T his is the second part of a two-part series looking at my experience as a Deliveroo rider in Amsterdam. Along with the transition from being an employee to the controversial self-employment freelance contractor (known as “ZZP” in Dutch or the Zelfstandige Zonder Personeel.) You can read the first part here.
After two years of dishing out employed contracts to couriers, Deliveroo began to experiment with the freelance model in South Holland before decisively implementing throughout The Netherlands at the end of 2017. Deliveroo claims that this new model is more flexible. Opposition by the riders claim that it’s unstable while creating burdens for the rider.
There is no job that comes to mind that has changed so much in such short time while the overall premise remained the same. This transition sheds light on what the gig economy really means to those who work within it and how such a template can affect future industries.
The introduction of the ZZP model
Riders in Amsterdam formed an unofficial Riders Union and partnered with the FNV (Federation of Dutch Trade Unions,) the largest trade union in The Netherlands. They sent an ultimatum to Deliveroo with two strict requirements. End the ZZP freelance model immediately and couriers may only work on the basis of an employment contract.
The Rider Revolt
Deliveroo refused to address the requirements and the FNV decided to proceed with more forceful actions. They began a full-scale offensive, contacting national media outlets and rolled out coordinated strikes, beginning on New Year’s Day, one of the busiest days for delivery services. What followed was a revolt of biblical proportions.
Riders took to social media to spread their message of discontent. #Slaveroo was the hashtag along with the use of taglines such as “fake” and “illegal.”
There were photos of Deliveroo bags dumped in garbage piles and hanging from street signs. Backpacks were set ablaze and thrown into the canal. Organized strikes became borderline malevolent, with empty pizza boxes stacked and taped up against the door of the Deliveroo headquarters in Amsterdam to prevent people from entering or leaving.
Flexible or unstable?
The effort to bring down the new system and revert to employment contracts was lead by one particular group; the full-time riders. It was difficult not to sympathize with them because they were considered the face of Deliveroo.
They were competent riders who took pride in their work. Many had additional responsibilities in assisting with scheduling, offering technical support to restaurants, delivering supplies, training new recruits, ensuring standards were kept on par while being available to answer questions and offer opinions for improvements.
What is there to lose?
But the freelance model would take that all away. There was a realization that they were not the face of Deliveroo, but just a replaceable cog in a machine aimed at increasing profits at their expense. This created resentment for the thousands of miles incurred on their bikes and joints while taking away their security for income while imposing new burdens.
The Riders Union and the FNV produced a pamphlet requesting that it be distributed to all riders. It had a checklist of issues along with Four demands.
- Deliveroo ends its attempt to implement a freelance system in The Netherlands.
- Sign a union contract covering the riders.
- Accept a work council (“OR”)
- Offer permanent contracts to riders that have worked three temporary contracts.
True. Though there were no sick or vacation days offered under employment contracts either.
Riders are now automatically protected from the financial cost of accidents with free rider insurance. If an injury means you’re unable to work, your earnings are protected while you recover. If you accidentally cause injury to someone else or damage their property, you are protected with up to €5 million of coverage.
Responsible for the entire contribution for the Dutch safety net (state pension, unemployment, etc.)
While this can be a daunting task, the organization Verloning.nl offers a solution in case you are having trouble with your administration, like registration at the Chamber of Commerce or filling in your tax return. They can handle all your contributions for a marginal fee of 6% of your earnings (2% discount applied for Deliveroo riders.)
If you registered as a freelancer, you will have to pay a portion of the tax. How much is dependant on what you earn. Deliveroo pays for your VAT and you can keep the 21% VAT if you stay below a total turnover of €8966 per year.
As mentioned earlier, Verloning offers a solution in case you are having trouble with your administration, like registration at the Chamber of Commerce or filling in your tax return. They can handle all your contributions for a marginal fee of 6% of your earnings (2% discount applied for Deliveroo riders.)
Actually it’s €30 to buy a thermal bag roll-top backpack. If you worked as an employee, you already have all the gear. As a new freelancer, it is not mandatory to order gear from Deliveroo, but it does need to comply with the safety and quality standards of Deliveroo.
You can get bike lights at Hema for under €4.
True. There is no guaranteed hourly rate and this will affect a riders earnings during certain hours. Though riders can also make more during peak hours.
True. Though Deliveroo does schedule accordingly based on demand, which limits the amount of shifts available to riders and the restaurants offered to customers. As of 2020, there is no longer a schedule.
True. There is no guarantee of shifts. Initially there was a scheduling system but that has since been removed. Riders have the option to log in to work whenever they want.
True. Though there is a solution if you sign on with Verloning.nl, and you won’t have to register with the Chamber of Commerce.
To cover the initial costs, there was also an initial referral bonus of €200 while your friend earns €100, but with the stipulation that they complete 30 orders within 60 days. As of 2021, this is no longer in effect.
