Menulog to trial employment model for gig workers

The company, which claims to be second to UberEats, will also examine how it can “bridge the gap” between contracting and employment for its tens of thousands of active riders, such as by portable leave entitlements or superannuation.

It will then use its lessons from the Sydney trial to investigate establishing a new award with the Fair Work Commission and work with the Transport Workers Union to develop a more flexible model for the industry.

“We hope that in a few years time all the workers that are working on the Menulog platform will be employed,” Mr Belling said.

“The big caveat in our plan is we do believe the current modern awards that are out there are not suitable for the industry we’re working in.”

The move contrasts with Uber and Deliveroo which have both rejected an  employment model, with Uber saying 80 per cent of its drivers would quit if they had to work shifts.

However, Mr Belling told the inquiry he “did not see a reason” why his competitors could not move to employment given they had similar business models.

He praised employment as “the highest moral standard” as it gave fair pay and conditions and allowed the company to have greater control over safety, naming recent driver deaths in the sector as a key driver behind its decision.

Menulog currently engages its riders in Europe as employees but has not adopted the same practice in Australia since it started doing gig work in 2018.

If the company moves to the employment model Mr Belling said it would require riders to work exclusively for Menulog and would likely involve minimum shift lengths of two to four hours as per awards.

“Some workers don’t want to do that, some may be willing to do it,” he said. “Knowing what I know today I would say we need to work to have more flexibility than we currently have.”

TWU national secretary Michael Kaine said the announcement was “a watershed moment for the gig economy in Australia”.

He urged the government to regulate the industry so as to “level the playing field” and “protect companies moving to provide essential rights and protections for workers”.

Australian Council of Trade Unions secretary Sally McManus said if Menulog made this more than a trial “we will be calling on all Australians to ditch other delivery apps and only use Menulog”.

Uber and Deliveroo favour a third-way between contractor and employee that would allow them to give riders more benefits, like paid sick leave, without having to reclassify them as employees.

However, Uber has recently been forced to bring in minimum hourly rates for its 70,000 drivers in the United Kingdom after the Supreme Court held they were “workers” – a status between employee and independent contractor – entitled to protections.

Asked about minimum rates of pay, UberEats general manager Matthew Denman told the inquiry that “as long as we’re looking to the period of when they accept and when they complete a trip – ie the engagement time – then certainly we’re keen to engage on any consultation or discussion on that topic”.

“If you look to create minimum rates including wait time that will work against the interests of drivers because it will mean they lose flexibility,” he said.

The gig company said analysis from Accenture showed that almost all its drivers were earning about $21 an hour and at peak periods were averaging $45 an hour, “so much so that there’s a discussion around creating minimum standards around earnings”.

Labor Senator Tony Sheldon, who chairs the committee, said “granting minimum rates is just the bare bones regulation”.

“The flesh on the bones will be workers compensation, leave entitlements and independent oversight of pay and conditions.”