The unsavoury price of convenience: unstable pay and undocumented working at Deliveroo
The most iconic blue of London streets used to be that of our quintessentially British police boxes. In the modern world, it is the turquoise flashes of Deliveroo riders rushing to complete orders.
Deliveroo is a convenient way for people to order a well-earned takeaway treat and, more recently, essentials from the local supermarket. The rapid expansion of the business since its launch 2013 has been front and centre of the gig economy revolution.
The work is valued for its flexibility and is considered a profitable 'side hustle' especially among students and young people. This is because couriers are considered self-employed so are not obliged to work a specified number of hours and can assign a substitute worker to use their account on their behalf.
However, this flexibility can come at a price as self-employed status can cause insecure working conditions for couriers and opens the door to a partly undocumented workforce.
From humble beginnings to a multinational unicorn
Deliveroo was born in London but devised by Americans.
The company was launched in Chelsea in February 2013 by co-founders Will Shu, a former Canary Wharf investment banker, and Greg Orlowski, a software engineer. The two are childhood friends who grew up in Newhaven, Connecticut.
Shu moved to London in October 2012 and during the first three months spent his time walking up and down Chelsea streets trying to sign up restaurants. Orlowski remained in the US and built the technology, which began only as a website; it was not mobile optimised.
Like many startups, the first year was not easy.
Shu would contact friends asking them to order food from the website and he would deliver. To promote the company, he would dress in a kangaroo costume and walk the streets of Chelsea.
The start up has grown exponentially since its humble beginnings, becoming a unicorn - a privately-held start-up with a value over $1 billion - in 2017.
The company had a revenue of nearly £2 billion in 2022, and now it operates in 200 cities and towns in the UK and has 50,000 restaurant partners.
The legal battle over courier employment status
FLOORS NOT CEILINGS: Adam Badger, IWGB member and researcher for Fairwork
FLOORS NOT CEILINGS: Adam Badger, IWGB member and researcher for Fairwork
Self-employed vs workers status
The Independent Workers' Union of Great Britain (IWGB) has represented Deliveroo riders for the past seven years, and argues that, for all the benefits flexibility can give, insecure working conditions should not be the price couriers pay for it.
The union has fought to secure Deliveroo couriers 'worker' status as they argue it would give riders rights they are currently barred from as self-employed people are not covered by employment law.
Worker status would guarantee couriers minimum wage rather than the per order pay they currently receive, and give them better sick pay protections. It would give couriers more leverage to negotiate with the company.
The Bureau for Investigative Journalism revealed in 2020/21 that 41% of Deliveroo couriers in London earned below minimum wage (at the time £8.72 for those over 25) when their total annual earnings were set against the number of hours they spent riding.
The investigation also uncovered riders working shifts for as little as £2 per hour.
Uber drivers were awarded worker rights by the Supreme Court in February 2021 because of how much control the ride-hailing company has over them. Prices are decided by Uber and the company does not tell the driver the passenger's destination until they have been picked up.
This means Uber drivers enjoy worker status so they must be paid in line with the minimum wage and receive a workplace pension.
Deliveroo riders — and those of other food couriers — do not have these same rights.
The Supreme Court decision
On 21 November the Supreme Court blocked the IWGB's appeal for a change to give Deliveroo couriers worker status.
This was on the grounds that the Deliveroo contract contains a substitution clause that permits riders to subcontract their work to others, providing the account holder conducts the necessary DBS and right to work checks.
The five judges also said there was no “employment relationship” between riders and Deliveroo as couriers are free to reject work and work for competitors.
Adam Badger, 29, IWGB representative said: "[We] are going to keep pushing. There's workers constantly coming to the union trying to join, trying to organise other workers, trying to fight for better conditions.
“As a worker you can see there’s an injustice here. This company's starting to get close to turning a profit but there’s still workers who can’t afford to feed themselves."
In response criticisms levelled at Deliveroo in this article, a spokesperson from the company said: "This is a misrepresentation of how Deliveroo works with riders. Riders choose to work with Deliveroo primarily because they value the flexibility this offers. Riding with Deliveroo lets you work around your own schedule and balance this with other responsibilities, whether that involves other work, running your own business, studying, or spending time with family and friends.
“Deliveroo offers flexible work to more than 80,000 self-employed riders across the UK. We receive thousands of Deliveroo rider applications each week and retention is strong, underlining the popularity of the work we provide.”
A subculture of undocumented work
The substitution clause
The substitution clause upon which the Supreme Court ruling is based is contentious, as it can create even more precarious working conditions. It is a route for undocumented workers to work illegally, if an account holder does not conduct the correct checks when renting their account.
A BBC investigation published on 14 November revealed how the clause allowed a 17-year-old, who died whilst on the road, to rent a stranger’s account, despite being underage. This undocumented work was also covered by the Times in 2019.