As of now, the courts have ruled in favour of Deliveroo which has minimized the chance of risking fines by the Belastingdienst.
There is also a safeguard using Verloning.nl as they process your invoice using their KvK number, effectively making them your employee.
Without even the flexibility to work whenever you want. You still have to get permission to log into the app.
False. You can log on anytime.
These are all valid concerns. But some are based on speculation of a freelance system that continues to change. I have addressed each of these concerns against the checklist based on my experience of working with the ZZP model for the first six months.
Aside from the burdens for riders, the crux of the freelance model really comes down to making money. I attempted to see if there is any truth to this by doing a comparison in earnings between an employment contract and the freelance model.
Transition to Freelance
I tracked my earnings of 40 hours of riding under the freelance model. I rode at a pace similar to how I would ride under an employment contract. Below is what I discovered.
I was earning 32% more per hour riding as a freelancer than what I would have earned under an employment contract. That is a significant increase but it’s also misleading.
If a rider were to do 40 hours in one week, they would obviously work additional hours outside of those peak times, which means their hourly earnings would be considerably less.
In order for a full-time freelance rider to earn the equivalent per hour under an employment contract, they would have to work during peak hours.
Deliveroo aims for a payscale of between EUR 11 to EUR 13 per hour on average. That can met during peak hours. But that certainly won’t happen at other times. In order to make the equivalent of what a rider earns under an employment contract during a full-time work week, the freelance system requires a rider to work more.
That means working lunch time from 12 to 1 p.m. and evenings between the hours of 6-9 p.m. It also means working every night on the weekend (Friday thru Sunday) as well. A rider would earn less or sometimes nothing at all outside of those hours. For a country that prides itself on work-life balance, the freelance system for a full-time rider in Amsterdam doesn’t reflect it.
What a rider earns one week, also won’t necessarily translate into what they’ll earn the following week. In order to hit an earnings target, you may have to work far more in any given particular week. Especially when earnings are affected by the season, as riders for example earn far less during the summer months. This lack of financial security is a real concern and begs the question on whether the freelance model is truly flexible or indeed unstable.
Implementing a new system
There were plenty of changes to the freelance system in the early stages. The most apparent was the total overhaul of the delivery zones.
When Deliveroo first began with employment contracts, there were seven zones in Amsterdam where riders can choose to work.
This was a benefit to riders since it ensured shorter distances for pickup and delivery.
A changing landscape
Deliveroo claims that, “it happens too often that drivers have to go to other zones to deliver orders. When this order is finished you have to cycle back to your zone. This is a useless waste of time because you can’t accept orders because you’re not in your zone. By making a Powerzone, there are less crosszone deliveries and you can always continue immediately to the next order. This means that you can do more deliveries and you have to cycle less far.”
The Powerzone was introduced in late 2016 and was a combination of the two busiest zones for deliveries (Amsterdam Centrum “ACE” and De Pijp “APR.”) I was skeptical of the reasoning for this change because the claim that I couldn’t accept orders because I’m not in my zone simply wasn’t true. There were plenty of times where I received an order while in another zone.
Starting in 2018, there is just one zone in Amsterdam (not including the North as it is separated by the Ij river.) This has changed the landscape of Deliveroo and inevitably how couriers operate.
The demise of the single-speed bicycle
The implementation of one zone under the freelance model meant two things. Longer distances to travel and the demise of the traditional bicycle.
The days of riding a rickety, single-speed bicycle for deliveries is over. While there are still a handful of couriers who ride them, they’re at a disadvantage.
Since freelance riders were paid €5 per drop, speed is now the name of the game. A majority of riders have opted to use an electric bike. Deliveroo partnered up with URBEE, e-bike-to-go and Swapfiets to offer discounts on subscriptions.
Deliveroo has also allowed the use of scooters. Sadly this decision sheds any label of being green and hip. While further contributing to a problem of scooters congesting the bike lanes. But it’s been a successful recruiting tool to bring on couriers who prefer this method of delivery.
What does 40 hours of working with Deliveroo look like?
I created the video below charting my deliveries over 40 hours. It gives a good indication on what a full-time rider would bike over the course of 40 hour work week. It becomes clear that a rider requires a fast, durable bike in order to achieve any sort of a liveable income in Amsterdam.
A potential game-changer?
A unique feature to the Deliveroo freelance system is the option to reject orders.
Under the employment system, a rider would have to contact support by either calling in or messaging through the Telegram App. A conversation would ensue in which they would have to give a reason (usually the distance is too far.) Most of the time, the rider would grudgingly accept after being persuaded that there is no one else available to do the delivery.
But Deliveroo now has a feature to select “reject order” within the app. The next step is to choose a “Reason for rejecting.” Among them are:
- Distance too long
- Stacked order
- Dislike delivery area
- Difficult journey
- Restaurant waiting time
- Roads closed
- Bicycle/Scooter breakdown
Riders can also reject an order even after arriving at the restaurant, along with the option to notify them of a long wait time.
