Menulog will directly employ its delivery riders and pay them award wages and entitlements like superannuation and annual leave.
The move is a departure from the gig economy model that currently sees drivers engaged as independent contractors.
As a result of the announcement, unions want all Australians to use Menulog and boycott other companies such as Uber Eats and Deliveroo.
Menulog to directly employ delivery riders
Menulog’s managing director, Morten Billing, made the announcement at a NSW Senate Inquiry into the gig economy.
He said the current model of engaging riders as independent contractors instead of employees needs to change.
He also said delivery riders deserve better pay and conditions, in addition to job security.
“We owe it to our couriers to help enhance their life standards and as such, we have begun looking at how we can improve the way we operate and, as part of this, how we can also roll out an employee model in Australia.
“We know this process will take time because we are a big company with a large global network, across 23 countries, each with their own requirements.
“Due to the timing of the hearing today, we are sharing this update on these intended changes sooner than anticipated.
“However, we strongly believe it is the right approach for this market and we are therefore committed to progressing with it.
“We believe this plan will help us better do the right thing by our couriers and also meet our moral obligations as an Australian-born business and one of Australia’s largest food delivery platforms.”
Unions call for Australians to support Menulog
Unions and workers’ rights campaigners took to social media to encourage Australians to support Menulog, and also to boycott other food delivery platforms.
ACTU Secretary Sally McManus tweeted:
“We are calling on Australians who get food delivered to use Menulog & ditch those who are exploiting workers & undercutting good employers.”
Menulog said it will start a pilot employment program in Sydney, but warned the changes will take time.
“Ultimately, we want to employ couriers,” he said.
“However the current regulatory framework presents a number of challenges.
“Specifically with regards to existing modern awards, the lack of flexibility they present and subsequent cost.”
Menulog says it wants to work with unions and the Fair Work Commission to create a new award to cover food delivery workers, as a result.
Industrial advocate Miles Heffernan applauded Menulog’s planned changes, arguing that paying below award wages is a form of wage theft.
“It’s about time one of these food delivery platforms made the move to improve conditions for their workers,” he said.
“For too long now, these companies have made a fortune off the back of hard working riders.
“They earn below the minimum wage, they don’t get holiday or sick pay or superannuation, and they also can’t sue for unfair dismissal.
“It’s wrong and the system needs to change, so good on Menulog for making the first move in the right direction.”
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