Ian Clark, director of research at Nottingham Business School's Centre for Work, Informalisation and Place, said he found within the gig economy in his research "a large pool of what might be described as undocumented migrants" working for food couriers.
His research was conducted with other colleagues in Nottingham and the East Midlands but he estimated the same trends exist across the country.
He said he found many migrants, denied access to the labour market, "are either waiting for documents to become documented or have been declined UK residency status and are appealing against it.”
These migrants, who may be asylum seekers, have their housing paid for, for example in hotels, but are denied the right to work and access to public funds apart from “about £35 a week pocket money, but they can’t claim any other benefits at all.”
Migrants otherwise rely on charities for other necessities such as clothing and food, when their small allowance runs out, but also often need money to pay off debts they incurred travelling to the UK or to support their families.
When the third sector fails, they enter the informal economy.
A spokesperson for Deliveroo said: “Deliveroo takes a zero tolerance approach towards any rider who fails to meet their legal obligations when working with us. If a rider is found to be without the right to work in the UK, we will stop working with them with immediate effect.
“We take our responsibilities extremely seriously and have an industry leading position. We have introduced facial recognition technology which will help to counter any abuse on the platform and, as outlined to the Minister last month, we plan to strengthen this further with a registration process and right to work checks for substitutes. We will continue to work in close collaboration with the Home Office to support efforts in this area.”
Renting accounts
Undocumented or partially documented workers rent accounts from people wanting to make more money from their accounts, according to Clark.
Renting out an account keeps it at the top of the app's algorithm - named 'Frank' at Deliveroo after the It’s Always Sunny in Philadelphia character - because the account can be active more hours of the day than it would be if it were used by only one person.
This means subcontracted accounts in theory can attract more orders and make more money.
Clark explained relationships between account owners and undocumented workers can be coercive and exploitative. Undocumented workers renting accounts may out of necessity accept sub-minimum pay from the account holders and risk not being paid at all.
“It's a pernicious form of relationship where what academics call 'precariousness' is built into the system: already precarious workers impose the same thing on fellow workers, maybe who are undocumented.
"But there’s a willing number of people who are prepared to do that because there’ve got no alternative.”
Excluded from the labour market and with no access to public funds, these undocumented workers have no alternative to make ends meet and cannot afford not to work.
He said: “The companies don’t condone this but their systems really effectively allow it because of the subcontracting nature which is allowable for documented riders.”
Clark explained how the roots of this crisis can be traced back to the Home Office’s 'hostile environment' policy to tackle rising immigration numbers.
The Home Office, under Theresa May's tenure as Home Secretary, determined that if conditions for migrants with no leave to remain in the UK were made inhospitable then the individuals would leave the country.
This policy was unsuccessful as the most recent ONS statistics show net migration more than tripling from 215,000 in the year ending June 2013 to 672,000 in the year ending June 2023.
Clark maintained the policy only compounded struggles for undocumented migrants, and forced them into more informal and dangerous work.
Clark also claimed that whilst the Supreme Court decision will not significantly change conditions for legitimate, documented Deliveroo riders, it may make create challenges for undocumented riders if Deliveroo tighten up their contractual arrangements as a consequence.
On the same day the BBC report was published, former Immigration Minister Robert Jenrick urged food delivery companies to end the practise of unchecked account renting, as the business model “places the public at risk, enables – and therefore encourages – illegal migration, and leads to the exploitation of workers.”
“At the moment, what is going on is too much scam.”
Dylan*, Deliveroo courier
Operating in the digital world...
A popular way to take advantage of the clause and rent out accounts is to advertise them on social media. Facebook and WhatsApp are particularly popular.
Accounts generally go for anywhere between £30 and £100 per week.
Once money has changed hands, the account holder gives the substitute worker their password, which they uses to access the account and work under the account holder's name for the week.
This is why the person who delivers an order to the door does not always match the description of the person on the app.
After the week, the account holder will change their password, locking the substitute out and should transfer the money earned across that week out of their bank account and into that of the substitute.
One rider, Dylan*, 35, who moved to the UK from Bulgaria in 2014, claimed account holders are not always this honest, saying: “At the moment what is going on is too much scam. People acting like they want to rent you an account, just to take your money.”
He said many who rent their accounts created them during the pandemic when restrictions did not allow them to work their primary jobs.
Since restrictions were lifted, these people started renting the accounts as an extra income source even after they returned to their original jobs, he claimed.
The adverts here come from very accessible pages, and are not necessarily for accounts to be rented illegally, but they illustrate how easy it can be to get hold of an account.
The practice of substituting accounts takes place across more food couriers than just Deliveroo.
Dylan* has delivered for Deliveroo, JustEat and UberEats for three years in the Brighton area, Deliveroo’s second city after London. He said he works for all three because he would not make enough money delivering only for one; he claimed the pay and availability for work ranges between each courier.
