Business

Deliveroo offers concessions in pay row

Deliveroo protest Image copyright PA
Image caption Deliveroo drivers have been protesting about the new pay proposals

Takeaway delivery firm Deliveroo has softened its stance on a controversial new pay scheme which saw it face a backlash from drivers and government.

Workers can now opt out of the firm's pilot scheme to pay £3.75 per delivery, instead of the present rates of £7 an hour plus £1 a delivery.

For those in the new scheme, the firm will also make sure they are paid at least £7.50 an hour at peak times.

The firm said it had made the change in response to driver feedback.

'Listened to concerns'

The Department for Business, Energy and Industrial Strategy (DBEIS) has said workers must be paid the so-called "national living wage" of £7.20 an hour, unless HMRC or a court ruled they were self-employed.

Deliveroo had said the new pay scales were part of a pilot programme being tested by just 280 London riders, out of more than 3,000 in the capital.

Announcing the concessions, the firm's UK and Ireland managing director Dan Warne said: "We've reached out to every rider involved to gather feedback.

"We've listened to their concerns and offered every rider the choice to withdraw from the trial.

"For those that choose to take part in the trial we'll also be guaranteeing fees at peak times for riders will be at least £7.50 per hour plus tips and petrol costs."

And the firm said the new pay plan, which had led to driver protests, was only going to be a 90-day trial which will now be voluntary.

'Decent wage'

Last week Deliveroo drivers protested outside the company's headquarters in central London about the new pay rates.

It prompted DBEIS to state: "The government is determined to build an economy that works for all - that includes ensuring everyone gets a decent wage.

"An individual's employment status is determined by the reality of the working relationship and not the type of contract they have signed.

"Individuals cannot opt out of the rights they are owed, nor can an employer decide not to afford individuals those rights."

Deliveroo provides a delivery service to thousands of restaurants that do not have their own drivers, using riders on bicycles or mopeds. Customers are charged a £2.50 delivery fee.

Set up in 2013 by William Shu, a former investment banker, and software developer Greg Orlowski, Deliveroo has attracted hundreds of millions in funding from venture capital firms.

It plans to use the cash to expand the service to more cities in Europe, Asia and the Middle East.

A fierce battle is under way in the UK takeaway delivery market, with companies including Just Eat, Hungry House and Uber Eats vying for customers.

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