal Society of Edinburgh.</span></em></p><p class="fine-print"><em><span>Ian Clark receives funding from The Art's and Humanities Research Council/Modern Slavery Policy and Evidence Centre, the Home Office Modern Slavery fund and the National Crime Agency. </span></em></p><p class="fine-print"><em><span>Nadia Kougiannou does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Our study of food delivery workers in one English city highlights the daily challenges facing undocumented migrants in this sector.Pedro Mendonça, Associate Professor of Work and Employment, Heriot-Watt UniversityIan Clark, Professor in Work and Employment, Nottingham Trent UniversityNadia Kougiannou, Associate Professor of Work and Employment, Nottingham Trent UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2043532023-04-26T05:28:44Z2023-04-26T05:28:44ZColes’ Uber Eats deal brings the gig economy inside the traditional workplace<figure><img src="https://images.theconversation.com/files/522923/original/file-20230426-14-jw8pwz.jpeg?ixlib=rb-1.1.0&rect=22%2C25%2C2149%2C1528&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">KYDPL KYODO / AP</span></span></figcaption></figure><p>This month <a href="https://www.afr.com/companies/retail/coles-uber-eats-to-offer-one-hour-grocery-delivery-20230413-p5d0b1">Coles announced a major new partnership with Uber Eats</a> that will further expand the supermarket giant’s links with the gig economy. Under the arrangement, Uber Eats drivers will not only complete home delivery for the supermarket, drivers will also pick and pack orders from supermarket shelves. </p>
<p>Previously, online orders were completed by Coles’ directly employed “personal shoppers” who would hand over the order to a delivery partner. More than 500 Coles stores across the country will start selling goods via the digital platform, with gig workers performing the role of a Coles personal shopper. </p>
<p>The deal differs from an <a href="https://www.smh.com.au/business/companies/woolworths-offers-rapid-deliveries-for-5-via-new-metro60-app-20220623-p5aw7p.html">existing partnership between Woolworths Metro60 and Uber Eats</a>, forged in June 2022, which also promises rapid delivery, albeit with orders fulfilled by supermarket workers. </p>
<p>The Coles partnership is a significant development that will see Uber Eats drivers working inside the supermarket alongside traditional employees and customers.</p>
<h2>The gig economy enters the supermarket</h2>
<p>The supermarket duopoly have been steadily recruiting gig workers into their home delivery offerings since Coles <a href="https://www.cmo.com.au/article/631121/airtasker-partners-coles-personalised-grocery-service/">set up a partnership with Airtasker</a> in 2017. Demand for rapid deliveries then surged during the pandemic years of 2020 and 2021. </p>
<p>From one perspective, Coles and Woolworths are simply outsourcing specific tasks (such as picking, packing and delivery) to Uber Eats and other gig-work platforms. From another, the supermarkets are <em>absorbing</em> gig workers into their own activities. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/coles-and-woolworths-are-moving-to-robot-warehouses-and-on-demand-labour-as-home-deliveries-soar-166556">Coles and Woolworths are moving to robot warehouses and on-demand labour as home deliveries soar</a>
</strong>
</em>
</p>
<hr>
<p>Gig workers are not formal employees and do not enjoy the same legal protections as other staff, but they are nonetheless performing work that is core supermarket business. </p>
<p>The so-called “<a href="https://www.scmr.com/article/re_inventing_the_last_mile">last mile</a>” of delivery – the final leg between a hub such as a warehouse or supermarket and the consumer – is widely considered the most difficult and unprofitable part of logistics, particularly for rapid deliveries. While both supermarkets run their own last-mile systems for deliveries booked in advance, the partnerships with Uber Eats let them offer customers rapid home delivery options while offloading the risk associated with the last mile.</p>
<h2>Potentially tens of thousands of jobs at stake</h2>
<p>In 2022, I interviewed supermarket workers about <a href="https://theconversation.com/a-weird-dinging-sound-that-everyone-dreads-what-rapid-deliveries-mean-for-supermarket-workers-185960">the impact of rapid delivery services</a>. Many expressed concerns that the gig economy was “getting closer” with some predicting the role of the personal shopper – a supermarket employee who would gather and pack items for delivery – would eventually be taken up by gig workers. </p>
<p>Coles says the Uber Eats drivers will “<a href="https://www.smh.com.au/technology/coles-to-put-500-plus-stores-on-uber-eats-in-major-gig-economy-expansion-20230413-p5d048.html">complement rather than compete</a>” with existing direct-employed supermarket employees. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/a-weird-dinging-sound-that-everyone-dreads-what-rapid-deliveries-mean-for-supermarket-workers-185960">'A weird dinging sound that everyone dreads': what rapid deliveries mean for supermarket workers</a>
</strong>
</em>
</p>
<hr>
<p>For now, gig workers and employees will work alongside each other. Over time, however, it is possible other supermarket roles will be displaced into the gig economy. </p>
<p>Coles and Woolworths are Australia’s largest private sector employers. As they bring the gig economy into their workplaces, it has the potential to affect tens of thousands of jobs. </p>
<h2>Grocery is a winner-takes-all industry</h2>
<p>The new partnership was announced just days after grocery delivery startup Milkrun officially folded. </p>
<p>Milkrun was the last standing of four Australian rapid grocery delivery startups launched in the past couple of years. The company failed to turn a profit, was quick to abandon its central proposition of ten-minute delivery, and <a href="https://www.startupdaily.net/topic/business/holy-cow-grocery-delivery-startup-milkrun-is-dead-86-million-later-aged-19-months/">burned through $86 million in venture capital</a> in less than two years. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/milkruns-demise-is-another-nail-in-the-10-minute-grocery-delivery-business-model-203757">MilkRun's demise is another nail in the 10-minute grocery-delivery business model</a>
</strong>
</em>
</p>
<hr>
<p>With much less fanfare, both Coles and Woolworths have achieved what startups couldn’t. Their advantage has been their enormous scale and market power, enabling them to push suppliers for lower prices and make use of their existing networks of distribution centres, stores, delivery vans – and now partnerships with the gig economy.</p>
<p>In an unfair playing field, the supermarket giants have the best of both worlds: vertical integration with the supply chain <em>and</em> the ability to shift risk away from the business and onto individual gig workers. </p>
<h2>Essential service or frivolous convenience?</h2>
<p>The example of Milkrun and other startups suggests the business of on-demand grocery delivery may not be feasible without an army of precariously employed workers such as Uber Eats drivers. This raises another question: do we really need or want groceries delivered this quickly?</p>
<p>The supermarkets often frame their new deliveries services as benefiting “<a href="https://www.woolworths.com.au/shop/discover/community/news/woolworths-launches-new-initiative-to-increase-grocery-home-deliveries-to-vulnerable-australians">vulnerable Australians</a>”, such as the elderly and people living with disabilities. The implication is that the availability of rapid grocery delivery is a social good, rather than simply a convenience.</p>
<p>However, if the service is truly essential, it seems the people doing the work should be valued and supported with well-paid and secure employment. What’s more, it’s not entirely convincing that rapid grocery delivery in its current form is essential at all. </p>
<p>Many personal shoppers I interviewed said on-demand purchases tended to be frivolous. Referring to the partnership between Woolworths and Uber Eats, one worker recalled: </p>
<blockquote>
<p>People are ordering […] a single banana and a Red Bull. It’s really weird the stuff you get.</p>
</blockquote>
<p>Another added: </p>
<blockquote>
<p>No one used to do it. Now, people buy only five things and they’ll pay that fee to have it delivered soon. It’s more popular for alcohol or cigarettes or something like that.</p>
</blockquote>
<p>One supermarket worker expressed deep scepticism of rapid delivery, stating:</p>
<blockquote>
<p>It didn’t seem like it was about meeting the demands of shoppers, that’s made explicit through the article cap for Uber Eats. […] You can only order 25 [items] so it wasn’t about regular shopping. Really, I think it was just more for the convenience. Instead of going to the shops yourself, you can just wait at home for it, and someone else can pick it for you. </p>
</blockquote>
<p>The cost of this convenience will be carried by supermarket workers, who in recent years have already seen their work transformed to adhere to the logic of the gig economy, with on-demand time pressures and ad-hoc scheduling. Now, as the gig economy moves into the physical supermarket space, the distinction between conventional employment and gig work is further blurred.</p><img src="https://counter.theconversation.com/content/204353/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Lauren Kate Kelly receives funding from the Australian Research Council (ARC) and the ARC Centre of Excellence for Automated Decision-Making and Society. She works with United Workers Union which has members across the supermarket supply chain. </span></em></p>Australia’s largest private-sector employers are steadily integrating gig workers into their operations.Lauren Kate Kelly, PhD Candidate, ARC Centre of Excellence for Automated Decision-Making and Society, RMIT UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1929142022-11-01T18:51:54Z2022-11-01T18:51:54ZUber Eats’ cannabis delivery partnership with Leafly is mostly smoke and mirrors<figure><img src="https://images.theconversation.com/files/492821/original/file-20221101-22-pf88r1.jpg?ixlib=rb-1.1.0&rect=574%2C1047%2C4105%2C2397&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A new partnership between Uber and Leafly allows users to order cannabis for delivery using the popular Uber Eats app.</span> <span class="attribution"><span class="source">(Shutterstock)</span></span></figcaption></figure><iframe style="width: 100%; height: 100px; border: none; position: relative; z-index: 1;" allowtransparency="" allow="clipboard-read; clipboard-write" src="https://narrations.ad-auris.com/widget/the-conversation-canada/uber-eats--cannabis-delivery-partnership-with-leafly-is-mostly-smoke-and-mirrors" width="100%" height="400"></iframe>
<p>Before 2018, cannabis was illegal in Canada. Now, as of mid-October, <a href="https://www.uber.com/en-CA/newsroom/leafly-cannabis-delivery/">Uber Eats can deliver it in Toronto</a> as the result of a partnership with Leafly, an online marketplace for licensed cannabis retailers. This is the <a href="https://apnews.com/article/canada-business-ontario-toronto-5913ace985c9d5fdec70e17bc3022f21">first time Uber will deliver cannabis anywhere in the world</a>.</p>
<p>This deal is <a href="https://www.leafly.ca/news/strains-products/uber-eats-leafly-toronto-delivery-weed">being touted by Uber and Leafly as a great leap forward for the industry</a>. The companies claim the arrangement will provide several benefits, including more business for the retailers, increased choice and flexibility for consumers while reducing the illicit market, and cutting down on impaired driving. However, these arguments hold little water.</p>
<h2>How it will work</h2>
<p>Consumers are able to use the Uber Eats platform to order cannabis products from any of three Toronto-based retailers — Hidden Leaf Cannabis, Minerva Cannabis and Shivaa’s Rose — provided they are within the retailer’s delivery footprint. </p>
<p>The ordering experience is similar to ordering food delivery on the app: customers navigate to the “recreational cannabis” category, then to their chosen retailer’s menu where they select their desired products, then state whether they will pick up the order or prefer delivery. Uber then transmits the order to the applicable store. Once filled, the order is delivered to the customer by the retailer’s own delivery staff, as prescribed by law. </p>
<p>Ontario’s provincial <a href="https://www.agco.ca/bulletin/2022/information-bulletin-supporting-cannabis-retailers-curbside-pick-and-delivery-become">cannabis regulations were only recently modified to permit delivery</a>, although they do not permit third-party delivery. The retailer’s drivers must be employees of the retailer, be <a href="https://purchase.cannsell.ca/product?catalog=CannSell-Standard-Certification">CannSell certified</a> and are required to verify identity and age at the time of delivery.</p>
<figure class="align-center ">
<img alt="Hands holding a smartphone with the Uber Eats app loading screen visible on it" src="https://images.theconversation.com/files/492651/original/file-20221031-12-zz85qx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/492651/original/file-20221031-12-zz85qx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/492651/original/file-20221031-12-zz85qx.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/492651/original/file-20221031-12-zz85qx.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/492651/original/file-20221031-12-zz85qx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/492651/original/file-20221031-12-zz85qx.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/492651/original/file-20221031-12-zz85qx.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Consumers can use the Uber Eats platform to order cannabis products from any of three Toronto-based retailers.</span>
<span class="attribution"><span class="source">(Shutterstock)</span></span>
</figcaption>
</figure>
<h2>Little to gain for consumers and retailers</h2>
<p>From the consumer’s perspective, the deal will merely provide another online location to order cannabis for delivery, on top of the <a href="https://www.ontario.ca/page/buying-recreational-cannabis">Ontario Cannabis Store and other private retailers</a>.</p>
<p>All three of the initial stores currently offer online ordering for either in-store pickup or free same-day delivery to a designated area within the Greater Toronto Area (with a minimum purchase amount). </p>
<p>Consumers can also order these same products from the Ontario Cannabis Store run by the Ontario government where they can opt for <a href="https://ocs.ca/blogs/about-my-order/shipping-updates">same-day delivery within Toronto for a fee of eight dollars</a>. Any gain on the part of consumers is minimal.</p>
<p>There’s also little in this for retailers. They will likely see a marginal increase in orders, but at what price to them? Neither the retailers nor Uber have been willing to disclose the commercial terms of this deal so we’re left to guess. Cannabis, as of this moment, doesn’t enjoy the kind of margins that can sustain the fees that Uber is charging.</p>
<p>It’s not hard to imagine that most cannabis retailers will also want to join Uber Eats down the road, when the industry has consolidated more. When this happens, it will mean overwhelming choices for consumers, <a href="https://www.scienceofpeople.com/choice-paralysis/">something that has been proven to reduce sales in other categories</a>.</p>
<h2>The profitability question</h2>
<p>Since the majority of cannabis retailers are private, we don’t have visibility into their profitability. We can, however, gain some insight into it using the Québec-owned <a href="https://www.sqdc.ca/fr-CA/">la Société québécoise du cannabis</a> as a case study. It represents the upper boundary of profitability, since they have the <a href="https://cannabisretailer.ca/2021/sales-per-store-how-do-you-stack-up/">highest sales per store in Canada on average</a>, and a relatively modest 90 store footprint compared to the <a href="https://www.agco.ca/status-current-cannabis-retail-store-applications">1,680 currently authorized in Ontario</a>. </p>
<p>La Société québécoise du cannabis is, by any measure, a healthy cannabis retailer. In their <a href="https://www.sqdc.ca/en-CA/about-the-sqdc/medias/2022/09/12/The-SQDC-reports-net-income-of-205-million-for-its-first-quarter-ended-June-18-2022">most recent quarterly report</a>, they reported a net income of $20.5 million on sales of $139 million, which translates to a net profit margin of just under 15 per cent.</p>
<figure class="align-center ">
<img alt="SQDC logo on the outside of a store" src="https://images.theconversation.com/files/492652/original/file-20221031-7758-24bv97.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/492652/original/file-20221031-7758-24bv97.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=401&fit=crop&dpr=1 600w, https://images.theconversation.com/files/492652/original/file-20221031-7758-24bv97.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=401&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/492652/original/file-20221031-7758-24bv97.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=401&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/492652/original/file-20221031-7758-24bv97.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/492652/original/file-20221031-7758-24bv97.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/492652/original/file-20221031-7758-24bv97.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">La Société québécoise du cannabis store in Montreal.</span>
<span class="attribution"><span class="source">(Shutterstock)</span></span>
</figcaption>
</figure>
<p>Uber <a href="https://news.yahoo.com/much-restaurants-really-order-grubhub-171851427.html">charges food retailers 15 per cent of their total revenue</a> to those that provide their own delivery service and use the platform solely to take orders (30 per cent if Uber’s drivers are used). Assuming Uber takes a similar bite out of cannabis retailers’ profits, there isn’t margin enough for this to make sense to retailers. The math just doesn’t work.</p>
<p>The value offered by Leafly in this arrangement is unspecified, but given their <a href="https://investor.leafly.com/news/news-details/2022/Leafly-Holdings-Inc.-Reports-Second-Quarter-2022-Financial-Results/default.aspx">recent losses in both end user and retail accounts</a>, it may be in the deal to merely juice their stock price.</p>
<h2>Uber and Leafly come out on top</h2>
<p>Arguments claiming that this partnership will help <a href="https://www.cannabisbusinesstimes.com/article/leafly-uber-eats-delivery-partnership/">reduce cannabis-impared driving and the size of the illicit market</a> are simply not defensible. While <a href="https://madd.ca/pages/wp-content/uploads/2018/05/Alcohol-and-or-Drugs-Among-Crash-Victims-Dying-Within-12-Months2c-by-Jurisdiction-Canada2c-2014_April-202c-2018.pdf">driving while high is a serious and increasingly prevalent issue</a>, the existence of another cannabis delivery service will not affect the current statistics.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/cannabis-impaired-driving-heres-what-we-know-about-the-risks-of-weed-behind-the-wheel-173823">Cannabis-impaired driving: Here’s what we know about the risks of weed behind the wheel</a>
</strong>
</em>
</p>
<hr>
<p>There are already plenty of delivery options for people who would rather stay on the right side of the law and avoid driving to the nearest store. Similarly, consumers who are interested in purchasing legal weed, not black market weed, already have the means to do so.</p>
