Don’t buy into spin of big delivery platforms | IN RESPONSE

An executive at a delivery platform recently wrote a commentary for Colorado Politics calling a new Colorado bill that would provide transparency and fairness for gig workers “dangerous” and misguided.

Of course he would. Senate Bill 23-098, introduced by the first gig worker to be elected as a Colorado state representative, would address the ways tech platforms manipulate workers’ wages, remove them from their work platforms without transparency as to why, and make it difficult for them to earn more efficiently by working for multiple platforms. This is all done to amp corporate profits at the expense of workers.

Many of these delivery companies will publicly state they “believe deeply in transparency.” But the facts would disagree. Drivers are all too often taken for a ride as they gamify and push drivers toward undesirable, loss-taking work to boost their own bottom line.

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I run a company that works frequently with gig workers, specifically food delivery and rideshare drivers. Most of them enjoy their independent contractor status, but feel platforms are not actually treating them as independent contractors. With a few guardrails, this could become a more viable, sustainable workforce — which is in the interest of businesses in Colorado. No one likes the idea of government meddling with business unnecessarily. But let me explain what the delivery platforms do that has been the impetus for the proposed legislation.

It involves your money, in fact. Most of us use food delivery. Tipping happens before the actual delivery more than 95% of the time. We think when we tip a driver, the driver sees that tip and we get better service for it. Not quite the case. Your tips are used to subsidize no-tip and lower-tipped customer orders at the drivers’ expense by hiding the tip amount from a driver until after they complete a delivery. Why do delivery platforms do this? The answer is obvious: no driver would accept a no-tip delivery, because they would lose money on the job.

Many consumers think drivers can make a living just on the fee directly from the platform. Delivery platforms do not make that the case. Tips are approximately 65% of a driver's income. Given base pay is $2.50 for short distances and $3.25 or $3.50 for trips more than a few miles, if a gig driver accepts a job that they later find out is tipless, they can easily (and often do) find themselves in the position of taking a job for which their basic overhead was not covered — or by the time the fuel was accounted for, left them out of pocket, subsidizing the corporation’s profits. To illustrate, that could look like earning $6 for 12 miles of fuel and 45 minutes of work.

This practice tricks drivers into taking non-paying jobs, when it should be the business that bears the cost of a tipless order, if this is the way they’ve decided to set up their financial model. The platforms can shift this loss to their workers because they operate without any oversight in this regard. Most of the gig drivers we work with actually aren’t even asking for an increase in pay. They just want transparency — so that they can decide what work is right for them.

The platforms overreach in other ways, too. Despite the fact they have lobbied endlessly to keep their workforce categorized as independent contractors, delivery platforms make it their business to micromanage their workers, blocking drivers from using apps or other tools that help them be more efficient in their work.

They also deactivate drivers without due process. Some of these companies assert the deactivation of drivers is in the “interest of public safety.” But in reality, it’s because they turn down “too many” offers for jobs that don’t make financial sense for them to do. No one is suggesting delivery platforms should allow sex offenders to run rampant on their apps. But the claim that “giving any rationale for deactivating a driver would lead to retaliation” is nothing but fear mongering and passing the buck. It obscures the real reason they oppose the bill — so they can continue to exploit the very workers that fuel their product.

Gig workers are independent contractors and should have the freedom and transparency to do their work in the fashion any other independent contractor can. Imagine a house painter accepting a job without knowing what he will be paid, or if he will end up taking a loss for the work? Gig workers need to know: How far do they need to travel in order to fulfill their job? What is the full scope of that potential work? When is it expected that the food will be ready? What is the expected time to fulfill the job? How much will they be paid for the work? This is all information the platform hides from them.

Take a look at the hashtag #notipnotrip on TikTok and it’s clear how desperately drivers want some control and awareness over their future earnings, and how little transparency there actually is on account of delivery platform shenanigans, contrary to what they say publicly.

The bill introduced would simply rebalance the power the delivery platforms have exploited. Gig workers simply want the dignity to earn a living, and given the necessity of this workforce to local businesses and the Colorado economy, it’s in all our interest to ensure they can make a living wage.

David Pickerell is founder of gig worker app Para.