An insightful report has just been released on DW News about Indian students working in the food delivery sector in Germany. Attracted to the country by the promise of a university degree leading to a high-flying business job, these students quickly find that they are stuck in a debt-trap, and have to work 10-12 hours a day in food delivery just to keep their head above water.
The big theme of the report is the role of 'middle men' in taking advantage of the students.
"One thing that has especially struck me while reporting this story is how middle men pop up at every level," concludes Kate Ferguson, DW reporter. "From recruiting students from India, to housing them once they're here, and finally getting them into the food delivery business."
The food delivery middle men are among the biggest "scamsters", as one rider, Bhavya, describes them. Bhavya worked for Wolt through a sub-contractor, which was just an anonymous contact on WhatsApp. He received "threats" warning that he'd be de-activated if he didn't work on-demand. Bhavya was sometimes paid cash-in-hand by a guy he had to meet down an alley. The sub-contractors shutdown before they have to declare taxes and then set-up again under a new identity. With no written contract, it's impossible for a food delivery courier to take an anonymous WhatsApp contact to court. Wolt was asked about this and said that "the correct legally compliant payment of couriers is the responsibility of the respective partner companies". In other words, 'nothing to do with me'. Deniability is exactly what the platforms are looking for in their relationship with shady sub-contractors: it allows them, in the words of one study on sub-contracting in Europe, "to separate power and profit from risk and responsibility".
But the scam only works if we accept Wolt's premise that the "partner company" really is the responsible entity for "the correct legally compliant payment" of Wolt's couriers. If, on the otherhand, we find that the real employer is in fact Wolt, given that it is the platform which directs and controls the rider via the app, then the middle man scam suddenly becomes unviable, since Wolt itself would be responsible for ensuring the rider is paid. The Court of Justice of the European Union (CJEU) adjudicated on the question of the real employer in 2020. The case involved a Cypriot company called AFMB, which had contracts with several lorry drivers based in the Netherlands. These drivers worked for Dutch transport companies. They were contracted with AFMB with the aim of bringing the drivers under Cypriot labour law, which has fewer social security protections and employer tax contributions than in the Netherlands. AFMB advertised itself as a means for transport companies to reduce their costs.
The CJEU found that the Dutch transport companies were the real employer and therefore Dutch social security legislation applied. In determining the real employer, they drew on the same ‘primacy of facts’ principle which applies in the EU Platform Work Directive. That is, that the reality of the working relationship is what determines which entity is the real employer, "irrespective" of what is written in the contract.
There are a number of cases involving algorithmic management where courts have found that the real employer is the entity which controls the algorithm. In a 2019 tribunal in Padua, Italy, it was found that the real employer of warehouse ‘pickers’ was the principal client, not the sub-contractor, because it was the client that controls the algorithmic management system to direct and monitor the workers “in real time” and “collect information on pick-rate; duration of breaks and workers’ peak efficiency; it could assess workers’ performance and subsequently evaluate them”.
According to the Tribunal, “the overall governance of the company’s activities and the direction of work can be considered to be a computerised relationship with the apparent client, leaving the contractor with a residual function of control and disciplinary intervention, usually requested by the client.”
There are many comparable examples in the platform economy where workers have a “computerised relationship” with the platform and the intermediary plays a “residual function”. Indeed, the Turin Civil Court in 2021 and the Paris Criminal Court in 2023 have both found that Uber Eats and Stuart respectively were the real employer, not the sub-contractors.
Article 4.3 of the Platform Work Directive requires that "the party or parties responsible for the obligations of the employer shall be clearly identified". While multi-party relationships are possible, there can ultimately only be one employer, and it is incumbent upon labour inspectorates and other competent authorities that they do not take at face-value that the sub-contractor is necessarily the real employer. Member-states, when transposing PWD, should make it explicit that it is necessary when investigating employment status to also investigate which entity is the real employer.
Middle men exist in the labour market when there is something which stops a worker from working for the principal contractor directly. In the platform economy, two types of blockage are typical: that the worker doesn't have the legal right to work in the country, and/or that the platform doesn't want to take legal responsibility for the worker's (horrendous) working conditions. These are racialised legal constructs: if it were not for the fact that food delivery draws largely on a pool of migrant labour with limited rights and little bargaining power, platforms would not be able to have business models in which intermediaries or sub-letted accounts play a critical role.