<p>There is no reason why an Uber Eats-specific delivery service will have any more of an impact than current delivery services do. It also remains to be seen if people will want to use Uber to buy their weed in the first place, considering the options already available.</p>
<p>It’s clear that retailers and consumers will not be the winners in this new partnership — that honour goes to the middlemen, Uber and Leafly. At the moment, that seems to be the state of the Canadian cannabis industry — business is booming for provincial wholesalers, while private retailers and cannabis producers are left in the lurch.</p><img src="https://counter.theconversation.com/content/192914/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Brad Poulos does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>A third platform for ordering cannabis in Ontario provides little to no benefit to consumers or retailers.Brad Poulos, Lecturer and Ambassador for Cannabis Education, Entrepreneurship and Strategy Department, Toronto Metropolitan UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1800832022-04-19T12:20:15Z2022-04-19T12:20:15ZPayment apps asking for specific tips before service annoy the heck out of users – but still generate bigger gratuities<figure><img src="https://images.theconversation.com/files/456708/original/file-20220406-14-hl6tfb.jpg?ixlib=rb-1.1.0&rect=34%2C8%2C5509%2C3819&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Customers may prefer the old-fashioned tip jar. </span> <span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/photo/unrecognizable-coffee-shop-customer-using-tip-jar-royalty-free-image/938547524">SDI Productions/iStock via Getty Images</a></span></figcaption></figure><p><em>The <a href="https://theconversation.com/us/topics/research-brief-83231">Research Brief</a> is a short take about interesting academic work.</em> </p>
<h2>The big idea</h2>
<p>Asking customers to leave specific tip amounts before food is delivered or provided prompts larger gratuities but also leads to lower satisfaction – especially if the payment page design is crowded, <a href="http://www.doi.org/10.1177/10963480221076467">I found in new research I co-authored</a>. </p>
<p>My colleagues and I conducted three studies and a survey to explore how consumers are responding to the <a href="https://www.today.com/money/guilt-tipping-are-square-mobile-payments-making-us-tip-everyone-t126151">use of tip suggestions</a> on digital payment devices. All participants for the study were recruited via the crowdsourcing website Mechanical Turk and were required to have eaten out or experienced a similar service in the past 12 months and left a tip. </p>
<figure class="align-right ">
<img alt="Two payments interfaces sit side by side with prices for a 'pizza set.' The one on the left has suggested tipping options 15% 20% 25% and the other has an empty box with optional tip" src="https://images.theconversation.com/files/456922/original/file-20220407-12-168o8a.png?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/456922/original/file-20220407-12-168o8a.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=517&fit=crop&dpr=1 600w, https://images.theconversation.com/files/456922/original/file-20220407-12-168o8a.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=517&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/456922/original/file-20220407-12-168o8a.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=517&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/456922/original/file-20220407-12-168o8a.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=650&fit=crop&dpr=1 754w, https://images.theconversation.com/files/456922/original/file-20220407-12-168o8a.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=650&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/456922/original/file-20220407-12-168o8a.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=650&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Study participants were shown either a payment interface with suggested tip amounts or simply an optional box.</span>
<span class="attribution"><span class="source">Fan, Wu, Liu (2022)</span></span>
</figcaption>
</figure>
<p>In our first study, we asked 134 people to imagine themselves ordering a large pizza that cost about US$28.97, including taxes and fees, from a local restaurant via a mobile app on their phones. They were shown a payment page similar in design to what you would find on apps like DoorDash and Uber Eats. Half of the participants viewed a payment page that noted “tipping optional” next to an empty box into which users could enter a gratuity if they so chose. The other half saw specific tip suggestions, 15%, 20% and 25%, as well as a “custom” option. We highlighted 20% as the default. </p>
<p>We then asked them to rate how they felt about the paying experience, whether they felt manipulated and how much they would tip. We found that participants who saw specific suggestions gave significantly higher tips but also reported feeling manipulated and more dissatisfied with the experience. </p>
<p>In a second study, we wanted to test whether the design of the payment page made much of a difference. <a href="https://doi.org/10.1177/1094670520904408">Past research on spatial crowding</a> has found that less-crowded screens are less stressful to consumers and make them less likely to react emotionally. So we replicated the first study with 280 more participants with the two tipping options; half of them viewed a relatively cluttered design, while the rest saw more white space between words and graphics. </p>
<figure class="align-right ">
<img alt="Two payments interfaces sit side by side with prices for a 'pizza set'. The one on the left is slightly smaller with less spacing between words and elements than the one on the right" src="https://images.theconversation.com/files/456923/original/file-20220407-14-m6nm9q.png?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/456923/original/file-20220407-14-m6nm9q.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=504&fit=crop&dpr=1 600w, https://images.theconversation.com/files/456923/original/file-20220407-14-m6nm9q.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=504&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/456923/original/file-20220407-14-m6nm9q.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=504&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/456923/original/file-20220407-14-m6nm9q.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=634&fit=crop&dpr=1 754w, https://images.theconversation.com/files/456923/original/file-20220407-14-m6nm9q.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=634&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/456923/original/file-20220407-14-m6nm9q.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=634&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Study participants found the more roomy layout less dissatisfying.</span>
<span class="attribution"><span class="source">Fan, Wu, Liu (2022)</span></span>
</figcaption>
</figure>
<p>We found that people still tipped more when given suggested amounts. But the less-cluttered design resulted in less dissatisfaction in the payment experience. </p>
<p>Our final study repeated the same basic structure of the second except we had our 201 participants view the payment pages – cluttered or spaced out – on a computer. We found similar results, with tip suggestions yielding higher gratuities and a crowded design resulting in more dissatisfaction than a spacious one. </p>
<p>Finally, we conducted a survey and found that people said they’re more likely to patronize a restaurant and say positive things about it if the digital payment experience is a good one. </p>
<p>[<em>Get the best of The Conversation, every weekend.</em> <a href="https://memberservices.theconversation.com/newsletters/?nl=weekly&source=inline-weeklybest">Sign up for our weekly newsletter</a>.]</p>
<h2>Why it matters</h2>
<p>Whether ordering a cappuccino at a cafe or a pizza from a delivery app, it seems like we’re all being increasingly asked to tip before tasting our food or experiencing delivery or other service. A point-of-sale provider <a href="https://www.today.com/money/guilt-tipping-are-square-mobile-payments-making-us-tip-everyone-t126151">recently reported</a> that about half of its “quick serve” clients, like cafes and bakeries, and almost a quarter of all its merchants used the suggested tip feature on their payment screens. </p>
<p>And of course tips are important for the workers who <a href="https://flowingdata.com/2017/08/03/working-on-tips/">depend on them</a>. Gratuities make up a significant amount of service workers’ take-home pay. Servers, for example, <a href="https://www.nelp.org/publication/wait-staff-and-bartenders-depend-on-tips-for-more-than-half-of-their-earnings">earn over half of their incomes</a> on tips alone. </p>
<p>Our research shows suggesting tip amounts is indeed effective at increasing tip amounts. But this comes at a cost when consumers feel manipulated into forking over more money before their pizza or coffee has even arrived. Our survey showed that this may lead people to avoid ordering from a given restaurant in the future. </p>
<p>Companies can use a less-cluttered payment interface to hold on to more customers.</p>
<h2>What’s next</h2>
<p>We hope to do further research on how different social cues, such as explaining to customers the importance of tips to delivery and other service workers, might affect customer satisfaction when using the tipping feature of digital payment apps.</p><img src="https://counter.theconversation.com/content/180083/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Alei Fan does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Delivery services and cafes commonly prompt customers to leave a specific tip – for example, 15%, 20%, 25% – at the point of sale rather than after completing the service.Alei Fan, Assistant Professor of Hospitality and Tourism Management, Purdue UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1589422021-04-15T01:54:22Z2021-04-15T01:54:22ZDid somebody say workers’ rights? Three big questions about Menulog’s employment plan<p>Menulog, Australia’s second-largest food ordering and delivery platform, has declared it will break with the standard “gig platform” business model and engage some of its couriers as employees, not independent contractors.</p>
<p>“<a href="https://www.smh.com.au/politics/federal/we-owe-it-to-our-couriers-menulog-trials-employee-rights-for-workers-20210412-p57iin.html">We owe it to our couriers,</a>” Menulog’s managing director Morten Belling told the Senate Select Committee <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Job_Security/JobSecurity">inquiry into job security</a> this week. The inquiry is investigating the scope of insecure or precarious employment in Australia.</p>
<p>The Transport Workers’ Union says Menulog’s move is a “<a href="https://www.news.com.au/finance/work/at-work/menulog-announces-trial-to-improve-pay-for-delivery-riders-union-applauds-move-as-watershed-moment/news-story/6a564847772b761cd16798edc7231987">watershed moment for the gig economy</a>”. By committing to pay couriers a minimum wage and superannuation, it is going further than its competitors such as <a href="https://journals.sagepub.com/doi/full/10.1177/0022185618817069">UberEats and Deliveroo</a>.</p>
<p>But let’s not get too excited yet. </p>
<p>What Menulog has announced is just a pilot program, offering employment to some couriers in Sydney’s CBD. How much of an overall benefit it makes even to those workers will depend on the details. </p>
<p>Work can still be insecure and poorly paid even when a worker is “employed”. Just ask many casual employees in the <a href="https://doi.org/10.1177/0143831X18765247">hospitality</a>, horticulture and retail sectors.</p>
<h2>Accepting greater responsibility</h2>
<p>To give Menulog credit, the company isn’t legally obliged to make this change. </p>
<p>The prevailing independent contractor model, paying workers “piece” rates with no benefits such as superannuation and paid leave, is controversial yet thus far legal – even though it means many <a href="https://www.abc.net.au/news/2021-04-12/uber-eats-drivers-earn-less-than-minimum-wage-inquiry/100062900">earn less than the minimum wage</a>.</p>
<p>In engaging couriers as employees, Menulog is accepting greater responsibility for their welfare. Things like insurance and workers compensation become straightforward. As contractors, already lowly paid workers are often responsible for their own insurance. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/workers-compensation-doesnt-cover-gig-workers-heres-a-way-to-protect-them-99946">Workers' compensation doesn't cover gig workers – here's a way to protect them</a>
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<p>These are vitally important issues given the risks involved in courier work. Last year <a href="https://www.smh.com.au/national/nsw/fifth-food-delivery-rider-dies-following-truck-crash-in-central-sydney-20201123-p56h9y.html">five delivery riders were killed</a> in traffic accidents. Though none were Menulog couriers, Belling mentioned this as a key driver for the company’s change. </p>
<p>The shift to an employment model should also result in greater income certainty for workers. But to what extent they will be better off depends on at least three important details. </p>
<h2>1. What’s the award?</h2>
<p>The first question is what <a href="https://www.fwc.gov.au/awards-and-agreements/awards/modern-awards">modern award</a> – the document that sets minimum terms and conditions of employment within a specific industry or occupation – will couriers be employed under. </p>
<p>According to Menulog there are “<a href="https://mashable.com/article/menulog-gig-contractor-employee-australia/">a number of challenges</a>” in moving to an employment model, with Australia’s award system cited as a potential barrier. </p>
<p>The award now covering couriers is the <a href="http://awardviewer.fwo.gov.au/award/show/MA000038">Road Transport and Distribution Award 2020</a>. Menulog has indicated it wants delivery workers to be covered by a new award, and intends to consult with the union to create it. </p>
<p>It hasn’t spelt out what the specific “challenges” in the existing award are – employer groups often talk in generalities about a <a href="https://www.aigroup.com.au/policy-and-research/mediacentre/releases/workplace-flexibility-22Apr/">lack of flexibility</a> – but it may include removing minimum engagement periods.</p>
<p>Under the existing award – as with others – a casual employee must be paid for a minimum four-hour shift. Minimum engagement periods are important for giving workers some certainty as to how much they will earn when asked to work. In contrast, an independent contractor can be engaged for a one-off delivery that may only be for a few minutes to earn a few dollars. </p>
<p>The award also stipulates penalty rates and allowances for unsociable hours or days (such as public holidays).</p>
<p>If Menulog’s move involves eroding fundamental award principles about minimum hours and payments, its couriers could find “employment” isn’t much better their current conditions. </p>
<h2>2. Does every worker get to be an employee?</h2>
<p>Even given the limited scope of the trial (Menulog operates throughout Australia and New Zealand, while its parent company Just Eat Takeaway operates in <a href="https://www.justeattakeaway.com/about-us/our-markets/">23 countries</a>) it is unclear if the platform plans to make all couriers working in Sydney’s CBD employees.</p>
<hr>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/394942/original/file-20210414-15-kn9lm2.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/394942/original/file-20210414-15-kn9lm2.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/394942/original/file-20210414-15-kn9lm2.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=360&fit=crop&dpr=1 600w, https://images.theconversation.com/files/394942/original/file-20210414-15-kn9lm2.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=360&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/394942/original/file-20210414-15-kn9lm2.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=360&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/394942/original/file-20210414-15-kn9lm2.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=453&fit=crop&dpr=1 754w, https://images.theconversation.com/files/394942/original/file-20210414-15-kn9lm2.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=453&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/394942/original/file-20210414-15-kn9lm2.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=453&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Menulog’s parent company Just Eat Takeaway has operations in 21 countries and partnerships in two others (Brazil and Colombia).</span>
<span class="attribution"><a class="source" href="https://www.justeattakeaway.com/about-us/our-markets/">www.justeattakeaway.com</a></span>
</figcaption>
</figure>
<hr>
<p>Or will it end up with a two-tier system, where some couriers are engaged as employees and other remain contractors? If this is the case, it could make contract work even more precarious. </p>
<p>It’s important to know who gets to be an employee and why. This should be transparent. Platform companies are notorious for their “black-box” <a href="https://theconversation.com/algorithms-workers-cant-see-are-increasingly-pulling-the-management-strings-144724">algorithmic management</a>. Their algorithms now effectively make <a href="https://journals.sagepub.com/doi/full/10.1177/0950017019836911">workers compete with each other for gigs</a>. A system that makes them compete for the chance to be rewarded with the badge of “employee” is hardly much better. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/algorithms-workers-cant-see-are-increasingly-pulling-the-management-strings-144724">Algorithms workers can't see are increasingly pulling the management strings</a>
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<h2>3. How to deal with multi-apping?</h2>
<p>It is a feature of the gig economy that couriers often work on multiple apps at the same time to try and win more gigs – a practice known as “<a href="https://journals.sagepub.com/doi/full/10.1177/0308518X20914346">multi-apping</a>”. </p>
<p>If they become Menulog employees, will they have to forego this right? Will they be allowed to earn money through other platforms during times when they’re not employed? </p>
<p>Again, these details will need to be worked out. The answer will have ramifications across the food delivery industry. </p>
<h2>Finally, are customers willing to pay?</h2>
<p>Menulog’s announcement has been welcomed by unions, including the Australian Council of Trade Unions’ <a href="https://www.actu.org.au/actu-media/media-releases/2021/unions-welcome-menulog-decision-to-change-their-business-model-to-give-employees-rights">head Sally McManus</a>. But the details that remain unclear are fundamentally important.</p>
<p>This trial may mark a major shift in this part of the “gig economy”. The head of Just Eat Takeaway, Jitse Groen, said last year he would rather his workers get more <a href="https://www.bbc.com/news/business-53780299">protections and benefits</a>. Belling told the Senate inquiry that treating couriers as employees “may cost us more, but it’s the right thing to do”. </p>
<p>But how much more Menulog is prepared to pay also depends on how much more customers are <a href="https://doi.org/10.1016/j.jocm.2020.100254">willing to pay</a>.</p>