This means Dylan hardly stops working. On the day I spoke to him, he had planned to take a four hour break during a typically quiet afternoon before an evening shift. He claimed Deliveroo offered to boost his pay until 4:30pm so he felt compelled to sacrifice time with his family to make a little extra cash.
“When I decide to have a day off, when I’m relaxing, yeah, boom! Suddenly Deliveroo is paying more per order. I cannot peacefully lay down and watch a movie when I know that in two hours I can make, £40, £50, you know?”
Deliveroo offers these boosts when there are fewer drivers around or it is very busy, he said, to keep business moving.
This means Dylan often works seven days a week.
The father-of-two also claimed the substitution clause creates an unfair market which penalises legitimate workers.
He claimed the misuse of the clause "is allowing too many people [to work] who are coming from different countries, let’s say Brazil, Turkey, that are not allowed to work here."
Undocumented workers, he claimed, might be students whose visas do not allow them to do self-employed work and that they work without paying the same business insurance as he does, which can be up to £1.80 per hour.
This means undocumented workers make more money than him per trip, he claimed, and do not experience the same stress as he does when there are delays in food preparation at restaurants.
“For these guys it is not a problem. They're not getting stressed, nothing. They're just sitting there waiting because they're not paying insurance.”
“You can’t support yourself here, but I try to send money, here and there I guess, to support my family in Afghanistan. But it’s very difficult to save the money.”
Ben*, Deliveroo courier
Another rider, Ben*, 26, who is from Afghanistan and moved to the UK in 2018 to flee the Taliban, explained how the illegal misuse of the substitution clause makes his work harder.
Ben claimed it is not uncommon where he works in East London for an undocumented worker to rent multiple accounts at once and said too they are often international students who should not have access to this type of employment.
To gain a competitive advantage, they set the location of one account at a popular restaurant, for example, a McDonald's in Dagenham when they are actually completing another delivery in East Ham.
This allows the undocumented courier to receives notifications for a collection at the Dagenham McDonald's before Ben does, because the Deliveroo algorithm thinks he is closer to the restaurant than Ben.
The saturation of this market with undocumented couriers means fewer orders per night for Ben, driving down his overall pay.
He enjoyed the flexibility of the job at first and how self-employment allowed him to choose whenever he wanted to work. The pay, he said, was good back then.
But he now works six days a week as the cost of living increases. The cost of fuel and insurance – necessities for someone riding a motorbike – are increasing, he claimed, but pay per order is not rising accordingly.
Ben has no dependents in the UK but moved with the intention of sending money back home to family. But, he claimed, he barely earns enough to meet his own needs, so struggles day to day.
“You can’t support yourself here, but I try to send money, here and there I guess, to support my family in Afghanistan. But it’s very difficult to save the money.”
"It's a very high stress slot machine sometimes: you pull the arm and you hope something good comes up...”
Adam Badger
In conversations the IWGB has had with couriers, it also claims to have found Deliveroo riders complaining their pay was decreasing over time.
Adam, who also researches the platform economy at the Fairwork Project, claimed this trend is not always obvious within each pay packet but when a rider looks back on their pay over a year, they seen a marked difference.
DEATH BY A THOUSAND CUTS: Workers claim pay is decreasing over time
DEATH BY A THOUSAND CUTS: Workers claim pay is decreasing over time
Deliveroo however has said pay is trending upward not downward over this period.
Adam stressed how important more secure pay is for gig economy workers. Whilst there was once a flat rate of pay per order, Deliveroo has introduced a new pay model, which Adam claimed was a 'dynamic' model, which calculates pay based on many variable metrics within the market.
This can be, for example, how many orders are being placed or the number of active couriers in a location, which can vary from order to order.
He claimed: “Workers don’t always know what the ingredients are in the ‘cake’, that is, the fee that you’re being paid. It might have a bit of distance, a little bit of time, a little bit of how busy it is in the rest of the market, but you don’t really know how those add up and so you never have any transparency over your own pay."
VOLATILE AND CHALLENGING: The work of a Deliveroo rider
VOLATILE AND CHALLENGING: The work of a Deliveroo rider
Adam, who rode part-time for Deliveroo in East London for two years before and during the pandemic, claimed there are riders who have been made homeless working 60 hours a week and that couriers deserve more stability because their work – contrary to popular belief – is high skilled.
He said riders need to know every single loading bay across multiple postcodes, knowing which restaurants they can get to quick enough, choosing the most efficient addresses to deliver to, and riding through tight gaps quickly.
Adam also agreed with Clark's analysis, recognising how the substitution clause, whilst he said it isn't often used, “oftentimes just opens the door for further exploitation.”
NO BLAME: Adam's take on undocumented workers
NO BLAME: Adam's take on undocumented workers
Adam said: “The psychology of a Deliveroo rider is complicated. I think it's a very high stress slot machine sometimes, you know: you pull the arm and you hope something good comes up.”
Names in this article with an asterisks (*) have been anonymised.
All uncredited photos and videos were taken by Harrison Newsham.
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