Placed between the worker and their labour, these middle men are gate-keepers. They add nothing of value to the labour process: they only extract. At the same time, platforms hide behind these gates, seeking to disguise the responsibility which they have to their workers. The quicker we cut the middle men out of the platform economy, the better. Ben Wray, Gig Economy Project co-ordinator |
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Gig Economy news round-up |
FRENCH SOCIAL SECURITY AGENCY DEMANDS €1.7 BILLION FROM UBER: Urssaf, the French social security agency, has demanded Uber pay €1.7 billion, after finding that its drivers are bogus self-employed. Urssaf investigated the situation of 71,000 drivers who worked for Uber between 2019 and 2022, concluding that Uber "knowingly disguised an employment relationship as a business contract to escape its obligations as an employer". Urssaf found "a legal relationship of subordination", due to Uber exercising direction, control and the power of sanctions over its drivers. €1.2 billion must be paid to Urssaf for the shortfall in social security tax contributions, with a further €512 million in "recovery surcharges". Uber responded by highlighting a recent verdict of the Court of Cassation last July, which found that Uber drivers are self-employed. "We are currently in discussions with Urssaf and are fostering a collaborative, open, and transparent approach," Uber added. Responding to the verdict, Leïla Chaibi, France Insoumise MEP and a campaigner for platform workers' rights, described the verdict as "a victory for the drivers", calling on the government to "now apply the employee status presumption from the platform [work] directive". Read more here. UBER BUYS GETIR IN TURKEY: Uber has agreed to acquire Getir, the Turkish grocery delivery platform. The deal will be structured in stages, with $335 million immediately to purchase Getir's food delivery business, followed by a $100 million for a 15% stake in the grocery, retail and water delivery part of the company, which will go up to 100% over the next few years. In 2023, Getir was the dominant grocery delivery platform in Europe, valued at one point at $12 billion, but the company pulled back to its Turkish market in 2024 due to large losses on its international operations. Getir, which is majority-owned by Abu Dhabi sovereign wealth fund Mubadala, has long been profitable in Turkey. A power-struggle for control of the company ended last year with the founder, Nazim Salur, being pushed out. Documents filed by Getir in court last year estimated its remaining assets to be worth $374 million. Uber bought Trendyol Go, another Turkish food and grocery delivery platform, for $700 million last May and plans to construct a technology hub in Istanbul, as it steps up its investment in the country. Read more here. UBER INTRODUCTION OF AI AGENTS "SINISTER AND DISTURBING": Uber has announced that it is set to introduce AI "agents" for its drivers and riders, a development that has been criticised by workers' data rights campaigner James Farrar as "sinister and disturbing". As part of its Q4 2025 earnings report, Uber stated that it was "piloting several first-party agents", including "an AI Assistant for drivers and couriers to help them plan their day and increase their earnings". AI agents are systems that can autonomously complete tasks. They are seen by experts as the form of generative AI that is going to have the most dramatic effect on work, since it goes beyond guiding or responding to human instructions to executing tasks outright. How exactly Uber's AI Assistant will work is as yet unknown, but Farrar, who is head of Worker Info Exchange and a former Uber driver, called on regulators to "urgently intervene to protect the rights of workers now put at great risk by employers with the unethical and exploitative use of AI at work.” Uber's Q4 earnings report saw operating profits of $1.77 billion, up 130 per cent year-on-year but below market expectations, leading to the stock price slumping. Read more here. JUDGE RULES LIEFERANDO RIDERS IN 3 GERMAN CITIES NOT ENTITLED TO WORKS' COUNCIL: The Federal Labour Court in Erfurt has found that Lieferando (Just Eat) riders in three German cities, Braunschweig, Bremen and Kiel, are not entitled to have their own Works' Council, because they are not "hub cities". The judge found that only cities which had "a minimum level of organizational autonomy" could have a Works' Council, ruling that Works' Councils which have been established in these cities since 2022 and 2023 are therefore invalid. Under German labour law a Works' Council gives workers the right to "co-determination" in the company, and have been a major tool for building worker organisation at Lieferando, the largest food delivery platform in Germany. The German-wide Lieferando Works' Council criticised the verdict, finding that the judge's emphasis on the need for on-site managers was outdated given the nature of algorithmic management in the platform economy. "If co-determination depends on whether an office with managers exists somewhere, then the Works Constitution Act is no longer suited to the modern working world,” the statement from Works' Council chair Julia Warkentin read. Mark Baumeister from the NGG union said the verdict "sent us back to the working world of the 1950s and solved no problem". Read more here. USE OF AGENCY GIG WORKERS ON THE RISE IN UK: Agency work platform Temper is being used by a growing number of companies in the UK. The Guardian has reported that retailer Urban Outfitters, bed specialist Dreams and the operator of several Royal Parks cafes are among those to be drawing temporary labour from the Dutch gig economy platform. Temper charges workers for fast access to their pay, charges that can mean Temper workers end up earning below the minimum wage. The use of Temper was criticised by Paul Nowak, general secretary of the Trades Union Congress, who called on the UK Government to bring in protections for gig workers. "Without action on bogus self-employment, bad employers will make greater use of legal loopholes and talent platforms to deny workers their rights,” Nowak said. Labour's Employment Rights Act, passed in December, is expected to lead to more companies shifting to gig economy models to avoid the new rights in the Act. The Labour government promised a consultation on employment classification before the end of 2025 in an attempt to tackle bogus self-employment, but it has been delayed. Temper denied that its workers are bogus self-employed. Read more here.
Have we missed something important? You can help keep us informed about what's going in the gig economy in Europe by e-mailing GEP@BraveNewEurope.com. |
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The Counter-app podcast series explores how app-based workers can counter the power of their algorithmic bosses. Each episode is based on new research for the ETUC on platform work, with the second episode exploring how vulnerable different industries are to Uberisation. Listen here. |
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Unprofitable Convenience
Ben Wray tells the story of the rise and fall of app-based grocery delivery platforms in Europe. |
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'Beneath the wage' interview
C.J. Polychroniou interviews Anne McClanahan, author of forthcoming book 'Beneath the Wage: Tips, Tasks, and Gigs in the Age of Service Work'. |
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The EU campaign for decent platform work has a webinar on the social security implications of the Platform Work Directive with Alberto Barrio from the University of Copenhagen, on February 26, 10.30-12pm CET, register here.
The European Trade Union Institute is hosting a webinar on 'Worker-centred algorithmic management: participatory approaches for design and governance' with Min Kyung Lee on 23 February, 3-4pm. Click here to register. |
Contact project co-ordinator Ben Wray at GEP@BraveNewEurope.com with news, events, ideas, feedback...whatever you think might be useful.
And if you like the Gig Economy Project newsletter, why not get your friends and colleagues to subscribe? Here's the link. |
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