A Chicago court has found Uber Eats and Postmates (acquired by Uber in July 2020) guilty of listing more than 2,500 restaurants on their food delivery apps without their consent, and ordered them to pay $10 million dollars, half of which will go to the affected establishments, and the rest to cover the costs of the more than two-year investigation the authorities in the windy city had to carry out to demonstrate the effects of Uber’s policy. Verdicts in similar cases against Uber Eats competitors in Chicago such as Grubhub and DoorDash are expected shortly.
The evidence against food delivery companies’ bad practices is mounting: a few years ago, there was a stampede to provide consumers with restaurant food at home. These companies recruited thousands of workers and forced them to do their jobs without any of the protections we had long been building as a society: in many cases, delivery riders provided their own transportation, worked longer hours than were regulated, and waived rights such as unemployment benefits, vacation or insurance.
These companies operated on the basis that you come, you sign up in the app, and you start earning money, end of. In practice, this hid frequent downturns when work was scare, and although some workers were comfortable with this flexibility, many others found themselves working long hours with no rights. If you have an accident, that’s your problem, you should have been more careful.
As was to be expected, the authorities have steadily been regulating the sector, forcing companies to treat delivery riders as employees rather than freelancers. Finally, some limits have been imposed on a hyper-liberal sector.
Similarly, restaurants have demanded some protection: what right does Uber have to list my establishment on its app without my consent, set your prices, and when someone wants my services, simply send one of your “freelancers” to my back door with a bike and a backpack? What if I’m not interested? What if I want to have more control over my business? What if I don’t want to pay you a commission? Who are you to operate without any respect for my business model, simply on the basis that this is “disruptive”?
It’s finally becoming clear that some of the entrepreneurs we have glorified as a society for creating “unicorns” have done so by exploiting poorly regulated sectors, indulging in legally dubious practices with scant regard for any ethical principles. And as we learn more and more about the impact of their activities, the authorities are putting things in their place.
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This post was previously published on Enrique Dans’ blog.
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