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French court fines Deliveroo for ‘undeclared labour’

A Paris court has fined British meal delivery group Deliveroo after ruling it was guilty of "undeclared labour" for using freelance riders who should have been classified as employees, depriving the state of millions of euros in payroll taxes.

A Deliveroo food delivery driver on a scooter
A liveried Deliveroo food delivery driver on a scooter in Toulouse. (Photo: Georges Gobet / AFP)

It was the latest move by European courts to recognise the rights of “gig economy” workers used by start-ups and other firms, which often claim they are simply go-betweens for clients and independent contractors.

The court ordered the maximum fine of €375,000 sought by prosecutors and also handed suspended one-year prison sentences and €30,000 fines to two former French executives at the company.

A third executive got a suspended four-month sentence and a €10,000 fine for complicity in the system, and Deliveroo was also ordered to pay €50,000 each in damages to five labour unions who joined the case as plaintiffs.

State prosecutor Celine Ducournau had sought in vain to question Deliveroo’s American founder and CEO Will Shu over a “fraud” that gave “all the benefits to the employer… without any of the inconveniences.”

“The question is not to determine if the status of independent contractor is appropriate, but to acknowledge that in this instance, Deliveroo used a fake legal arrangement that did not correspond to the reality of how the delivery riders work,” the presiding judge said in her ruling.

A Deliveroo spokesman said the company “categorically contested” the decision and said it was considering an appeal.

“Our business model offers our deliverers the flexibility they need and which they tell us they appreciate,” he said.

Legal grey area
More than 100 Deliveroo riders were plaintiffs in the case prosecutors opened in 2015 but which got fresh impetus in 2020, when France’s URSSAF agency in charge of employer social security collections demanded millions of euros in back payments.

Several riders told the court they had sought jobs that offered scheduling freedom only to find intense pressure to work at peak meal times, strict oversight of their routes and days off, and penalties if orders weren’t delivered fast enough.

Deliveroo France had already been found guilty of undeclared labour in a civil case in February 2000, when a court sided with a rider seeking to be recognised as an employee and not a contractor.

URSSAF is seeking to recover some €9.7 million from Deliveroo, and a court had already ordered in 2020 the seizure of €3 million in Deliveroo’s account while the case was ongoing.

The ruling comes as the European Union is taking aim at the business model of gig economy companies like Deliveroo and the ride-sharing service Uber, with plans that could force them to reclassify their workers as fully-fledged employees.

The companies insist the workers are self-employed, and courts across Europe have issued contradictory decisions – sometimes forcing companies to provide workers with standard contracts, at other times upholding their status as independent contractors.

In December, Deliveroo won a case in Belgium where a court found that riders did not have to be requalified as employees, with the requisite social security and tax obligations.

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CRIME

Trial begins in France over European horsemeat scandal

Eighteen people went on trial in France on Tuesday accused of running a Europe-wide giant horsemeat trading network involving produce not cleared for human consumption.

Trial begins in France over European horsemeat scandal

Mostly shunned by consumers in the United States and Britain, horsemeat — typically cheaper than beef — has long been part of culinary habits across European countries, including France, but its production and distribution are strictly regulated.

The case coming to trial in the southern port city of Marseille is the biggest horsemeat scandal since 2013, when millions of ready meals were withdrawn from stores across Europe after they were found to contain horsemeat instead of only beef as indicated on the label.

Standing trial are French, Belgian and Dutch nationals charged with violating EU sanitary rules governing the horsemeat trade, and with forging official documents between 2010 and 2015.

They are also accused of duping the owners of ageing horses into believing that their beloved animals would live out their days in the countryside when in reality they were taken straight to the slaughterhouse.

The specific charges in the trial, which is set to last for three weeks, are fraud, conspiracy to commit fraud, and misleading consumers and endangering their health.

The members of the group, which includes licenced horse meat traders and veterinary surgeons, are believed to have violated a number of EU rules about the import of horses, including by forging certificates of origin.

The main suspect is 58-year-old Belgian Jean-Marc Decker, who prosecutors say supplied the network with horses whose meat was unfit for consumption.

In addition to the accused individuals, mostly in the 50s or 60s, a horsemeat wholesale company based in southern France is also in the dock for distributing the meat, falsely claiming that it was French.

The company, according to prosecutors, “was indifferent to the health imperatives governing the sector”.

Court proceedings were to start with the testimony of the top veterinary official at the municipal abattoir in Ales, southern France, where the investigation started in 2013.

Former horse owner Aline Oudin, due to testify Wednesday, told AFP she had handed her horse over to one of the defendants in 2013 in exchange for a promise of a “happy retirement” for the animal. Two weeks later she found out that the horse had been slaughtered and its meat sold.

“They tricked owners, they tricked consumers, they tricked everybody,” she said.

Plaintiffs also include France’s veterinary association, the cattle and meatpacking association ANBV and the Ales municipality.

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