<p>It is important for the gig economy as a whole that Menulog get this right in Australia. That will depend on the answers to the above questions.</p><img src="https://counter.theconversation.com/content/158942/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Tom Barratt is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project.</span></em></p><p class="fine-print"><em><span>Alex Veen is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project. </span></em></p><p class="fine-print"><em><span>Caleb Goods is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project.</span></em></p>Food-ordering platform Menulog has declared it will break with the standard contractor business model. But let’s not get too excited yet.Tom Barratt, Lecturer, Centre for Work + Wellbeing, Edith Cowan UniversityAlex Veen, Lecturer and DECRA Fellow, University of SydneyCaleb Goods, Senior Lecturer - Management and Organisations, UWA Business School, The University of Western AustraliaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1558492021-03-30T13:15:19Z2021-03-30T13:15:19ZGovernments must work with restaurants on a no-fee delivery app<figure><img src="https://images.theconversation.com/files/391229/original/file-20210323-20-rywpxe.jpg?ixlib=rb-1.1.0&rect=772%2C925%2C4643%2C2829&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A food delivery worker wearing a face mask to help curb the spread of COVID-19 is framed by a large public art installation while riding a bike in Vancouver in November 2020. </span> <span class="attribution"><span class="source">THE CANADIAN PRESS/Darryl Dyck</span></span></figcaption></figure><p>To say it’s been a rough year for the restaurant industry is an understatement. </p>
<p>Restaurants across Canada have suffered immensely from stay-at-home orders, strict in-person seating capacity restrictions and other lockdown measures induced by the COVID-19 pandemic. Ten per cent of Canada’s independent restaurants have already permanently shut down in light of pandemic-related hardships, and <a href="https://www.restaurantscanada.org/industry-news/new-federal-assistance-will-help-restaurants-survive-covid-19/">recent estimates</a> project that another 40 per cent may not survive beyond March 2021.</p>
<figure class="align-center ">
<img alt="Customers sit on a patio at a bar." src="https://images.theconversation.com/files/391187/original/file-20210323-15-2kl216.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/391187/original/file-20210323-15-2kl216.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/391187/original/file-20210323-15-2kl216.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/391187/original/file-20210323-15-2kl216.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/391187/original/file-20210323-15-2kl216.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/391187/original/file-20210323-15-2kl216.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/391187/original/file-20210323-15-2kl216.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Customers sit on a patio at a bar in Toronto on March 20, 2021 — the day restaurants in Toronto and Peel Region were allowed to offer customers outdoor dining.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Chris Young</span></span>
</figcaption>
</figure>
<p>To remain afloat during these trying times, many restaurants have relied — often reluctantly — on food delivery applications like Uber Eats, Door Dash and Skip the Dishes, despite recognizing the untenability of the high commission fees they command, some as high as <a href="https://www.thestar.com/news/canada/2020/04/28/canadian-restaurants-feel-squeezed-by-delivery-apps-commission-fees-amid-covid-19-crisis.html">30 per cent</a>. </p>
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Read more:
<a href="https://theconversation.com/capping-food-delivery-app-fees-could-save-restaurants-this-covid-19-winter-151631">Capping food delivery app fees could save restaurants this COVID-19 winter</a>
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<p>In an effort to help restaurants, several provinces have proposed capping food delivery fees and, while laudable, these efforts do not suffice. If the intent is to save restaurants, many of which are deeply woven in the fabric of neighbourhoods and communities across Canada, a bolder solution is needed. The Canadian government must partner with restaurant associations to create its own no-fee food delivery platform.</p>
<h2>Monumental growth</h2>
<p>In this past year, third-party food delivery apps have experienced <a href="https://www.bbc.com/news/business-54834809">monumental growth</a> and have come to represent a significant share of restaurants’ overall business, making them all the more indispensable during these trying times. These apps work by connecting hungry customers to their favourite restaurants and enable seamless mobile transactions in exchange for a commission fee. </p>
<p>While it may be argued that such apps served as a lifeline for restaurants during the pandemic, many <a href="https://www.nytimes.com/2020/06/10/technology/food-delivery-apps.html">restaurant owners</a> are quick to point out that the increase in delivery app sales did not necessarily translate to higher earnings. That’s because the revenue generated through these apps were largely negated by exorbitant commission fees. </p>
<p>Whatever modest short-term revenue gains restaurants did experience through delivery apps has also come at the expense of their long-term chances of success. At the best of times, restaurants operate on razor-thin margins and simply cannot afford to have delivery apps shave off an additional portion of their revenues. </p>
<figure class="align-center ">
<img alt="A food delivery worker rides an electric bike" src="https://images.theconversation.com/files/391188/original/file-20210323-14-b97itk.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C6500%2C4388&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/391188/original/file-20210323-14-b97itk.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=405&fit=crop&dpr=1 600w, https://images.theconversation.com/files/391188/original/file-20210323-14-b97itk.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=405&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/391188/original/file-20210323-14-b97itk.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=405&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/391188/original/file-20210323-14-b97itk.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=509&fit=crop&dpr=1 754w, https://images.theconversation.com/files/391188/original/file-20210323-14-b97itk.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=509&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/391188/original/file-20210323-14-b97itk.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=509&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">A food delivery worker rides an electric bike in downtown Vancouver in January 2021.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Darryl Dyck</span></span>
</figcaption>
</figure>
<p>Restaurants’ reliance on delivery apps may have been necessary during the pandemic, when trying to avoid bankruptcy. But it cannot be sustained indefinitely, especially if online orders end up permanently replacing those that would otherwise have been made through restaurants directly.</p>
<p><a href="https://ottawa.ctvnews.ca/don-t-be-greedy-ford-pleads-with-food-delivery-companies-to-drop-fees-on-struggling-businesses-1.5146925">Many have accused</a> food delivery companies of being greedy given how much restaurants have suffered during the pandemic, and have pressured governments to intervene. Heeding to mounting concerns from their constituents, mayors and premiers across Canada <a href="https://news.ontario.ca/en/release/59761/ontario-caps-food-delivery-fees-to-protect-small-businesses">passed legislation</a> to cap food delivery charges. </p>
<h2>Only minor concessions</h2>
<p>But unfortunately, these efforts have only led to minor concessions from food delivery apps and are largely regarded as insufficient by Canadian restaurant associations, many of which saw their members <a href="https://www.restaurantscanada.org/industry-news/restaurants-need-data-and-more-immediate-support-to-survive-indoor-dining-closures/">lose upwards of 80 per cent of their business</a> at a time when food delivery apps were registering soaring profits. </p>
<p>This sentiment was further echoed by <a href="https://www.newswire.ca/news-releases/struggling-app-workers-fear-being-made-to-pay-for-delivery-fee-cap-864145120.html">many Canadians</a> who did not place much trust in these temporary measures — nor in bargaining with Silicon Valley-based companies — and did not wish to imagine their cities devoid of the life, vibrancy and diversity that restaurants contribute. To ensure the survival of restaurants, governments must go beyond capping food delivery charges, and must offer a no-fee food delivery platform.</p>
<figure class="align-center ">
<img alt="A food delivery person wears a protective face mask to prevent the spread of COVID-19 as he picks up food." src="https://images.theconversation.com/files/391197/original/file-20210323-19-1s972oj.jpg?ixlib=rb-1.1.0&rect=63%2C886%2C3347%2C1714&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/391197/original/file-20210323-19-1s972oj.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=410&fit=crop&dpr=1 600w, https://images.theconversation.com/files/391197/original/file-20210323-19-1s972oj.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=410&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/391197/original/file-20210323-19-1s972oj.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=410&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/391197/original/file-20210323-19-1s972oj.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=515&fit=crop&dpr=1 754w, https://images.theconversation.com/files/391197/original/file-20210323-19-1s972oj.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=515&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/391197/original/file-20210323-19-1s972oj.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=515&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">A food delivery man wears a protective face mask to prevent the spread of COVID-19 as he picks up food in Vancouver in December 2020.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Jonathan Hayward</span></span>
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</figure>
<p>Admittedly, government agencies are not often top of mind when it comes to app development. But they could easily use a portion of the <a href="https://www.canada.ca/en/innovation-science-economic-development/news/2020/10/government-of-canada-expands-regional-relief-and-recovery-fund-to-provide-further-support-for-businesses.html">$1.5 billion promised</a> as part of the federal government’s Regional Relief and Recovery Fund to outsource this task. </p>
<p>Or they could use some of this fund to support existing efforts led by Canadian restaurant associations. The Ontario Restaurant Hotel and Motel Association, for instance, is in the midst of launching a <a href="https://www.iheartradio.ca/newstalk-1010/news/industry-group-to-launch-app-to-compete-with-uber-eats-and-door-dash-1.13757247">food delivery app</a> in Toronto that promises to charge less than 10 per cent commission fees and expects to expand its services to other jurisdictions in the near future.</p>
<p>Partnering on such initiatives and offering financial support to enable restaurant association-backed apps to reduce their commission fees even further during the pandemic would not only provide restaurants with much-needed relief. It would also prepare them for a future in which app-based deliveries account for a sizeable share of their overall sales. </p>
<h2>Apps are here to stay</h2>
<p>According to <a href="https://cdn.dal.ca/content/dam/dalhousie/pdf/sites/agri-food/COVID%20Online%20food%20activity%20(November%202020)%20EN%20R.pdf">a recent study</a> by researchers at Dalhousie University, 64 per cent of Canadians have ordered food online in the past six months. But even more striking is that almost 50 per cent say they intend to keep doing so at least once per week once the pandemic is over.</p>
<p>Food delivery apps are here to stay, but bargaining with large tech companies or passing temporary legislation to limit their fees will do very little to help the restaurant industry succeed in a post-pandemic world. </p>
<p>Instead, the federal government must support grassroots efforts led by restaurant associations to create a no-commission-fee delivery app option during the pandemic. The fees can later be increased to cover the app’s operating costs, at which point it will hopefully have garnered a large enough base of users to compete with the food delivery giants. </p>
<p>Only then will the Canadian restaurant industry have the tools necessary to ensure its survival both during and beyond the COVID-19 pandemic.</p><img src="https://counter.theconversation.com/content/155849/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Mischa Young does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Food delivery apps are here to stay. That means governments must support restaurant association efforts to create a no-commission-fee delivery app option — during the pandemic and beyond.Mischa Young, Course Instructor, Human Geography, University of TorontoLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1515642021-01-18T19:03:39Z2021-01-18T19:03:39ZHome-delivered food has a huge climate cost. So which cuisine is the worst culprit?<figure><img src="https://images.theconversation.com/files/379164/original/file-20210118-21-l1v63c.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C5693%2C3801&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Over the past few years, Australians have embraced online food delivery services such as UberEats, Deliveroo and Menulog. But home-delivered food comes with a climate cost, and single-use packaging is one of the biggest contributors.</p>
<p><a href="https://www.sciencedirect.com/science/article/pii/S0921344920306145?dgcid=coauthor">Our research</a> found Australians placed 27 million online food orders in 2018. By 2024, this number is projected to increase to 65 million. </p>
<p>The increasing use of take-away food packaging associated with online meal deliveries is making the food sector’s <a href="https://www.imf.org/external/chinese/pubs/ft/fandd/2019/12/pdf/farming-food-and-climate-change-batini.pdf">already massive</a> carbon footprint even larger. Of the five cuisines we examined, packaging from burger meals was responsible for the most emissions, followed by Thai meals.</p>
<p>Last year, lockdowns related to COVID-19 led to a <a href="https://www.theage.com.au/national/australians-urged-to-ditch-rubbish-habits-picked-up-in-lockdown-20201215-p56nkm.html">20% increase in household solid wastes</a> due in part to increased food deliveries. The climate crisis and problems facing Australia’s waste management sector mean we must urgently reduce waste from meals ordered online.</p>
<figure class="align-center ">
<img alt="Food packaging waste in a bin" src="https://images.theconversation.com/files/379166/original/file-20210118-15-rzukhs.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/379166/original/file-20210118-15-rzukhs.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/379166/original/file-20210118-15-rzukhs.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/379166/original/file-20210118-15-rzukhs.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/379166/original/file-20210118-15-rzukhs.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/379166/original/file-20210118-15-rzukhs.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/379166/original/file-20210118-15-rzukhs.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Australians have embraced online food deliveries, but this has caused a waste problem.</span>
<span class="attribution"><span class="source">Shutterstock</span></span>
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<h2>A growing problem</h2>
<p>Technology, income and lifestyle changes mean fewer people are cooking at home or dining in restaurants, and more are having food delivered to their door. Some <a href="https://www.statista.com/outlook/374/107/online-food-delivery/australia?currency=aud">9.4 million Australians</a> are now registered users of online food delivery services, according to business data platform Statista. </p>
<p>In most cases, online food deliveries require single-use packaging. Producing, transporting and disposing of this packaging requires large quantities of energy and raw materials. Those materials release emissions as they break down in landfill or the environment, or are burned.</p>
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Read more:
<a href="https://theconversation.com/using-lots-of-plastic-packaging-during-the-coronavirus-crisis-youre-not-alone-135553">Using lots of plastic packaging during the coronavirus crisis? You're not alone</a>
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<p>Our research found in 2018, the disposal of single use packaging from online food orders in Australia led to 5,600 tonnes of carbon dioxide-equivalent (CO₂-e) emissions. The sector is growing by more than 15% each year, which means the packaging emissions will reach 13,200 tonnes of CO₂-e in 2024.</p>
<figure class="align-center ">
<img alt="A man orders food via a smartphone app" src="https://images.theconversation.com/files/379167/original/file-20210118-15-1bn5g2e.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/379167/original/file-20210118-15-1bn5g2e.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/379167/original/file-20210118-15-1bn5g2e.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/379167/original/file-20210118-15-1bn5g2e.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/379167/original/file-20210118-15-1bn5g2e.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/379167/original/file-20210118-15-1bn5g2e.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/379167/original/file-20210118-15-1bn5g2e.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Online food deliveries are set to increase in coming years.</span>
<span class="attribution"><span class="source">Shutterstock</span></span>
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<h2>Emissions by cuisine</h2>
<p><a href="https://www.sciencedirect.com/science/article/pii/S0921344920306145?dgcid=coauthor">Our study</a> quantified how much greenhouse gas is emitted over the life of food packaging used in online food delivery. Specifically, we examined five popular cuisine types: pizzas, burgers, Indian, Thai and Chinese. </p>
<p>The results, from lowest to highest, are presented below, in terms of carbon dioxide equivalent (CO₂-e):</p>
<ul>
<li><p>Chinese: 0.16kg CO₂-e for a plastic container and plastic bag </p></li>
<li><p>Indian: 0.18 kg CO₂-e for a plastic container, paper bag and cling film</p></li>
<li><p>Pizza: 0.20kg CO₂-e for a cardboard box</p></li>
<li><p>Thai: 0.23 kg CO₂-e for a plastic container and paper bag</p></li>
<li><p>Burger meal: 0.29 kg CO₂-e for a paper bag, paper boxes, plastic straw, liquid paperboard cup with plastic lid and cardboard cup holder.</p></li>
</ul>
<p>The typical meal from each restaurant was determined, and the packaging assessed. Obviously, the exact packaging used varies according to the specific order, restaurant and customer preferences, and individual meals may have a carbon footprint higher or lower than average for that cuisine.</p>
