PAYING the minimum wage would be “incompatible” with Deliveroo’s business model, the food delivery company’s boss told MPs yesterday.
Britain’s managing director Dan Warne insisted the company’s “resistance” to employment tribunal cases where workers were seeking the minimum wage and holiday pay was not opposition to employment rights.
He said it was instead a “resistance to having to pay guaranteed minimum wage for every hour for every rider.”
Mr Warne was appearing at a hearing of Parliament’s Scottish affairs select committee looking into the “gig economy” of casualised work.
Bosses from cab business Uber and Amazon, which now pays its own casualised delivery workers, also defended their practices on grounds of “flexibility.”
Uber is currently appealing an employment tribunal ruling that its drivers should be classed as workers rather than self-employed, and so should be afforded a minimum wage and other rights. Deliveroo has faced similar legal action from some of its workers.
Deliveroo boss Mr Warne suggested legal restrictions prevented such companies from offering employment rights to workers.
But Tory MP Anna Soubry grilled him: “Do you actually know what benefits Deliveroo wants to give but is precluded from so doing from law?”
Mr Warne replied: “I don’t feel qualified to answer that, that’s for government to say.”
After further grilling he said direct employment would oblige the company to stump up 30 per cent extra in payroll costs through having to pay national insurance.
Tory MP Christopher Chope asked if opposition had been stirred up because “trade unions have hated the self employed.” But bosses denied this, saying they had good relationships with their workforces.
Uber public policy chief Andrew Byrne said the company chose to class its workers as self-employed “because that’s the dominant flavour of the industry at the moment.”
He said surveys of workers showed support for the model on the basis they can choose to work as much or as little as they like. This sentiment was echoed by his fellow executives.
SNP MP Deidre Brock put the bosses on the spot, asking: “I take it you have employment rights within the jobs you do?”
Mr Warne later said there were no formal structures for career progression for Deliveroo “riders,” suggesting putting these in place could land the company in trouble because it would be “getting close to looking like employment.”