A new feature to the Rider App
Riders can now also see the destination for a delivery. This is a valuable feature as you can make the call on whether it’s worth it to deliver to a particular area. There may be times where an order would take you well out of a zone, which is not where you want to be during peak hours on a busy evening.
If I know a restaurant takes a long time to make an order and the destination is to the 10th floor of an office building, I will likely take a pass. This feature was first implemented by Deliveroo while UberEats riders for instance, were still left in the dark on where their deliveries were going.
Moving to a distance-based model
The option to reject orders did however pose a problem for Deliveroo. Long distances and avoiding certain areas likely had everyone to thinking the same thing. Certain restaurants were also known to be notoriously slow in preparing orders.
To remedy the problem, Deliveroo launched a two-month transition period throughout The Netherlands of a new system of payment based on distance.
Results from a survey showed that 70% of riders preferred to be paid by a distance model rather than a fixed drop fee per order.
The decision to move to a distance based model was a death knell to riders. Having access to an e-bike or scooter became an utter necessity. But there was a bigger problem.
A distance based model can be changed without any transparency. Meaning longer riding times for less money.
This is exactly what happened. Riders were once paid EUR 5 per drop and now it was based on distance. Certainly a rider could make more than EUR 5 per drop. But some orders would be as low as EUR 3.
In the coming months, distances became longer and the earnings decreased.
Deliveroo as always, aims to offer fees between EUR 11 to EUR 13 per on hour on average. But with longer riding times, it was next to impossible to beat the system and to earn more during peak hours, even with a fast bike. Access to an e-bike or scooter was absolutely required and now became an added investment/burden for the rider.
The effects of the Gig Economy
One of the biggest changes as a result of the freelance model involved the riders themselves. The demographics of riders completely changed as economic migrants flooded the market. Gone were the locals and anyone who simply loved to cycle for work.
Any fellowship among colleagues also disappeared. Riders were completely stoned faced, oblivious to anything besides the task at hand. This became apparent when my peace hand sign was ignored and starting conversations with anyone felt like I was pulling teeth.
I had to remind myself that I was no longer part of a company, nor was any other rider. We were independent freelancers.
Say goodbye to standards
Riders were also no longer required to wear branded Deliveroo gear. Anything but would have been considered a cardinal sin while working under an employment contract. Some riders began to use a combination of gear from other delivery companies in order to avoid paying for gear out of their pocket.
There is no training or standards to adhere to under the freelance model. Does this matter much with a delivery service?
There was a time when boxes had to be carried on your back and this was enforced by lead riders. Under the freelance system, I’ve witnessed food carried in just about any manner that comes to mind. It may not seem like a big deal unless you’re the customer who just ordered sushi.
The dilemma of wait times
Under the freelance model, I often noticed riders become increasingly agitated while waiting for an order. Riders would get into verbal fights with restaurants over wait times. Even with the option to reject an order, it didn’t seem to make a difference to a riders patience.
Deliveroo did improve the system as restaurants began to follow new timings. Riders also had to do their best to avoid unnecessary delays. Though there was still noticeable friction between riders and restaurants that continues to this day.
New rider perks
Deliveroo was putting forth the effort to keep things at bay with perks offered to riders.
This included discounts to online courses, lifestyle products and subscriptions to administrative services. They were also replacing old and broken gear free of charge.
But would this be enough to keep riders happy?
Degradation under the freelance model
Food theft became an inherent problem. Riders were picking up their orders but rejecting them once they left the restaurant.
There were countless times when I arrived at a restaurant only to be told that someone else took the order. Restaurants were fed up and rightly so, with some posting warnings on their doors.
This obviously affected customers as well. Besides having to wait for orders to be remade, there were times when orders were marked as delivered by the rider but they never were.
As a paying customer myself, I’ve witnessed this first hand as I receive a notification on the App that my order was delivered, moments after it was picked up from the restaurant.
The incidents of food theft increased during covid with some riders even boasting about how they’ve stolen food. There were designated spots in Amsterdam were riders would meet up after their shifts and feast on their stash. I suspect food theft was causing irreversible damage on several levels. Though how much this would impact future decisions by Deliveroo remains to be seen.
The End of an Era
In October of 2022, Deliveroo made the difficult decision to cease operations in the Netherlands. The final day of operations will be on the 30th of November.
As part of the consultation process Deliveroo has reached a settlement agreement with the FNV over social measures resulting from their departure, including financial compensation for the termination of the rider supplier agreement. Details have been sent to each rider working under the freelance model.
It’s not a decision Deliveroo has taken lightly and the reasons for the departure are speculative. Nevertheless, it seems like an inevitable end to an inherently flawed system of what is known as the gig economy.