<p>We also found a brown paper delivery bag produces far more emissions than a plastic bag, due to the carbon released when it breaks down. However plastic bags generally create more litter and are more toxic to the environment than paper bags.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/377535/original/file-20210107-15-qp4tfn.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/377535/original/file-20210107-15-qp4tfn.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/377535/original/file-20210107-15-qp4tfn.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=392&fit=crop&dpr=1 600w, https://images.theconversation.com/files/377535/original/file-20210107-15-qp4tfn.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=392&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/377535/original/file-20210107-15-qp4tfn.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=392&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/377535/original/file-20210107-15-qp4tfn.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=492&fit=crop&dpr=1 754w, https://images.theconversation.com/files/377535/original/file-20210107-15-qp4tfn.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=492&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/377535/original/file-20210107-15-qp4tfn.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=492&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Greenhouse gas emissions associated with packaging per order, by cuisine and life cycle stage.</span>
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<h2>Worst packaging culprits</h2>
<p>Our study found the production of the raw materials used in packaging – that is, fuels for plastic and wood pulp for paper and cardboard – contributes more than 50% of the total packaging emissions. Converting the raw materials into packaging products is the next highest contributor, at between 32% and 48%. </p>
<p>Replacing virgin raw materials with recycled content can reduce production emissions, but only by about 10%, due to the energy required in the recycling process. So reducing packaging use is more important than increasing the recycled content of materials.</p>
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Read more:
<a href="https://theconversation.com/australias-waste-export-ban-becomes-law-but-the-crisis-is-far-from-over-151675">Australia's waste export ban becomes law, but the crisis is far from over</a>
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<p>We also found the packaging disposal method can dramatically influence emissions. We assumed typical recycling rates of between 18% and 77%. However, if all packaging is sent to landfill, disposal-related emissions may increase by up to 15 times compared to the typical disposal scenario. </p>
<p>Paper-based packaging had the greatest disposal emissions due to its high carbon content. If all packaging materials are incinerated, then disposal emissions can be up to 49 times higher than the typical disposal scenario. </p>
<p>Plastics produce least emissions when disposed in landfill as opposed to recycling or incineration. And organic material such as paper and paperboard produce more emissions when disposed to landfill than if recycled or incinerated. So a material-specific approach to waste disposal and processing is important. </p>
<figure class="align-center ">
<img alt="A burger meal in paper packaging" src="https://images.theconversation.com/files/379169/original/file-20210118-15-1fjqmyp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/379169/original/file-20210118-15-1fjqmyp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/379169/original/file-20210118-15-1fjqmyp.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/379169/original/file-20210118-15-1fjqmyp.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/379169/original/file-20210118-15-1fjqmyp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/379169/original/file-20210118-15-1fjqmyp.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/379169/original/file-20210118-15-1fjqmyp.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Organic packaging materials are not a panacea for the waste problem.</span>
<span class="attribution"><span class="source">Shutterstock</span></span>
</figcaption>
</figure>
<h2>The way forward</h2>
<p>The task of reducing single-use packaging has been made more urgent by <a href="https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r6573">new federal laws</a> banning the export of unprocessed waste from Australia. </p>
<p>Increasing and improving waste recovery and processing infrastructure will help divert waste from landfill. However, packaging production – with both virgin and recycled raw materials – is very emissions-intensive. So producing less packaging in the first place is key to significant emissions reduction.</p>
<p>Online food delivery service providers should make it easier for customers to opt out of certain packaging products, such as bags and utensils. Investment in more environmentally friendly packaging options is also crucial. </p>
<p>Customers have a role to play, and consumer awareness and education campaigns will be important here. Refusing packaging where possible or choosing more eco-friendly options will also help to reduce single-use packaging emissions.</p>
<p><em>This article draws on research by former University of Melbourne Masters student Indumathi Arunan.</em></p>
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<strong>
Read more:
<a href="https://theconversation.com/recycling-is-not-enough-zero-packaging-stores-show-we-can-kick-our-plastic-addiction-106357">Recycling is not enough. Zero-packaging stores show we can kick our plastic addiction</a>
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<img src="https://counter.theconversation.com/content/151564/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Robert Crawford receives funding from The Australian Research Council. </span></em></p>Of the five cuisines examined, packaging from burger meals was responsible for the most emissions.Robert Crawford, Associate Professor in Construction and Environmental Assessment, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1516312020-12-16T18:42:48Z2020-12-16T18:42:48ZCapping food delivery app fees could save restaurants this COVID-19 winter<figure><img src="https://images.theconversation.com/files/375235/original/file-20201215-13-111j58i.jpg?ixlib=rb-1.1.0&rect=474%2C0%2C2694%2C2549&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">An Uber Eats courier pick ups an order for delivery from a restaurant in Toronto. </span> <span class="attribution"><span class="source">THE CANADIAN PRESS/Nathan Denette</span></span></figcaption></figure><p>The COVID-19 pandemic has been <a href="https://www.forbes.com/sites/lesliewu/2020/08/31/60-percent-of-canadian-restaurants-could-close-in-the-next-three-months-due-to-covid-19-says-industry-group/">extremely difficult on restaurants, and it’s not over yet</a>.</p>
<p>Infection numbers continue to rise and the weather is getting worse. Patios are no longer an option. This means that takeout and delivery have become a lifeline for restaurants. </p>
<p><a href="https://www.cbc.ca/news/business/food-delivery-apps-fees-1.5765790">But delivery apps charge significant fees for orders</a>, meaning that restaurants already challenged by reduced volumes and high costs are squeezed, often into negative margins, in an effort to access customers. </p>
<p>There have been <a href="https://www.cbc.ca/news/canada/toronto/toronto-food-service-delivery-companies-request-cap-commissions-1.5781177">calls for a reduction in the fees</a> charged by delivery apps so that restaurants can at least maintain a delivery option during the pandemic restrictions — and survive. </p>
<p>Delivery companies like Uber Eats, Skip the Dishes, Door Dash and others provide not only the delivery service, but a platform for ordering. Given the relatively small number of apps and the large number of restaurants, this means delivery apps have significant market power. That’s why there’s such competition for restaurants among the apps.</p>
<h2>Restaurants feel a need to be on the app</h2>
<p>The bigger the share of consumers, the bigger the draw for restaurants to join the app, and the more power the app has over demand. Many customers go to the app before deciding what to order, which will become an even more common occurrence if there are more restaurants to choose from on the app.</p>
<p>If restaurants aren’t on the app, they lose the opportunity to sell to that customer. </p>
<p>The majority of delivery apps aren’t making money yet, but are fighting for share to get to a point where they’re profitable. </p>
<p>Some apps charge as much as a <a href="https://www.blogto.com/eat_drink/2020/04/food-delivery-app-commission-toronto-restaurants/">30 per cent commission on food orders</a>. Most restaurants work on tight margins, and these hefty delivery app fees often mean there’s no profit left for them after they pay the delivery company. This means they get caught between a rock and a hard place in making the choice to access an app — sell nothing or sell through the app and lose money.</p>
<figure class="align-center ">
<img alt="A man looks at the Uber Eats app on his laptop" src="https://images.theconversation.com/files/375238/original/file-20201215-17-uannmg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/375238/original/file-20201215-17-uannmg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/375238/original/file-20201215-17-uannmg.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/375238/original/file-20201215-17-uannmg.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/375238/original/file-20201215-17-uannmg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/375238/original/file-20201215-17-uannmg.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/375238/original/file-20201215-17-uannmg.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Uber Eats and other food delivery apps charge up to 30 per cent on a food order.</span>
<span class="attribution"><span class="source">(Charles Deluvio/Unsplash)</span></span>
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</figure>
<p>Part of the problem is that the delivery companies aren’t making money either. <a href="https://www.ctvnews.ca/business/foodora-to-shut-down-in-canada-on-may-11-amid-profitability-challenges-1.4913765">Foodora actually pulled out of Canada</a> earlier this year. <a href="https://www.forbes.com/sites/andriacheng/2020/08/06/ubers-biggest-business-is-officially-not-ride-sharing/?sh=312651b46b24">Uber Eats is a bigger business</a> than Uber Rides but is not yet profitable. Asking Uber Eats to discount fees would be asking them to lose more money in order to support the restaurants. </p>
<p>It’s also worth noting that a portion of the delivery fee goes to an independent driver, who’s also a low-wage earner. It’s estimated that <a href="https://www.ridesharingdriver.com/driving-for-ubereats-what-its-like-delivering-food-for-uber/">drivers earn approximately US$8 to $12 an hour</a>, after car expenses, delivering for Uber Eats depending on the market and time of day. </p>
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<strong>
Read more:
<a href="https://theconversation.com/californias-gig-worker-battle-reveals-the-abuses-of-precarious-work-in-canada-too-149780">California's gig worker battle reveals the abuses of precarious work in Canada too</a>
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<p>That means reducing delivery app fees would take money from someone who’s already in a low-income situation.</p>
<p>The real issue is that the business model doesn’t work. </p>
<p>The pricing model doesn’t cover the costs associated with delivering. Delivery apps are trying to build the delivery market, so higher pricing slows growth. It is, however, extremely difficult to raise prices later once people develop an expectation of low delivery costs.</p>
<h2>Now may be the time to raise prices</h2>
<p>Nonetheless it might be worthwhile now to begin building a sustainable pricing model in increments. The value associated with delivery has never been higher, given the reticence to eat in restaurants during the pandemic. It makes sense to start moving prices up slowly to reflect the real cost of these services.</p>
<p>There’s also merit to the idea of app companies and delivery drivers sharing some of the pandemic pain with restaurants. The delivery app model requires restaurants to succeed, after all — without them there is nothing to deliver.</p>
<p>Delivery <a href="https://www.globenewswire.com/news-release/2020/04/30/2025097/0/en/Food-Delivery-Services-See-a-Surge-in-Demand-due-to-Coronavirus-Outbreak-as-Consumers-Stay-at-Home.html">demand has been increasing</a>, so attracting more customers and restaurants should be a strategic priority for these companies. Reducing delivery fees for restaurants is one way to do so.</p>
<p>There have been initiatives by delivery companies to respond to concerns raised by restaurants.</p>
<p>Skip the Dishes instituted a <a href="https://www.skipthedishes.com/coronavirus-updates/supporting-your-communities">rebate program</a> on both takeout and delivery to reduce fees during the pandemic. This helps restaurants in times of crisis, helps Skip the Dishes maintain and grow its customer base and keeps a larger variety of restaurants on the app. </p>
<p>Uber Eats has introduced a <a href="https://www.uber.com/en-CA/newsroom/uber-eats-canada-introduces-delivery-only-option-for-restaurants/">delivery-only function</a> at a reduced service charge. In this case, restaurants take the orders themselves and just use Uber Eats to deliver the food. </p>
<p>This makes sense for restaurants with loyal customers who directly contact them. It allows restaurants to use delivery services without using the app’s ordering infrastructure while delivery companies can continue to employ drivers. </p>
<figure class="align-center ">
<img alt="A man delivers pizzas to an apartment dweller." src="https://images.theconversation.com/files/375442/original/file-20201216-19-3karhv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/375442/original/file-20201216-19-3karhv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/375442/original/file-20201216-19-3karhv.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/375442/original/file-20201216-19-3karhv.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/375442/original/file-20201216-19-3karhv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/375442/original/file-20201216-19-3karhv.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/375442/original/file-20201216-19-3karhv.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Delivery-only options are now available via Uber Eats.</span>
<span class="attribution"><span class="source">(Norma Mortenson/Pexels)</span></span>
</figcaption>
</figure>
<p>Uber Eats has also introduced a <a href="https://thespoon.tech/uber-eats-new-pilot-offers-commission-free-orders-for-restaurants-with-a-catch/">zero commission for pickup orders</a>. In this case, customers order on the app and opt to pick up their meal themselves. This helps restaurants and drives traffic through the app (at a very low marginal cost) while also keeping a wider range of restaurants on the app that may not have otherwise been able to afford the delivery fees.</p>
<p>The restaurant industry needs a long-term, sustainable business model for delivery. But carefully structured and implemented short-term regulations may level the playing field and help restaurants survive this critical period. Flexibility is in everyone’s best interest.</p>
<h2>Caps proposed</h2>
<p>Ontario has proposed caps of <a href="https://news.ontario.ca/en/release/59356/province-proposes-cap-on-delivery-fees-to-support-local-restaurants">15 per cent on delivery</a> (intended to maintain the incomes of the drivers). <a href="https://www.cnbc.com/2020/05/13/nyc-city-council-votes-to-cap-app-delivery-fees-at-15percent.html">New York City</a> and other jurisdictions have already done so. This will help restaurants. </p>
<p>But — pardon the pun — there is no free lunch, and caps will cost delivery companies money. They may be forced to drop restaurants that aren’t generating volumes and are costing too much. There’s also a risk that delivery companies will leave unprofitable or more restrictive markets. That helps no one. Regulation is complex, and the outcomes don’t always reflect what the objective was. </p>
<p>A better approach may be launching delivery-only companies or <a href="https://www.cbc.ca/radio/asithappens/as-it-happens-tuesday-edition-1.5566154/why-this-toronto-restaurateur-is-creating-an-alternative-to-delivery-apps-1.5566441">delivery co-operatives</a>. </p>
<p>For most restaurants, the volume of delivery and the associated cost doesn’t justify a dedicated delivery person. The co-ordination of delivery without the ordering platform could give restaurants a more affordable choice and allow them to maintain the customer relationship. </p>
<p>Innovative thinking along these lines could results in affordable lifelines for some restaurants.</p><img src="https://counter.theconversation.com/content/151631/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michael von Massow receives funding from the Ontario Ministry of Agriculture and Food to research issues in food waste and nutrition labeling for restaurant menus. He has received money from the Tim Hortons Sustainable Food Management Fund to explore consumer attitudes to antibiotic use and animal welfare. </span></em></p>Food delivery apps charge significant fees for orders, meaning restaurants already challenged by the pandemic can be squeezed into negative margins to access customers. Will cutting fees help?Michael von Massow, Associate Professor, Food Economics, University of GuelphLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1507522020-11-26T19:02:43Z2020-11-26T19:02:43ZDelivery rider deaths highlight need to make streets safer for everyone<figure><img src="https://images.theconversation.com/files/371401/original/file-20201125-23-ee8k8m.jpg?ixlib=rb-1.1.0&rect=473%2C540%2C3014%2C2041&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Mahathir Mohd Yasin/Shutterstock</span></span></figcaption></figure><p>Five food-delivery cyclists <a href="https://www.abc.net.au/news/2020-11-24/uber-eats-vows-to-improve-safety-cyclist-killed-in-inner-sydney/12913840">have died</a> on Australian roads in the past three months, four in Sydney. Most commentary has focused on the <a href="https://www.theage.com.au/national/food-delivery-riders-are-the-21st-century-s-chimney-sweeps-20201125-p56htn.html">harsh employment conditions</a> that force people to take risks they shouldn’t have to. These problems should of course be fixed, but cycling in general is too dangerous in our cities. </p>
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Read more:
<a href="https://theconversation.com/three-charts-on-the-rise-in-cycling-injuries-and-deaths-in-australia-116660">Three Charts on the rise in cycling injuries and deaths in Australia</a>
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<p>We need to look not just at labour laws but at the laws that shape our streets: things like road rules, planning requirements and engineering standards. Food delivery is a compelling example because it shows cycling is the most efficient way to get around the city. </p>
<p>Despite the efforts of supposedly business-minded people like shock jock Alan Jones and New South Wales’ former roads minister, Duncan Gay (who infamously ripped up infrastructure including a <a href="https://www.theguardian.com/cities/2015/aug/25/sydney-australia-bike-lane-skeptic-cycling-duncan-gay-cycleways">cycleway along College Road</a> in central Sydney and a <a href="https://www.abc.net.au/news/2013-04-11/government-tears-up-rainbow-crossing/4621896?nw=0">rainbow crossing</a> on Oxford Street in Surry Hills), businesses have worked out bikes are the best way to move around the city. </p>
