A unionization effort is underway. Such a common occurrence would not normally be cause for comment, but this effort happens to be directed at Foodora couriers.
Foodora is an app-based food delivery service. With a few taps on a smartphone, customers can get restaurant food delivered right to their door. The company relies on individuals signing up through its app to become food couriers.
Foodora is a product of the “gig economy” and such app-based companies are new territory for unions and the Ontario Labour Relations Board.
Foodora claims its couriers are independent contractors. But, the Canadian Union of Postal Workers says these couriers are, in fact, employees, making them eligible for unionization.
If CUPW successfully unionizes Foodora’s couriers, it will set a precedent for unions looking to represent other app-based companies. It would open up a whole new industry to unionization and compel the reconsideration of employment conditions for a largely invisible workforce.
Not only would Foodora couriers be entitled to collectively bargain – they would be entitled to claim minimum employment standards under the Employment Standards Act. These standards include minimum wage, vacation, overtime, and notice of termination. They apply to persons who are employees in Ontario.
If CUPW is successful, it is likely that Foodora will pass the cost of increased wages and benefits on to consumers. Currently, the company charges around $3.50-$4.50 per delivery. Are consumers willing to pay more? If not, what does that mean for the app-based business model? How will the parties balance the interests of the Company and those of the employees? How does the Company make money while the employees earn enough to have a living wage?
For other employers in industries where you have avoided having formal employment relationships and used independent contracts, you may want to do a legal review. It is better to discover the potential legal problems now, rather than receive the union certification served at your front door.