Deliveroo found guilty of abusing passenger rights in France

PARIS, April 19 (Reuters) – Two former bosses of Deliveroo (ROO.L) were given a one-year suspended prison sentence and a fine of 30,000 euros ($32,380) by a French court on Tuesday for abusing the freelance status of runners working for the British takeaway delivery platform.

The company was also fined up to 375,000 euros and will have to publish the court decision on Deliveroo’s French homepage for a month.

The decision could have repercussions outside of France, as the gig economy, based largely on digital apps and freelancers, faces a number of legal challenges that could redefine working conditions.

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The administrative inquiry, which reviewed a period stretching from 2015 to 2017, and the subsequent hearings showed that Deliveroo had imposed near-permanent monitoring and control over the work of riders while they were online. , said judge Sylvie Daunis.

This included allocating long time slots to riders to ensure Deliveroo had as many people as possible within easy reach over the weekend, and telling drivers who refused that they would not be allowed to work for the platform the following weeks, for example.

Even though the riders were self-employed, the tribunal also found that Deliveroo had unilaterally changed the criteria by which pay increases were set or the minimum time needed to be in line to qualify as a rider.

“This set of elements characterizes a situation of quasi-permanent legal subordination,” Daunis said, referring to a key element that defines employee status in France.

Deliveroo shares, which have lost more than 70% of their value since listing at 390p in March 2021, were trading down 6.5% to 106.5p on Tuesday.

Deliveroo said in a statement that it “categorically contests” the French court‘s decision and plans to appeal. It will maintain operations in the French market, he added.

Its statement said the court’s decision referred to an early version of its operating model and had no bearing on how it operates today.

“Our model has since evolved to be more in line with the expectations of our delivery partners, who wish to remain independent…Deliveroo will continue to operate with a model that offers these independent providers a flexible and well-paid business,” said said the company.

Former riders have sued Deliveroo for alleged abuse of their freelance status and claim the company should have hired them as employees.

Under French law, the status of employee gives rise to rights, in particular unemployment benefits, social security contributions and pensions.

Deliveroo pulled out of Spain last year after the government said food delivery companies must employ their couriers. The British company said it wanted to focus its investments on other markets where it had or could achieve a leading position.

($1 = 0.9268 euros)

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Reporting by Mathieu Rosemain in Paris, additional reporting by Paul Sandle in London; Editing by GV De Clercq, Barbara Lewis and Susan Fenton

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