<p>Bikes are fastest for distances <a href="https://journals.sagepub.com/doi/abs/10.3141/2247-12?casa_token=6vELy3I6legAAAAA:vMzALMcRv95IJtv7HzstBi1F7BhRF_gbZoaFwCZNU9MQmigqh3MsgonjZKJQWLYMvgXLAlT2aZI">up to 5km</a>, even for beginners. For more experienced cyclists and during peak hour, bikes are faster for trips of 10km and often even more. </p>
<p>Cycling has wider benefits too. Swapping cars for bikes can reduce the tens of billions of dollars lost in traffic <a href="https://www.infrastructure.gov.au/cities/smart-cities/plan/index.aspx">congestion</a>, the many gigatonnes of <a href="https://www.ipcc.ch/site/assets/uploads/2018/02/ipcc_wg3_ar5_chapter8.pdf">greenhouse gas emissions</a> and the health impacts of sedentary lifestyles. Even after accidents are taken into account, the <a href="https://www.tandfonline.com/doi/full/10.1080/01441647.2015.1057877">health benefits</a> of cycling far outweigh the costs. </p>
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Read more:
<a href="https://theconversation.com/cycle-walk-drive-or-train-weighing-up-the-healthiest-and-safest-ways-to-get-around-the-city-100238">Cycle, walk, drive or train? Weighing up the healthiest (and safest) ways to get around the city</a>
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<p>Cycling can also <a href="https://theconversation.com/covid-19-cyclists-expanding-bike-lane-network-can-lead-to-more-inclusive-cities-144343">help to improve equity</a> and social inclusion, since the burdens of car-centric development are suffered most by people who are already vulnerable. They include the largely migrant food-delivery workforce. </p>
<p>Food-delivery cyclists are not the only people dying in car crashes. Worldwide, traffic accidents cause more than <a href="https://www.who.int/news-room/fact-sheets/detail/road-traffic-injuries">1.35 million deaths</a> every year and are the leading killer of children. </p>
<h2>Blaming the victims</h2>
<p>Instead of focusing on the dangers created by cars and trucks, however, NSW Transport and Roads Minister Andrew Constance this week <a href="https://www.2gb.com/minister-insists-premiers-critics-clutching-at-straws-over-accusations-of-health-rules-breach/">blamed the victim</a>:</p>
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<p>If people are riding around, particularly at night, they have an obligation to make sure they are wearing high-visibility jackets. They’ve obviously got to have the requisite lighting in terms of the bike. They themselves should obviously be putting protective and high-vis clothes on.</p>
</blockquote>
<p>Before this week, news stories about food-delivery cyclists were mostly negative. Just last month, police announced a <a href="https://www.news.com.au/national/nsw-act/news/sydney-police-crack-down-on-delivery-drivers-who-ride-bikes-on-footpaths/news-story/5c05fc45d6bdca54c607b31e48fae537">crackdown on delivery cyclists</a> riding on footpaths. </p>
<p>Fears about cyclists injuring pedestrians receive a lot of attention, yet car driving <a href="https://theconversation.com/road-safety-switch-to-cycling-to-keep-others-safe-131964">kills three times more people</a> per kilometre than cycling. The danger created by trucks is more than ten times greater per kilometre (and vastly greater overall). </p>
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Read more:
<a href="https://theconversation.com/cars-bicycles-and-the-fatal-myth-of-equal-reciprocity-81034">Cars, bicycles and the fatal myth of equal reciprocity</a>
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<h2>Rules give priority to cars</h2>
<p>Of course, we have all seen cyclists doing risky things. But the issue is less about individual behaviour and more about the regulatory environment. In Sydney and many other places, a plethora of state and federal rules and regulations give priority to cars in our cities. </p>
<p>Planning rules entrench the dominance of cars by <a href="https://theconversation.com/the-elephant-in-the-planning-scheme-how-cities-still-work-around-the-dominance-of-parking-space-87098">mandating the provision of car parking</a> (despite its significant <a href="https://vtpi.org/park-hou.pdf">impact on housing affordability</a>). Engineering standards support high-speed travel. </p>
<p>Road rules and policing practices also enforce the dominance of cars on streets. An example is penalising pedestrians who step onto or cross the road within 20 metres of a zebra crossing. In contrast, sanctions for dangerous driving are weak and <a href="https://www.smh.com.au/national/nsw/furious-cyclists-demand-police-focus-on-dangerous-drivers-not-helmets-20180426-p4zbte.html">poorly enforced</a>, and cycling is <a href="https://www.amygillett.org.au/wp-content/uploads/2015/06/AGF-Submission-to-NSW-Staysafe-Committee-Inquiry-into-Driver-Education-Training-and-Road-Safety-200217.pdf">left out of driver education</a>.</p>
<h2>Infrastructure is a problem too</h2>
<p><a href="https://theconversation.com/cycling-and-walking-can-help-drive-australias-recovery-but-not-with-less-than-2-of-transport-budgets-142176">Lopsided budget allocations</a> and infrastructure make the situation worse. Even projects supposedly aimed at pedestrians and cyclists often benefit cars far more. An example is overpasses that increase walking and cycling distances, while giving cars a smooth, lights-free ride. </p>
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Read more:
<a href="https://theconversation.com/cycling-and-walking-can-help-drive-australias-recovery-but-not-with-less-than-2-of-transport-budgets-142176">Cycling and walking can help drive Australia's recovery – but not with less than 2% of transport budgets</a>
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<p>The challenge is particularly acute in older areas, where streets were not designed for high car use. Calls for bike lanes, widened footpaths and other infrastructure for pedestrians and cyclists are often refused on the grounds of lack of space. But why do cars get what little space there is? </p>
<p>The site of Sunday’s death is a clear example. The intersection where the cyclist was killed by an excavator-carrying truck is not a highway but a relatively narrow street with houses and a school. Should large trucks really be driving on streets like this? </p>
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Read more:
<a href="https://theconversation.com/physical-distancing-is-here-for-a-while-over-100-experts-call-for-more-safe-walking-and-cycling-space-137374">Physical distancing is here for a while – over 100 experts call for more safe walking and cycling space</a>
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<h2>Law reform is overdue</h2>
<p>Internationally, there is a growing recognition that legal reform is needed to improve safety, and in turn to achieve both individual and national benefits. The <a href="https://bicycledutch.wordpress.com/2012/01/02/sustainable-safety/">Dutch approach</a> has long been celebrated, both for the high quality of cycling infrastructure and the <a href="https://theconversation.com/cars-overwhelmingly-cause-bike-collisions-and-the-law-should-reflect-that-78922">high level of liability for car drivers</a>. The Swedish <a href="https://visionzeronetwork.org/">Vision Zero</a> has also been influential, with cities around the world introducing laws and policies to eliminate deaths in traffic. </p>
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Read more:
<a href="https://theconversation.com/cars-overwhelmingly-cause-bike-collisions-and-the-law-should-reflect-that-78922">Cars overwhelmingly cause bike collisions, and the law should reflect that</a>
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<p>Even in the US, where car culture is deeply entrenched, many cities are adopting <a href="https://static1.squarespace.com/static/5ad9018bf93fd4ad7295ba8f/t/5f1f030c0cf14f38fa318020/1595867918978/CityHealth_Complete+Streets+Report.pdf">complete streets</a> legislation. These laws require streets to be planned, designed, operated and maintained to enable safe, convenient and comfortable access for users of all ages and abilities, regardless of their transport mode. </p>
<p>In Australia, councils like the <a href="https://www.cityofsydney.nsw.gov.au/cycling">City of Sydney</a> are taking very positive actions to support cycling, but this alone is not enough. To save the lives of delivery riders – and everyone else – we need legal reforms at the state and federal levels.</p><img src="https://counter.theconversation.com/content/150752/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Amelia Thorpe does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Delivery riders are paying the ultimate price for the fact that our cities, their infrastructure and the rules governing them make cycling much more dangerous than it should be.Amelia Thorpe, Associate Professor in Law, UNSW SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1447242020-08-24T03:35:36Z2020-08-24T03:35:36ZAlgorithms workers can’t see are increasingly pulling the management strings<figure><img src="https://images.theconversation.com/files/353546/original/file-20200819-42970-1qgkka4.jpg?ixlib=rb-1.1.0&rect=0%2C7%2C5000%2C3315&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>“I’m sorry, Dave. I’m afraid I can’t do that.” HAL’s cold, if polite, refusal to open the pod bay doors in <a href="https://theconversation.com/50-years-old-2001-a-space-odyssey-still-offers-insight-about-the-future-102303">2001 A Space Odyssey</a> has become a defining warning about putting too much trust in artificial intelligence, particularly if you work in space. </p>
<p>In the movies, when a machine decides to be the boss – or humans let it – things go wrong. Yet despite myriad dystopian warnings, control by machines is fast becoming our reality. </p>
<p>Algorithms – sets of instructions to solve a problem or complete a task – now drive everything from browser search results to <a href="https://theconversation.com/medical-ai-can-now-predict-survival-rates-but-its-not-ready-to-unleash-on-patients-127039">better medical care</a>. </p>
<p>They are helping <a href="https://theconversation.com/algorithms-are-designing-better-buildings-140302">design buildings</a>. They are <a href="https://theconversation.com/can-slower-financial-traders-find-a-haven-in-a-world-of-high-speed-algorithms-61055">speeding up trading</a> on financial markets, making and losing fortunes in micro-seconds. They are calculating the most efficient routes for <a href="https://www.ups.com/us/en/services/knowledge-center/article.page?kid=aa3710c2">delivery drivers</a>. </p>
<p>In the workplace, self-learning algorithmic computer systems are being introduced by companies to assist in areas such as hiring, setting tasks, measuring productivity, evaluating performance and even terminating employment: “I’m sorry, Dave. I’m afraid you are being made redundant.”</p>
<p>Giving self‐learning algorithms the responsibility to make and execute decisions affecting workers is called “<a href="https://onlinelibrary.wiley.com/doi/full/10.1111/1748-8583.12258">algorithmic management</a>”. It carries a host of risks in depersonalising management systems and entrenching pre-existing biases. </p>
<p>At an even deeper level, perhaps, algorithmic management entrenches a power imbalance between management and worker. Algorithms are closely guarded secrets. Their decision-making processes are hidden. It’s a black-box: perhaps you have some understanding of the data that went in, and you see the result that comes out, but you have no idea of what goes on in between.</p>
<h2>Algorithms at work</h2>
<p>Here are a few examples of algorithms already at work.</p>
<p>At Amazon’s fulfilment centre in south-east Melbourne, they set the pace for “pickers”, who have timers on their scanners showing how long they have <a href="https://www.abc.net.au/news/2019-02-27/amazon-australia-warehouse-working-conditions/10807308?nw=0">to find the next item</a>. As soon as they scan that item, the timer resets for the next. All at a “not quite walking, not quite running” speed. </p>
<p>Or how about AI determining your success in a job interview? More than 700 companies <a href="https://theconversation.com/facial-analysis-ai-is-being-used-in-job-interviews-it-will-probably-reinforce-inequality-124790">have trialled such technology</a>. US developer HireVue says its software speeds up the hiring process by 90% by having applicants answer identical questions and then scoring them according to language, tone and facial expressions.</p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/facial-analysis-ai-is-being-used-in-job-interviews-it-will-probably-reinforce-inequality-124790">Facial analysis AI is being used in job interviews – it will probably reinforce inequality</a>
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<p>Granted, human assessments during job interviews are notoriously flawed. Algorithms, however, can also be <a href="https://journals.sagepub.com/doi/full/10.1177/2053951718756684">biased</a>. The classic example is the COMPAS software used by US judges, probation and parole officers to rate a person’s risk of reoffending. In 2016 a <a href="https://www.propublica.org/article/how-we-analyzed-the-compas-recidivism-algorithm">ProPublica investigation</a> showed the algorithm was heavily discriminatory, incorrectly classifying black subjects as higher risk 45% of the time, compared with 23% for white subjects.</p>
<h2>How gig workers cope</h2>
<p>Algorithms do what their code tells them to do. The problem is this code is rarely available. This makes them difficult to scrutinise, or even understand.</p>
<p>Nowhere is this more evident than in the gig economy. Uber, Lyft, Deliveroo and other platforms could not exist without algorithms <a href="https://journals.aom.org/doi/full/10.5465/annals.2018.0174">allocating, monitoring, evaluating and rewarding</a> work.</p>
<p>Over the past year Uber Eats’ <a href="https://www.news.com.au/finance/work/at-work/40-per-cent-drop-overnight-ubereats-bicycle-riders-say-algorithm-change-preferences-motorbikes-and-cars/news-story/ef3d3a0bc8ee9a7374616b5d2c4a67eb">bicycle couriers</a> and <a href="https://www.twu.com.au/press/survey-shows-ubereats-drivers-struggle-with-bankruptcy-homelessness/">drivers</a>, for instance, have blamed unexplained changes to the algorithm for slashing their jobs, and incomes. </p>
<p>Riders can’t be 100% sure it was all down to the algorithm. But that’s part of the problem. The fact those who depend on the algorithm don’t know one way or the other has a powerful influence on them. </p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/uber-drivers-experience-highlights-the-dead-end-job-prospects-facing-more-australian-workers-116973">Uber drivers' experience highlights the dead-end job prospects facing more Australian workers</a>
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<p>This is a key result from our <a href="https://journals.sagepub.com/doi/full/10.1177/0950017019836911">interviews with 58 food-delivery couriers</a>. Most knew their jobs were allocated by an algorithm (via an app). They knew the app collected data. What they didn’t know was how data was used to award them work.</p>
<p>In response, they developed a range of strategies (or guessed how) to “win” more jobs, such as accepting gigs as quickly as possible and waiting in “magic” locations. Ironically, these attempts to please the algorithm often meant losing the very flexibility that was one the attractions of gig work. </p>
<p>The information asymmetry created by algorithmic management has two profound effects. First, it threatens to entrench systemic biases, the type of discrimination hidden within the COMPAS algorithm for years. Second, it compounds the <a href="https://journals.sagepub.com/doi/10.1177/0308518X20914346">power imbalance</a> between management and worker. </p>
<p>Our data also confirmed others’ findings that it is almost impossible to complain about the decisions of the algorithm. Workers often do not know the exact basis of those decisions, and there’s no one to complain to anyway. When Uber Eats bicycle couriers asked for reasons about their plummeting income, for example, responses from the company advised them “we have <a href="https://www.news.com.au/finance/work/at-work/40-per-cent-drop-overnight-ubereats-bicycle-riders-say-algorithm-change-preferences-motorbikes-and-cars/news-story/ef3d3a0bc8ee9a7374616b5d2c4a67eb">no manual control</a> over how many deliveries you receive”.</p>
<h2>Broader lessons</h2>
<p>When algorithmic management operates as a “black box” one of the consequences is that it is can become an <a href="https://journals.sagepub.com/doi/10.1177/0950017019836911">indirect control mechanism</a>. Thus far under-appreciated by Australian regulators, this control mechanism has enabled platforms to mobilise a reliable and scalable workforce while avoiding <a href="https://www.fwc.gov.au/documents/decisionssigned">employer responsibilities</a>.</p>
<p>“The absence of concrete evidence about how the algorithms operate”, the Victorian government’s <a href="https://s3.ap-southeast-2.amazonaws.com/hdp.au.prod.app.vic-engage.files/4915/9469/1146/Report_of_the_Inquiry_into_the_Victorian_On-Demand_Workforce-reduced_size.pdf">inquiry into the “on-demand” workforce</a> notes in its report, “makes it hard for a driver or rider to complain if they feel disadvantaged by one.”</p>
<p>The report, published in June, also found: it is “hard to confirm if concern over algorithm transparency is real.” </p>
<p>But it is precisely the fact it is hard to confirm that’s the problem. How can we start to even identify, let alone resolve, issues like algorithmic management? </p>
<p>Fair conduct standards to ensure transparency and accountability are a start. One example is the <a href="https://fair.work">Fair Work initiative</a>, led by the <a href="https://www.oii.ox.ac.uk/">Oxford Internet Institute</a>. The initiative is bringing together researchers with platforms, workers, unions and regulators to develop global principles for work in the platform economy. This includes “fair management”, which focuses on how transparent the results and outcomes of algorithms are for workers. </p>
