“It’s a landmark decision that will fundamentally reshape work in the gig economy and will reshape the rights of workers in that economy,” he said. “Companies like Uber Eats and Deliveroo should be very worried by this decision.”
Mr Watt said the impact of the decision had far-reaching implications.
“It’s a great decision for Foodora workers but there are huge numbers of other gig workers engaged by other gig companies who continue to be faced with precarious employment and below-award pay,” he said. “People often think about the Ubers, Foodoras and Deliveroos but we are seeing this gig work spread to aged care, child care and disability care.”
Senator Murray Watt chaired the Future of Work inquiry. Credit:Alex Ellinghausen
Anthony Forsyth, professor of workplace law at RMIT University, said gig economy companies had “tried to have the best of both worlds” by using quite complex systems to control the way people do work while maintaining the workers were independent contractors.
In his ruling, Commissioner Ian Cambridge looked at Foodora’s “batching system” which was used as a device to rank workers, giving them opportunities to work at better times depending on performance.
He also looked at the uniform and Foodora branded equipment as factors which contributed towards employment status.
“This is high level of control normally found in employment,” Professor Forsyth said. “This decision blows this open, saying to these companies you can’t have it both ways.”
Professor Forsyth said competitors such as Uber Eats and Deliveroo are likely to have to revisit the amount of control that they have, including star rating systems where workers can be dropped from the service if they get a poor rating.
He said the gig economy businesses would also have to look at requirements for wearing branded clothing and carrying branded delivery boxes.
“Those are the main things that will turn this on its head from here on,” he said. “I think this opens the door to more cases.”
However, Anthony Massaro, partner at law firm Russell Kennedy, cautioned that each case depends on the specific arrangements between the parties, and not even all Foodora workers are engaged under the same model.
“This decision does not overturn the Uber decision, or flag the death of the gig economy,” he said. “It just means that if your business model depends on the provision of personal services by contractors, you need to be very careful about how you set it up.”
Fairfax Media contacted Uber Eats and Deliveroo for comment but did not receive a response prior to publication.
Cara is Fairfax Media’s small business editor based in Melbourne
Our weekly podcast giving you insight into the stories that drive the nation.
Autralia economy news