Monday 10/25/21

Labour Council says food couriers are employees, not entrepreneurs

Platform-based companies consider them as freelancers not entitled, for example, to sick leave, holidays and other benefits that employees have. At the same time, companies save a lot of money on labor costs.

Foodora food courier. Image: YouTube/AppJobs.
Foodora food courier. Image: Screenshot/YouTube/AppJobs.

The Finnish Labour Council has issued two opinions concerning the legal status of food couriers working in the platform economy for companies such as Wolt or Foodora.

According to the Labour Council, the food couriers of the companies that were the subject of the request for opinions are considered employees and therefore they fall within the scope of application of the Working Hours Act.

The Regional State Administrative Agency requested opinions from the Labour Council regarding the application of the Working Hours Act to food couriers of the two companies. The key issue was whether a food courier is considered an employee or an entrepreneur.

The companies of the so-called platform-based work have viewed food couriers as independent entrepreneurs who are not subject to employment legislation.

As long as they are considered as freelancers, they are not entitled, for example, to sick leave, holidays and other benefits that employees do. At the same time, companies save a lot of money on labor costs.

Employment relationship

The Labour Council, on the other hand, considered that the characteristics of an employment relationship were fulfilled in the work of food couriers. Most of them work for only one company and have to be available in case they are required to make food deliveries. The Labour Council voted on the decision with the employer organisations disagreeing.

Platform-based work utilises a digital platform maintained by a company, through which food couriers are informed of the need for delivery. The company recruits restaurants as users of its platform and food couriers for delivery services.

In other European countries - for example Spain - it has been the courts of law that have ruled that these workers are employed and not self-employed.

Decision not binding

“Although the opinions of the Labour Council are not binding, they nevertheless offer important guidelines. The status of thousands of people who work in the platform economy in Finland will be affected by the Council’s opinion. I assume that companies will now carry out this kind of assessment,” Minister of Employment Tuula Haatainen says.

“In its Government Programme, the Government committed itself to examining the need for legislative changes from the perspective of the transformation of work. The platform economy is at the heart of this work, and the Labour Council’s opinion will be taken into account in the preparation,” Minister Haatainen adds.

The Labour Council is an independent special authority under the Ministry of Economic Affairs and Employment. It has a minimum of nine part-time members three of whom are independent. The other members represent employer and employee organisations.

The Labour Council issues opinions on the application and interpretation of legislation on working hours, annual holidays and occupational safety and health and a number of other acts on the protection of employees.