<p>Understandings about impact of algorithms on all forms of work is still in its infancy. It demands greater scrutiny and research. Without human oversight based on agreed principles we risk inviting HAL into our workplaces.</p><img src="https://counter.theconversation.com/content/144724/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Tom Barratt is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project.</span></em></p><p class="fine-print"><em><span>Alex Veen is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project</span></em></p><p class="fine-print"><em><span>Caleb Goods is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project.</span></em></p>Handing management to algorithms creates ‘black-box bosses" whose decision-making is hard to understand or question.Tom Barratt, Lecturer, School of Business and Law, Edith Cowan UniversityAlex Veen, Lecturer (Academic Fellow) in Work and Organisational Studies, University of SydneyCaleb Goods, Lecturer - Management and Organisations, UWA Business School, The University of Western AustraliaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1378432020-05-11T17:33:42Z2020-05-11T17:33:42ZCould Covid-19 be the push that Europe needs for unconditional basic income?<figure><img src="https://images.theconversation.com/files/332434/original/file-20200504-83725-1uwqe90.jpg?ixlib=rb-1.1.0&rect=0%2C13%2C1500%2C1010&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">"Gig workers" such as those who deliver food and other packages could benefit from a universal basic income (UBI). </span> <span class="attribution"><a class="source" href="https://ccsearch.creativecommons.org/photos/74265c64-7025-4304-ad08-89431c642544">Pierre Arronax/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span></figcaption></figure><p>As the wide-ranging implications of the coronavirus pandemic become clear, renewed calls have been made – by <a href="https://www.independent.co.uk/voices/letters/coronavirus-universal-basic-income-ubi-poverty-economy-business-migrants-a9408846.html">academics</a>, <a href="https://www.ft.com/content/7eff769a-74dd-11ea-95fe-fcd274e920ca">economists</a> and politicians <a href="https://www.thersa.org/discover/publications-and-articles/rsa-blogs/2020/05/ubi-basic-income-covid">left</a> and <a href="https://www.cnbc.com/2020/03/16/coronavirus-stimulus-romney-proposes-1000-for-every-american.html">right</a> – for an unconditional basic income (UBI) that would guarantee individuals regular payments, from the state, regardless of their economic activity. Beyond its <a href="https://theconversation.com/money-for-nothing-has-the-time-come-for-universal-basic-income-71348">potential benefits</a> in normal times, there are suggestions that UBI could mitigate some of the most worrying effects of the pandemic. A guaranteed income could <a href="https://www.ft.com/content/927d28e0-6847-11ea-a6ac-9122541af204">provide relief</a> to the self-employed and small businesses that are difficult to reach through traditional policy instruments. Direct cash transfers are proposed to address precipitous <a href="https://www.euronews.com/2020/04/17/from-basic-income-to-fiscal-stimuli-the-covid-19-response-may-see-economic-paradigm-view">drops in consumer spending</a>, thereby cushioning the economic impact of the crisis.</p>
<p>A UBI might also limit and slow the spread of the virus. <a href="https://www.ids.ac.uk/opinions/precarious-and-informal-work-exacerbates-spread-of-coronavirus/">Economists</a> and <a href="https://www.theguardian.com/commentisfree/2020/mar/19/coronavirus-insecurity-anxiety-us-epidemic">epidemiologists</a> alike argue that by alleviating income insecurity, a UBI could enhance compliance with social distancing, especially among <a href="https://www.theguardian.com/commentisfree/2020/mar/03/self-isolation-gig-economy-workers-coronavirus-quarantine">precarious</a> employees and so-called <a href="https://www.theguardian.com/world/2020/mar/06/coronavirus-outbreak-gig-workers-risk-sick-leave">“gig workers”</a>.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/326174/original/file-20200407-147360-1055vhz.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/326174/original/file-20200407-147360-1055vhz.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=304&fit=crop&dpr=1 600w, https://images.theconversation.com/files/326174/original/file-20200407-147360-1055vhz.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=304&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/326174/original/file-20200407-147360-1055vhz.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=304&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/326174/original/file-20200407-147360-1055vhz.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=382&fit=crop&dpr=1 754w, https://images.theconversation.com/files/326174/original/file-20200407-147360-1055vhz.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=382&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/326174/original/file-20200407-147360-1055vhz.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=382&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Table 1: Percentage of population supporting or strongly supporting the implementation of a basic income system in their country in 2016.</span>
<span class="attribution"><span class="source">Shanahan, Smith and Srinivasan (2020)</span></span>
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</figure>
<p>Last year, we <a href="https://www.springer.com/gp/book/9783030300432">analysed the feasibility</a> of a UBI in Europe and concluded that, while important steps had been taken, for such policies to be successfully implemented changes would be necessary in terms of public support, institutional alignment, evidence of effects and clarity of political purpose. Here we investigate whether Covid-19 is triggering such change.</p>
<h2>The elements of feasibility</h2>
<p>A 2016 <a href="https://theconversation.com/survey-reveals-young-people-more-likely-to-support-universal-basic-income-but-its-not-a-left-right-thing-87554">European Social Survey</a> showed quite high support for UBI across European countries, detailed in Table 1 above. Surprisingly, however, the highest public backing was in Lithuania, Hungary and Slovenia – countries we found to have few if any concrete proposals regarding UBI. This points to an important disconnect between popularity and political feasibility.</p>
<p>Political feasibility concerns whether current social conditions are conducive to a proposed policy. Political theorists <a href="https://www.researchgate.net/publication/304799382_On_the_Political_Feasibility_of_Universal_Basic_Income_An_Analytic_Framework">De Wispelaere and Noguera (2012)</a> explain that feasibility depends on four subtypes:</p>
<ul>
<li><p>Institutional: Would the policy achieve its aims within the existing institutional framework?</p></li>
<li><p>Strategic: Are key political actors on board and willing to commit resources to implement the policy?</p></li>
<li><p>Psychological: Does the general public support the policy?</p></li>
<li><p>Behavioural: Would the policy establish behavioural incentives coherent with its aims?</p></li>
</ul>
<h2>Institutional and strategic feasibility</h2>
<p>Existing welfare frameworks in Europe are much more aligned with UBI than in, for instance, the United States, but variation nevertheless exists across Europe in this regard. Nordic countries’ welfare regimes are more generous and aligned with the key <a href="https://basicincome.org/basic-income/">features of UBI</a> as compared to Central and Eastern European countries. This institutional alignment influences the degree to which political actors are willing to commit resources to exploration and implementation of UBI. Our analysis of the relative degree of development of basic income initiatives across European welfare regimes is summarized in Table 2. Notably, even in the absence of particularly strong public support for UBI policies, countries like <a href="https://basicincome.org/news/2019/03/germany-the-hartzplus-experiment-is-starting-and-the-basic-income-discussion-is-there-to-stay/">Germany</a> and the <a href="https://www.utrecht.nl/city-of-utrecht/study-on-rules-in-social-assistance/">Netherlands</a> are taking steps to test proposals.</p>
<p><strong>Basic income initiatives by stage of development in the European Union</strong></p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/332430/original/file-20200504-83751-1fs18xs.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/332430/original/file-20200504-83751-1fs18xs.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=248&fit=crop&dpr=1 600w, https://images.theconversation.com/files/332430/original/file-20200504-83751-1fs18xs.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=248&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/332430/original/file-20200504-83751-1fs18xs.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=248&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/332430/original/file-20200504-83751-1fs18xs.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=311&fit=crop&dpr=1 754w, https://images.theconversation.com/files/332430/original/file-20200504-83751-1fs18xs.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=311&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/332430/original/file-20200504-83751-1fs18xs.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=311&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Table 2: Basic income initiatives by stage of development in the 28 EU member states, January 2016 to March 2019.</span>
<span class="attribution"><span class="source">Shanahan, Smith and Srinivasan (2020)</span>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>One key barrier to implementing UBI is the <a href="https://www.ft.com/content/cf63e08e-725f-11e9-bbfb-5c68069fbd15">high sticker price</a> of the policy’s distinguishing features, especially its lack of means-testing. While <a href="https://www.weforum.org/agenda/2017/01/why-we-should-all-have-a-basic-income/">advocates argue</a> that the difference in cost between a UBI and means-tested benefits would be recouped through modifying the tax system and lower administrative costs, strong political will is necessary to take the leap. The effect of the coronavirus pandemic is most clear here, as governments are under intense pressure to do <a href="https://theconversation.com/coronavirus-why-the-uk-needs-a-basic-income-for-all-workers-134257">“whatever it takes”</a> to avoid an economic depression. Economists are calling for quick, administratively simple measures to <a href="https://www.ft.com/content/abd6bbd0-6a9f-11ea-800d-da70cff6e4d3">“get money into everybody’s hands”</a>, and so we are seeing initiatives that indeed eschew stringent <a href="https://read.oecd-ilibrary.org/view/?ref=119_119686-962r78x4do&title=Supporting_people_and_companies_to_deal_with_the_Covid-19_virus">means-testing</a>.</p>
<p>For example, in <a href="https://www.oireachtas.ie/en/debates/debate/dail/2020-04-02/5/">Ireland</a>, a Covid-19 unemployment payment has been made available by the government to those who have lost their jobs due to the pandemic, with fewer restrictions, less stringent means testing and thus a much shorter waiting period than for ordinary unemployment benefits. Similar measures have been implemented in <a href="https://www.nytimes.com/2020/04/03/world/europe/coronavirus-Berlin-self-employed.html">Berlin</a> and are planned in, for instance, <a href="https://www.france24.com/en/20200419-in-europe-covid-19-puts-idea-of-universal-income-back-into-welfare-debate">Spain</a>.</p>
<p>While these are temporary measures, some political leaders – including the <a href="https://www.thejournal.ie/dail-emergency-legislation-5058234-Mar2020/">Irish Prime Minister</a> and the <a href="https://www.euronews.com/2020/04/17/universal-basic-income-will-it-become-a-reality-after-lockdown-is-lifted">Spanish minister of social security</a> – have suggested that we will not revert entirely to the former status quo after the pandemic is brought under control. And although these initiatives cannot be called pure UBI policies, they do establish a <a href="https://www.nytimes.com/2020/03/06/business/europe-coronavirus-labor-help.html">welfare framework</a> closer to UBI than before, thereby enhancing the institutional feasibility of the policy.</p>
<h2>Psychological and behavioural feasibility</h2>
<p>The psychological feasibility of UBI is tied to populations’ perceptions of its_ <em>behavioural feasibility</em>, that is, what effects people expect a guaranteed income to have on others’ behaviour. A common concern regarding UBI is that it would act as a work disincentive. While <a href="https://www.sciencedirect.com/science/article/abs/pii/S0304387818306084?via%3Dihub">initial</a> <a href="https://www.bath.ac.uk/publications/exploring-the-distributional-work-incentive-effects-of-plausible-illustrative-basic-income-schemes/attachments/Luke_WP2_Web.pdf">research</a> suggests people do not generally give up work in response to receiving a UBI, and <a href="https://www.ft.com/content/92ad59c2-4f5d-11e6-88c5-db83e98a590a">economists</a> theorise potential positive effects on work participation by mitigating <a href="https://www.ft.com/content/3b7938e6-c569-11e7-b30e-a7c1c7c13aab">welfare traps</a>, it is not yet clear what effects such a policy would have on <a href="http://autonomy.work/wp-content/uploads/2018/07/The-Desire-For-Work-As-An-Adaptive-Preference-V2-.pdf">work preferences</a> in the longer term.</p>
<p>The <a href="https://www.kela.fi/web/en/basic-income-objectives-and-implementation">Finnish UBI trial</a>, perhaps the most high-profile basic income experiment to date, was thus <a href="https://www.theguardian.com/world/2019/feb/08/finland-free-cash-experiment-fails-to-boost-employment">criticized</a> because it did not maximise labour activation. Yet work activation is not the <a href="https://www.theguardian.com/commentisfree/2020/may/03/universal-basic-income-coronavirus-shocks">only reason</a> we might want a guaranteed income scheme, with [<a href="https://www.newscientist.com/article/2242937-universal-basic-income-seems-to-improve-employment-and-wellbeing/">positive effects on well being</a>]) one proven outcome. One of the <a href="https://helda.helsinki.fi/handle/10138/167728">designers</a> of the Finnish study indeed argued that UBI might be seen as a tool “to reduce the supply of labour and in this way allow more equal distribution of work and wealth and provide people with participatory opportunities outside paid work.” It is important, then, to consider what people consider the <a href="https://www.academia.edu/38154431/From_Rights_to_Activation_The_Evolution_of_the_Idea_of_Basic_Income_in_the_Finnish_Political_Debate_1980_2016">purpose of UBI</a>: whether to incentivise employment or facilitate a transformation of the role of employment in society altogether.</p>
<p>A striking effect of the crisis is how it is already changing our view of the purpose of state benefits. When the former UK Secretary of State for Work and Pensions criticised coronavirus income support, claiming it would act as a <a href="https://www.independent.co.uk/news/uk/politics/coronavirus-uk-update-universal-basic-income-iain-duncan-smith-a9411251.html">“disincentive to work”</a>, commentators were quick to note that, in this case, work disincentive is <a href="https://www.theguardian.com/commentisfree/2020/mar/26/universal-basic-income-help-self-employed">precisely the point</a>. Today, many workers are being <a href="https://www.nytimes.com/2020/03/06/business/europe-coronavirus-labor-help.html">“paid to stay home”</a> for the sake of public health.</p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/332435/original/file-20200504-83736-1gmhs74.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/332435/original/file-20200504-83736-1gmhs74.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=902&fit=crop&dpr=1 600w, https://images.theconversation.com/files/332435/original/file-20200504-83736-1gmhs74.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=902&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/332435/original/file-20200504-83736-1gmhs74.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=902&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/332435/original/file-20200504-83736-1gmhs74.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1134&fit=crop&dpr=1 754w, https://images.theconversation.com/files/332435/original/file-20200504-83736-1gmhs74.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1134&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/332435/original/file-20200504-83736-1gmhs74.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1134&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption"></span>
<span class="attribution"><a class="source" href="https://www.springer.com/gp/book/9783030300432">Springer</a></span>
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</figure>
<p>As the pandemic forces <a href="https://www.euronews.com/2020/04/22/the-eu-s-100-billion-euro-scheme-to-tackle-unemployment-caused-by-covid-19">vast swathes</a> of the workforce to depend on state income support for the first time, we might expect an erosion of psychological barriers to accepting <a href="https://www.jacobinmag.com/2019/12/basic-income-finland-experiment-kela">“handouts”</a>. A rethinking of the meaning of transfers is thus possible. Perhaps this opens the door to considering other social purposes of a UBI, such as allowing citizens the time to <a href="https://www.vox.com/future-perfect/2020/3/24/21188779/mutual-aid-coronavirus-covid-19-volunteering">care for one another</a>, and <a href="https://www.theguardian.com/commentisfree/2019/feb/12/universal-basic-income-work-finland-experiment-payments">reducing activity</a> that harms the <a href="https://www.bbc.com/future/article/20200326-covid-19-the-impact-of-coronavirus-on-the-environment">environment</a>.</p>
<h2>Crisis and opportunity</h2>
<p>Naomi Klein’s 2007 book <a href="http://tsd.naomiklein.org/shock-doctrine/the-book"><em>The Shock Doctrine</em></a> demonstrated how <a href="https://theconversation.com/deregulation-and-standards-after-brexit-what-naomi-kleins-disaster-capitalism-can-tell-us-124908">moments of crisis</a> have been used as opportunities to push through inequality-exacerbating policies. She <a href="https://theintercept.com/2020/03/16/coronavirus-capitalism/">now highlights</a> the potential for the opposite: to harness the urgency and political will a crisis like Covid-19 generates to rethink our social and economic systems and take bold action. Klein notes that “in times of crisis, seemingly impossible ideas suddenly become possible.” Our analysis suggests that UBI is one such idea.</p>
<hr>
<p><em>Priya Srinivasan contributed to this article.</em></p><img src="https://counter.theconversation.com/content/137843/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Les auteurs ne travaillent pas, ne conseillent pas, ne possèdent pas de parts, ne reçoivent pas de fonds d'une organisation qui pourrait tirer profit de cet article, et n'ont déclaré aucune autre affiliation que leur organisme de recherche.</span></em></p>To achieve universal basic income, changes would be needed in terms of public and political support. Could the Covid-19 pandemic turn the tide?Genevieve Shanahan, Etudiante PhD, Grenoble École de Management (GEM)Mark Smith, Dean of Faculty & Professor of Human Resource Management, Grenoble École de Management (GEM)Licensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1344062020-03-29T19:12:27Z2020-03-29T19:12:27ZDelivery workers are now essential. They deserve the rights of other employees<p>Along with home delivery of <a href="https://insidefmcg.com.au/2020/03/26/woolworths-boosts-online-deliveries-through-41-priority-hubs/">groceries</a>, <a href="https://theconversation.com/coronavirus-how-to-access-the-medicines-you-and-your-family-need-134231">pharmaceuticals</a> and <a href="https://www.businessinsider.com.au/alcohol-australia-coronavirus-2020-3">alcohol</a>, demand for food delivery is booming. </p>
<p>Services such as Uber Eats and Deliveroo have become essential to cafes and restaurants that can now only sell takeaway food. </p>
<p>It is good news for the likes of Uber, whose stock price has risen since it announced a ten-fold increase in the number of restaurants signing themselves up to <a href="https://au.finance.yahoo.com/news/uber-eats-growth-coronavirus-delivery-140101683.html">Uber Eats</a>.</p>
<p>But it’s a situation that has provoked serious questions. Not only about whether delivery services are safe, but <a href="https://www.abc.net.au/radionational/programs/godforbid/the-covid-19-conundrum/12095750">whether it’s ethical to use them</a>.</p>
<p>Digital platforms like Uber Eats and Menulog are not, after all, ideal employers. In fact, they don’t regard themselves as employers at all, merely facilitators of work by “independent contractors”. </p>
<p>Food delivery drivers and riders often work for <a href="https://www.theguardian.com/australia-news/2019/nov/20/food-delivery-bike-couriers-in-australia-being-underpaid-by-up-to-322-a-week">less than the minimum wage</a>, and have no employee rights such as sick leave.</p>
<p>Now we are collectively relying on them to provide an essential service during social distancing, we need to ask what, as a society, we owe these workers in return.</p>
<h2>Vulnerable to exploitation</h2>
<p>We’re interested in how this economic crisis affects food delivery drivers and riders due to our research into the experience of migrant gig workers.</p>
<p>Our research has found migrants are already “socially distanced”, without deep networks of family or friends. They are vulnerable to exploitation and discrimination. </p>
<p>Most food delivery work is done by migrants, through third-party digital platforms like Uber Eats and Menulog. The platforms treat drivers and riders as independent contractors, not employees with the protections and rights of employees.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/redefining-workers-in-the-platform-economy-lessons-from-the-foodora-bunfight-107369">Redefining workers in the platform economy: lessons from the Foodora bunfight</a>
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</em>
</p>
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<p>A 2019 survey <a href="https://www.premier.vic.gov.au/revealing-the-true-size-of-australias-gig-workforce/">commissioned by the Victorian government</a> suggested about 7% of the workforce used digital platforms to get gig work, the most common being Airtasker (35%), Uber (23%), Freelancer (12%), Uber Eats (11%) and Deliveroo (8%). </p>
<p>Previous research suggests <a href="https://theconversation.com/the-way-they-manipulate-people-is-really-saddening-study-shows-the-trade-offs-in-gig-work-79042">many choose gig work</a> simply because it is better than other forms of low-paid work.</p>
<p>Now food delivery workers face pressure from those displaced from such jobs in hospitality or retail. Complicating the situation is the lack of clarity about whether those on temporary work visas are <a href="https://www.theguardian.com/business/2020/mar/22/what-australias-189bn-coronavirus-economic-rescue-package-means-for-you">eligible for income support</a> announced for other workers.</p>
<p>Platforms don’t owe gig workers a minimum wage so can sign up as many “independent contractors” as they like. This improves the service for customers, and increases profit for the platform, but means individual deliverers make less money.</p>
<h2>Increased health risks</h2>
<p>Many delivery services are <a href="https://www.huffingtonpost.com.au/entry/coronavirus-australia-uber-eats-deliveroo-drive-thru_au_5e71a846c5b63c3b6486e11a">implementing contactless delivery</a> procedures. But the lack of defined employer responsibility in the platform economy means patchy attention to the extra physical and mental health risks gig workers now face. </p>
<p>Unions and others have urged delivery platforms <a href="https://www.abc.net.au/news/science/2020-03-06/gig-economy-workers-uber-deliveroo-ola-coronavirus-outbreak/12022072">to provide protective equipment</a> such as gloves, face masks and sanitisers. Responses from platforms have been limited. </p>
<p>This was Uber Eats’ response on March 17, by its regional general manager for the Asia Pacific, <a href="https://www.uber.com/en-AU/newsroom/covid19aus/">Jodie Auster</a>:</p>
<blockquote>
<blockquote>
<p>Our plan to address challenges born by COVID-19 includes making A$5 million in funding available for independent restaurants across Australia and New Zealand. The multi-million dollar fund will allow restaurants to deploy promotions to attract customers and will help restaurants time promotions to suit their individual business needs. </p>
</blockquote>
</blockquote>
<p>What Auster didn’t mention was a plan to issue safety gear, though she did note the company had started a campaign “reminding Uber Eats users that they can request deliveries be left on their doorsteps”.</p>
<p>Not surprisingly, delivery workers are scared <a href="https://www.abc.net.au/radionational/programs/drive/union-seeking-protections-for-delivery-drivers/12094366">they will catch the coronavirus</a>.</p>
<p>Uber says it will financially assist drivers and riders “diagnosed with COVID-19 or placed in quarantine by a public health authority” for a period of <a href="https://www.uber.com/en-AU/newsroom/covid19aus/">up to 14 days</a>. </p>
<p>But what if a worker with viral symptoms wants to self-isolate as a precaution? There’s no sick leave or workers compensation, and they risk “deactivation” if work isn’t accepted.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/workers-compensation-doesnt-cover-gig-workers-heres-a-way-to-protect-them-99946">Workers' compensation doesn't cover gig workers – here's a way to protect them</a>
</strong>
</em>
</p>
<hr>
<h2>Legal protection</h2>
<p>Social distancing measures mean the delivery economy and the health of the general population are now intimately linked.</p>
<p>To secure and safeguard this now essential service, it is time the law ensured gig workers have the same legal rights and protections as other employees.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/how-to-stop-workers-being-exploited-in-the-gig-economy-103673">How to stop workers being exploited in the gig economy</a>
</strong>
</em>
</p>
<hr>
<p>We need the delivery drivers coming to our doors to be healthy. That health depends on their safety as well as <a href="https://www.theguardian.com/world/2020/mar/18/food-ordering-safe-ethical-coronavirus-with-seamless-uber-eats-should-i-get-takeaway">economic and social inclusion</a>.</p><img src="https://counter.theconversation.com/content/134406/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Tyler Riordan receives funding from an Australian Government Research Training Program (RTP) Scholarship. </span></em></p><p class="fine-print"><em><span>Emma Pryor, Gerhard Hoffstaedter, and Richard Robinson do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Food delivery workers are now essential workers. But they’re still not treated as employees.Tyler Riordan, PhD Candidate, The University of QueenslandGerhard Hoffstaedter, Associate professor, The University of QueenslandRichard Robinson, Research Fellow/Hospitality Management, The University of QueenslandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1294732020-01-09T10:03:38Z2020-01-09T10:03:38ZJust Eat’s £6 billion takeover: can anyone actually make big money from online takeaway?<figure><img src="https://images.theconversation.com/files/309043/original/file-20200108-107204-14v9xdg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Not hot?</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/food-delivery-concept-top-view-on-1098517169">Tetuana Shumbasova</a></span></figcaption></figure><p>Takeaway.com, the Dutch-based online food ordering giant, is shortly to be confirmed as the winner in the bidding war for British rival Just Eat in a £6 billion deal, according to <a href="https://www.thetimes.co.uk/article/takeaway-com-on-course-to-acquire-just-eat-in-6bn-deal-btmzglkp8">reports in the media</a>. If alternative bidder Prosus/Naspers is defeated when Just Eat shareholders make their decision by the January 10 deadline, it will bring the curtain down on a takeover drama that has seen numerous raised offers since last summer. </p>
<p>In choosing Takeaway.com, Just Eat’s shareholders will be opting to stick to a similar business model. It means a merger in which they “stay in the game” rather than walk away, avoiding the certainty of an exit but also the tax charge that would come with it. Will this prove to have been the right decision? Take a closer look at the the business of online food delivery and it’s easy to wonder if anyone will ever make long-term significant returns. </p>
<p>The UK takeaway delivery market is said to be one of the largest in the world, turning around <a href="https://www.statista.com/topics/4679/food-delivery-and-takeaway-market-in-the-united-kingdom-uk/">over £6 billion</a> worth of orders each year. Just Eat was an early mover in online ordering, founded in Copenhagen in 2001 and launching in the UK in 2006. It rapidly became profitable and experienced high levels of growth. It still <a href="https://www.businessofapps.com/data/deliveroo-statistics/">comfortably leads</a> the market in the UK, <a href="https://www.proactiveinvestors.co.uk/companies/news/198894/deliveroo-vs-just-eat-is-the-market-big-enough-to-accommodate-both-198894.html">albeit with a percentage share</a> that is only in the mid-teens, and also operates in a dozen other countries including the US and Canada. </p>
<p>The UK market became highly competitive with the arrival of the likes of Deliveroo and Uber Eats in the 2010s, echoing a rise in takeaway apps across the world. Both companies are well funded by venture capital, so they can run high levels of losses. <a href="https://www.thisismoney.co.uk/money/markets/article-6777443/Takeaway-wars-eating-food-ordering-space-Just-Eat-deliver.html">Competing with</a> them has weakened <a href="https://www.justeatplc.com/investors/financials/five-year-summary">Just Eat’s profitability</a>, which is partly why it <a href="https://www.proactiveinvestors.co.uk/companies/news/212974/just-eat-seen-as-possible-takeover-target-as-takeaway-delivery-sector-consolidates-212974.html">became a</a> takeover target in the first place. It needs deeper pockets and mass to withstand the war of attrition that is taking place. </p>
<h2>Model vs model</h2>
<p>There are two main business models in this space, though they have blurred more recently. Just Eat and Takeaway.com, the market leader in the Netherlands and Belgium, built their businesses purely around their apps, leaving home delivery to the restaurants. The alternative model, favoured by Uber Eats and Deliveroo, is to do deliveries as well – using self-employed drivers and cyclists as part of the so-called <a href="https://www.lawcareers.net/Explore/CommercialQuestion/Travers-Smith-LLP-The-gig-economy-Uber-and-Deliveroo">gig economy</a>. </p>
<p>Both models rely on what are sometimes known as <a href="https://www.investopedia.com/terms/n/network-effect.asp">network effects</a>, where one client base helps to grow another. So in the Just Eat/Takeaway.com model, attracting more restaurants helps you to attract more customers and vice versa. In the Deliveroo/Uber Eats model, you add a third dimension to this virtuous circle in the form of delivery people. </p>
<p>This approach is clearly more convenient for restaurants who don’t have their own delivery service. Fearing that this would damage its business, Just Eat made a substantial investment several years ago to move into deliveries itself. Yet this model has yet to turn a profit for anyone. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/309046/original/file-20200108-107214-vpix7s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/309046/original/file-20200108-107214-vpix7s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/309046/original/file-20200108-107214-vpix7s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/309046/original/file-20200108-107214-vpix7s.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/309046/original/file-20200108-107214-vpix7s.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/309046/original/file-20200108-107214-vpix7s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/309046/original/file-20200108-107214-vpix7s.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/309046/original/file-20200108-107214-vpix7s.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">This year’s model.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/food-delivery-concept-top-view-on-1098517169">Nabil Imran</a></span>
</figcaption>
</figure>
<p>For Uber Eats, every US$2 (£1.53) of revenue generated <a href="https://on.ft.com/2QAKSuB">is believed to</a> create US$3 of cost. Total losses for 2018 are in excess of <a href="https://techcrunch.com/2019/11/04/ubers-losses-top-1-billion-trumping-better-than-expected-revenues/">US$1 billion</a>. Deliveroo runs a similar ratio of <a href="https://venturebeat.com/2019/10/02/deliveroo-lost-284-million-in-2018-amid-bruising-food-delivery-battle/">losses to revenue</a>. In both cases, they are subsidising the service in an attempt to achieve a more powerful position in the market. At that point, they will try to raise delivery fees or prevail upon restaurants to fund the difference. </p>
<p>The problem is that restaurants are <a href="https://www.nav.com/blog/96-profit-in-the-restaurant-business-5342/">generally</a> low-margin operations, so there isn’t much room for negotiation. At the same time, we are currently living through a false market because of artificially suppressed prices increasing demand. When prices go up, demand will fall.</p>
<p>As a consequence, this model is always likely to produce low profits at the very best. Customers in high-density cities like London or New York might pay a premium for the service, but in provincial cities with lower income per head and where the delivery service has to travel further, the economics look very challenging. </p>
<p>By moving into deliveries, Just Eat has <a href="https://static1.squarespace.com/static/5c13f4c6e17ba3aca12b9686/t/5c169a11352f53eec9692697/1544985105956/Cat+Rock+Letter+to+Just+Eat+plc+Board+of+Directors+12-17-18.pdf">diluted its profits</a> and exposed itself to all the difficulties with this business model. Somewhat belatedly, Uber Eats and Deliveroo have started offering an app-only service to restaurants as well. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/309050/original/file-20200108-107224-154g8kg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/309050/original/file-20200108-107224-154g8kg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/309050/original/file-20200108-107224-154g8kg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/309050/original/file-20200108-107224-154g8kg.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/309050/original/file-20200108-107224-154g8kg.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/309050/original/file-20200108-107224-154g8kg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/309050/original/file-20200108-107224-154g8kg.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/309050/original/file-20200108-107224-154g8kg.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">What it amounts to?</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/waste-foam-tray-plastic-garbage-food-1029236062">DeawSS</a></span>
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<p>Incidentally, when the artificial phase of this market ends it will also hurt many restaurants. The dominant online services will divert trade to restaurants that pay them more, through coupons and promotions. We’ll probably also see more and more “dark kitchens”: takeaway food factories usually operating out of industrial estates, using bigger premises to be able to make higher profits by producing greater volumes of food. These, too, will threaten high-street restaurants, whether set up by independent entrepreneurs or <a href="https://www.bbc.co.uk/news/business-47978759">by the food app companies</a> themselves. </p>
<h2>The threat of Amazon</h2>
<p>As if Just Eat didn’t have enough to deal with, one other worry is having to compete with Amazon, which <a href="https://www.telegraph.co.uk/technology/2019/05/17/amazon-close-buying-stake-deliveroo/">took a minority stake</a> in Deliveroo last year. On this front at least, Just Eat shareholders received a Christmas present in the form of an <a href="https://www.theguardian.com/business/2019/dec/27/amazon-deliveroo-inquiry-regulator-london-food">announcement</a> from the UK’s competition regulator in late December that the move is being referred to a full review. This means Amazon is unlikely to be allowed to buy, fund or control an existing player in a number of food delivery markets. </p>
<p>It also suggests the door is being closed on further consolidation in the sector. This means that Just Eat/Takeaway.com is less likely to wake up to the news, say, that Deliveroo and Uber Eats have merged. On the other hand, it also reduces the prospect of Takeaway.com/Just Eat shareholders being able to sell out to a competitor. When the results of the probe are announced in June, everyone in the sector will be watching very closely indeed.</p><img src="https://counter.theconversation.com/content/129473/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>John Colley does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>This might be the craziest game in venture capitalism.John Colley, Professor of Practice, Associate Dean, Warwick Business School, University of WarwickLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1272342019-11-27T18:41:52Z2019-11-27T18:41:52ZUber might not take over the world, but it is still normalising job insecurity<p>The <a href="https://www.abc.net.au/news/2019-11-26/uber-banned-from-london-could-be-happening-in-australia/11739178">effective exclusion of Uber from London</a>, one of the digital platform’s most lucrative markets, adds to a small but significant list of places putting up roadblocks to “uberisation”. </p>
<p>Governments in Bulgaria, China, Denmark, Hungary and Australia’s Northern Territory have all made conditions hostile to Uber. There are partial bans in Finland, France, Germany, Italy and the Netherlands.</p>
<p>Specific reasons for the bans differ. In the case of London it is thousands of cases of unauthorised, uninsured drivers using verified driver accounts to pick up passengers. </p>
<p>Behind safety concerns, though, is also a deep resentment towards Uber itself circumventing regulations. This has led, in 2016 and 2014, to thousands of drivers of London’s traditional black cabs jamming the city <a href="https://www.abc.net.au/news/2016-02-11/london-black-cab-drivers-block-streets-in-uber-protest/7158214">in protest</a>. </p>
<p>Uberisation refers to the use of a computing platform to facilitate transactions between service providers and customers, often bypassing a traditional organisational intermediary. Uber pioneered this in “ride-sharing” and has pushed aggressively into food delivery. Its most controversial bypass is the traditional employment relationship.</p>
<p>This is epitomised by the case of Amita Gupta, the Australian Uber Eats driver fired for being <a href="https://www.smh.com.au/business/workplace/uber-eats-driver-sacked-for-being-10-minutes-late-seeks-tribunal-appeal-20191115-p53b2f.html">ten minutes late</a> in delivering a food order. Gupta’s claim of unfair dismissal was rejected by Australia’s federal Fair Work Commission on the basis she was an independent contractor, not an employee, and therefore not covered by the protections of Australia’s Fair Work Act. (She is now appealing to the <a href="https://www.smh.com.au/business/workplace/uber-eats-drivers-only-free-to-negotiate-a-lower-rate-of-pay-20191118-p53bnn.html">full bench of the Fair Work Commission</a>.)</p>
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<a href="https://theconversation.com/how-to-stop-workers-being-exploited-in-the-gig-economy-103673">How to stop workers being exploited in the gig economy</a>
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<p>The good news, as the London ban on Uber signals, is that uberisation is not an unstoppable force. For all its attractions to companies keen to hire labour while circumventing costly labour laws, it is destined to clash with the controls required to keep capitalism ticking over. </p>
<p>That’s no cause for complacency, though, because even if uberisation has its limits, we are seeing the apparent normalisation of all forms of precarious and insecure work.</p>
<h2>The revolution that never happened</h2>
<p>In 2015, with a crush of Uber-inspired startups rushing to market, <a href="https://www.huffingtonpost.ca/2015/04/01/uberization-uber-of-everything_n_6971752.html">a Huffington Post article</a> predicted the combination of “realtime data, mobile payments, instant gratification and dynamic pricing” was the beginning of “an on-demand revolution that will ‘Uberize’ the entire economy.”</p>
<p>This hasn’t happened.</p>
<p>In the <a href="https://www.nber.org/papers/w22667">United States</a> the percentage of workers in precarious employment – including agency temps, contract workers, independent contractors, freelancers and the like – rose from 10.7% in 2005 to 15.8% in 2015. Only an estimated 0.5% were involved with online intermediaries like Uber. </p>
<p>A <a href="http://natcen.ac.uk/media/1543748/The-characteristics-of-those-in-the-gig-economy.pdf">2018 report</a> for Britain’s Department for Business, Energy and Industrial Strategy estimated less than 1% of British workers relied on the gig economy for the majority of their income.</p>
<p>In Australia, our analysis of the data presented by Deloitte Access Economics for the <a href="https://www.finance.nsw.gov.au/sites/default/files/Deloitte_Report_Review_Collaborative_Economy.pdf">NSW Department of Finance, Services and Innovation</a> suggests 1.6% of the population earn money in the gig economy, often as supplement to other income. </p>
<h2>The limits of capitalism’s logic</h2>
<p>Uber and other labour-based digital platforms reveal the limits of the logic of contemporary capitalism: a logic based on the assumed value of deregulated markets that operate best with minimal interference by the state.</p>
<p>Their business models follow a textbook formula of unfettered capitalism. It eliminates employment obligations in favour of a spartan market-based economic exchange between capital and labour. Paid holidays, pension contributions, minimum wage, sick leave and protection from unfair dismissal – with a click on an app, all these hard-won rights disappear. </p>
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<a href="https://theconversation.com/a-new-definition-of-worker-could-protect-many-from-exploitation-91083">A new definition of 'worker' could protect many from exploitation</a>
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<p>If this were to become the dominant economic model, it would undermine the system rather than help it flourish. More workers would find themselves among the “working poor”, unable to sustain themselves and their families. The burden on the welfare state would increase. Conflict and industrial unrest would escalate, as it has wherever Uber has set up shop, be it in <a href="https://www.smh.com.au/world/north-america/almost-100-000-drivers-accuse-uber-of-wage-theft-20191108-p538kv.html">New York</a>, <a href="https://www.bbc.com/news/business-48190176">London</a>, <a href="https://fortune.com/2016/12/16/france-uber-protest/">Paris</a>, <a href="https://www.dw.com/en/spain-police-crane-lift-taxis-to-break-anti-uber-protest/a-47269876">Madrid</a>, <a href="https://www.bbc.com/news/av/world-europe-39046463/uber-threat-drives-noisy-italy-protests-by-taxi-drivers">Rome</a>, <a href="https://www.dw.com/en/germanys-taxi-drivers-protest-uber-deregulation-plans/a-48277628">Berlin</a>, <a href="https://www.bbc.com/news/av/world-africa-49008968/uber-drivers-in-nairobi-explain-why-they-are-on-strike">Nairobi</a>, <a href="https://www.theguardian.com/world/2017/sep/08/violence-erupts-taxi-uber-drivers-johannesburg">Johannesburg</a>, <a href="https://www.reuters.com/article/us-uber-ola-strike/uber-ola-drivers-strike-in-india-demanding-higher-fares-idUSKCN1MW1WZ">Delhi</a>, <a href="https://www.bbc.com/news/av/world-asia-35868569/scuffles-at-jakarta-uber-protest">Jakarta</a> or <a href="https://www.abc.net.au/news/2019-05-08/uber-drivers-stage-global-protest-over-pay-and-conditions/11092696">Melbourne</a>.</p>
<p>The business model is parasitical. It depends on the regular economy to subsidise it. And yet this is still not enough. To date <a href="https://www.forbes.com/sites/lensherman/2017/12/14/why-cant-uber-make-money/#45bd196e10ec">Uber has never recorded a profit</a>. When it listed on the New York Stock Exchange, <a href="https://www.bloomberg.com/news/articles/2019-04-12/uber-ipo-filing-warns-that-drivers-will-be-even-less-happy">its Initial Public Offering filing</a> revealed its plan to further “reduce driver incentives to improve our financial performance”.</p>
<h2>Normalising precarious work</h2>
<p>While we can be relieved the gig economy hasn’t become more widespread, it is a concern that these platforms’ high profiles and extensive marketing have helped normalise and sanitise business models with parasitical employment practices. </p>
<p>Celebrities to have fronted Uber Eats advertisements in Australia, for example, include Boy George, Sophie Monk, Naomi Watts, Nic Naitanui, Ryan Moloney, Peter FitzSimons, Rebel Wilson, Ruby Rose, Lee Lin Chin and Ray Martin. Its most recent campaign features Jimmy Barnes, John Farnham and Anh Do.</p>
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<p>Such endorsements have arguably helped to make Uber Eats and all forms of precarious work more acceptable.</p>
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Read more:
<a href="https://theconversation.com/the-costs-of-a-casual-job-are-now-outweighing-any-pay-benefits-82207">The costs of a casual job are now outweighing any pay benefits</a>
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<p>In Australia, some research suggests the number of workers who feel insecure in their jobs has been <a href="https://theconversation.com/workers-are-actually-feeling-less-insecure-in-their-jobs-81836">relatively stable for the past two decades</a>, as have <a href="https://theconversation.com/factcheck-has-the-level-of-casual-employment-in-australia-stayed-steady-for-the-past-18-years-56212">casualisation</a> and <a href="https://theconversation.com/australian-jobs-arent-becoming-less-secure-99739">self-employment</a>. But Australia also tops the OECD <a href="https://www.macrobusiness.com.au/2018/05/australia-tops-oecd-insecure-work/">in its levels of casual and contract work</a>. Given <a href="https://www.theguardian.com/business/2019/aug/14/wage-growth-in-australia-stagnant-at-23-despite-hourly-rate-rise">stagnant wage growth</a>, <a href="http://www.roymorgan.com/findings/7733-wealth-inequality-in-australia-is-getting-worse-201809210554">widening inequality</a>, <a href="https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/BriefingBook45p/HousingAffordability">falling housing affordability</a>, a <a href="https://www.smartcompany.com.au/business-advice/politics/wage-theft-woolworths-senate/">mounting wage theft crisis</a> and <a href="https://theconversation.com/self-employment-and-casual-work-arent-increasing-but-so-many-jobs-are-insecure-whats-going-on-100668">growing corporate power</a>, it is clear that feelings of insecurity and precariousness about work are painfully real for many. </p>
<p>So even without Uber taking over the world, we might all end up damagingly closer to the situation workers like Amita Gupta have found themselve in.</p><img src="https://counter.theconversation.com/content/127234/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>We need to see uberisation in the context of all forms of precarious and insecure work becoming more acceptable.Peter Fleming, Professor, University of Technology SydneyCarl Rhodes, Professor of Organization Studies, University of Technology SydneyKyoung-Hee Yu, Associate Professor, University of Technology SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1277462019-11-26T14:20:49Z2019-11-26T14:20:49ZUber’s troubles in London are nothing compared to the bigger picture<figure><img src="https://images.theconversation.com/files/303734/original/file-20191126-112531-16m1oog.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Shabby cabbie?</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/london-uk-march-23rd-2017-photograph-610479299">Ink Drop</a></span></figcaption></figure><p>The taxi app giant Uber <a href="https://www.theguardian.com/technology/2019/nov/25/uber-loses-licence-london-tfl">has again lost</a> its licence in London, if only temporarily. Uber has 21 days to appeal after Transport for London (TfL) ended a probationary extension it granted to the company in September, citing a “pattern of failures” around issues such as driver security. </p>
<p>TfL has no wish to deprive Londoners of low cost convenient transport, but this decision comes as little surprise. Uber does not appear to have the controls necessary to run a wide-scale transport service and assure passengers and authorities of adequate safety standards. Despite this being one of the company’s <a href="https://www.sec.gov/Archives/edgar/data/1543151/000119312519103850/d647752ds1.htm">top five markets</a> in the world by revenue, the company has shown a marked reluctance to fully cooperate with transport authorities. </p>
<p>Time and again, TfL has found that the only way to make Uber listen is to withdraw its licence and let it appeal. The authority originally <a href="https://www.bbc.co.uk/news/uk-england-41358640">refused</a> to renew Uber’s licence in September 2017, citing “public safety and security” concerns. That seemed to lead to better controls – certainly judging by the <a href="https://uk.reuters.com/article/uk-uber-britain/put-on-probation-uber-wins-london-licence-to-avoid-ban-idUKKBN1JK16V">concessions</a> Uber made in exchange for a 15-month probationary licence in June 2018, and then again <a href="https://www.standard.co.uk/news/transport/uber-only-given-twomonth-extension-to-carry-on-operating-in-london-a4244716.html">in September 2019</a> for a two-month extension. </p>
<p>Now, however, TfL <a href="https://www.bbc.co.uk/news/business-50544283">has announced</a> new issues including the fact that over 14,000 Uber trips in London in late 2018 and early 2019 were taken by 43 drivers with fake identification. These drivers had been able to exploit a change to the Uber system that allowed them to upload their photo to a different driver’s account. Some had previously had their legitimate licences revoked, while one had been cautioned by the authorities for distributing indecent images of children. Uber <a href="https://www.theguardian.com/technology/2019/nov/25/uber-loses-licence-london-tfl">has said</a> it alerted TfL to these issues in May, and claims that over the past two years, it has “fundamentally changed how we operate in London”. </p>
<h2>Where to, Uber?</h2>
<p>The latest TfL decision comes at a time when competition in ride-hailing has become cutthroat. The emergence of London competitors like <a href="https://bolt.eu/en-gb/cities/london/">Bolt</a>, <a href="http://driverapplondon.co.uk/ola-sets-its-plan-for-londons-launch/">Ola</a> and <a href="https://www.kapten.com/uk/">Kapten</a> were already making it <a href="https://www.wired.co.uk/article/bolt-taxi-london-price-uber-app">difficult</a> for Uber to maintain its significant <a href="https://www.independent.co.uk/news/uk/home-news/uber-fare-new-congestion-charge-london-a8857521.html">price increases</a> of recent years, while there are <a href="https://www.lyft.com/">plenty rivals</a> in other parts of the world as well.</p>
<p>All would-be competitors need to do is the same as Uber: vouchers and promotions to customers and incentives to drivers. Indeed, most taxi firms now have their own apps. Now that the market has caught up, Uber’s model amounts to little more than underpricing to customers to gain trade, while offering <a href="https://www.uber.com/gb/en/drive/rewards/">incentives</a> to drivers not to work for someone else, such as free insurance and gym passes. </p>
<p>Nonetheless, most passengers will have more than one app on their phones and taxi drivers can work for several providers at the same time. This is really just an extension of what has always been the case: the markets for both customers and drivers are highly competitive. The taxi market has <a href="https://knowledge.wharton.upenn.edu/article/uber-profitability/">never been</a> very profitable and that shows no sign of changing. Plenty of people in the UK are willing to drive taxis and the only qualifications are a licence, insurance, a roadworthy car and no criminal record. </p>
<p>Unfortunately, this problem for Uber is much wider than just the UK. In 2018, the <a href="https://www.sec.gov/Archives/edgar/data/1543151/000119312519103850/d647752ds1.htm">company made</a> adjusted losses of US$1.8 billion (£1.4 billion), compared to US$2.2 billion the year before. There is <a href="https://www.theverge.com/2019/11/4/20948213/uber-q3-earnings-report-net-loss-revenue-profit-2019">no real sign</a> of improvement <a href="https://investor.uber.com/news-events/news/press-release-details/2019/Uber-Announces-Results-for-Third-Quarter-2019/default.aspx">in 2019</a>, despite attempts to increase fares in Uber’s main markets. Whenever the company attempts to raise prices, demand drops. Uber has already had to exit <a href="https://knowledge.insead.edu/entrepreneurship/the-real-story-behind-ubers-exit-from-southeast-asia-10096">South-East Asia</a>, <a href="https://www.inc.com/associated-press/uber-yandex-merge-russia.html">Russia</a> and – though <a href="https://hbr.org/2016/08/the-real-reason-uber-is-giving-up-in-china">possibly</a> for reasons to do with state intervention – China. It is also <a href="https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/hail-no-more-ola-ubers-ride-growth-slows-to-a-crawl/articleshow/69641990.cms">struggling</a> in India. </p>
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<a href="https://images.theconversation.com/files/303735/original/file-20191126-112522-wujy33.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/303735/original/file-20191126-112522-wujy33.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/303735/original/file-20191126-112522-wujy33.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=468&fit=crop&dpr=1 600w, https://images.theconversation.com/files/303735/original/file-20191126-112522-wujy33.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=468&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/303735/original/file-20191126-112522-wujy33.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=468&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/303735/original/file-20191126-112522-wujy33.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=588&fit=crop&dpr=1 754w, https://images.theconversation.com/files/303735/original/file-20191126-112522-wujy33.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=588&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/303735/original/file-20191126-112522-wujy33.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=588&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Sputtering.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/navi-mumbai-vashi-maharashtra-india-march-1350204842">Willrow Hood</a></span>
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<p>It may well be that outside North America and parts of Europe, Uber will never be profitable. In many cases, it entered markets too late. And as the ride-hailing division attempts to reduce losses, the Uber Eats takeaway delivery business is <a href="https://qz.com/1693843/uber-eats-will-lose-money-until-at-least-2024-say-cowen-analysts/">driving them</a> deeper into the red. Uber Eats exhibits similar characteristics to the ride-hailing business, subsidising the cost of home delivery to attract demand. </p>
<p>Restaurants are traditionally low-margin businesses so they are unlikely to be able to foot the bill if the customer is unwilling to pay the full delivery costs. Home delivery also has low entry barriers and switching costs, which is likely to keep it competitive in future – there are already big incumbents like Just Eat and Deliveroo. Meanwhile, other Uber initiatives such as <a href="https://edition.cnn.com/2019/09/26/tech/uber-jump-app/index.html">bike hire</a> and developing <a href="https://www.theguardian.com/technology/2019/apr/19/ubers-self-driving-car-unit-valued-at-73bn-as-it-gears-up-for-ipo">driverless vehicles</a> face strong competition, too. </p>
<h2>Environmental concerns</h2>
<p>Besides Uber’s financial difficulties, there are serious environmental issues surrounding such businesses. Taxi driver numbers in London alone <a href="https://www.theguardian.com/technology/2018/aug/15/sadiq-khan-wants-to-restrict-number-of-uber-drivers-in-london">have increased</a> from 60,000 to 120,000 since 2012 when Uber entered the market. Studies <a href="https://www.cityam.com/1292973-2/">show that</a> not only has this increased congestion but CO₂ has increased by 23% for the taxi industry over that time. </p>
<p><a href="https://www.cnet.com/news/uber-promises-all-london-rides-will-be-in-electric-cars-by-2025/">Promises</a> that all Uber taxis will be fully electric by 2025 seem unconvincing, as taxi drivers themselves have to make the vehicle purchase and these vehicles are expensive – albeit Uber <a href="https://www.uber.com/gb/en/u/drive-journey-to-electric/">will provide</a> a subsidy funded by a fares increase. </p>
<p>As for Uber Eats, encouraging more people to get takeaways is not good news for carbon emissions either – at least when they are delivered on scooters or mopeds. These issues could easily turn the company into a pariah and make its battles with city authorities much harder as time goes on. </p>
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<a href="https://images.theconversation.com/files/303736/original/file-20191126-112517-3u508.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/303736/original/file-20191126-112517-3u508.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/303736/original/file-20191126-112517-3u508.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/303736/original/file-20191126-112517-3u508.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/303736/original/file-20191126-112517-3u508.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/303736/original/file-20191126-112517-3u508.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/303736/original/file-20191126-112517-3u508.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/303736/original/file-20191126-112517-3u508.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Green in bag only.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/gothenburg-sweden-april-11-2019-uber-1374104270">nrqemi</a></span>
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<p>No doubt after a lengthy appeal, Uber will agree to better controls in London to get around its current difficulties. It is true that the TfL decision may embolden authorities up and down the UK and elsewhere to feel more confident about taking on Uber, but the bigger questions are really about the overall business model. Remember that this is a company that was <a href="https://www.nytimes.com/2019/05/09/technology/uber-ipo-stock-price.html">valued at</a> US$82.4 billion when its shares were listed in May. It has already sunk beneath US$50 billion: the jury is very much out on whether this can be turned around.</p><img src="https://counter.theconversation.com/content/127746/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>John Colley does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Uber’s London licence has been a political football for several years, but that’s not really the point.John Colley, Professor of Practice, Associate Dean, Warwick Business School, University of WarwickLicensed as Creative Commons – attribution, no derivatives.