Hong Kong, 6 March 2024: Feeling peckish? UK-based Mexican eatery chain Wahaca will bring a cricket salsa – yes, we’re talking insects here – hopping to your door. Aussie fitness fanatics can fuel their bodies with so-called workout meals from My Muscle Chef. In the US, Chicago-based Entrée serves up Michelin-quality fare at home, complete with curated music playlist to set the mood and virtual maître d’ for 24/7 assistance.
Worldwide, the food delivery app industry is witnessing phenomenal growth, driven by smartphone ownership, busy lifestyles and, of course, the recent pandemic. According to Statista, the global online food delivery market will generate US$1.2 trillion this year. Niche apps now cater to all tastes, desires and dietary needs.
But this boom business is turning spicy in Hong Kong, where hundreds of delivery riders are on strike each lunchtime. They allege major platform operators Foodpanda and Deliveroo, plus emerging rival KeeTa, have changed fee calculations and contractual terms, leaving them worse off. Foodpanda admits to making “slight adjustments to the weightage of service fee components” while Deliveroo insists it is “re-evaluating business practices to ensure riders’ needs are met”. Right.
You have to feel for the couriers, many of them of South Asian heritage, who keep Hongkongers from going hungry amid trying conditions: long hours, traffic congestion, stifling summer humidity and the occasional dose of racism. They have asked the government to intervene, causing another headache for the Labour Department after it has been dragged into previous disputes. Since last year, it has set up a liaison group to improve communication between platform operators, riders and other stakeholders, while it has also commissioned the Census and Statistics Department to conduct a survey on working conditions in the sector.
Typically, riders sign agreements with the platforms, but these are not employment contracts. Deliveroo, for example, has a “supplier agreement”, whereas Foodpanda takes on couriers as “independent contractors”. Strike leader Nervin Deol (not his real name) tells the South China Morning Post their hourly rate and per-order fee have fallen over the years. He says earnings now vary from order to order and riders are clueless about how fees are calculated.
As the standoff continues, workers’ rights advocates are questioning what – if anything – has changed following a landmark ruling by the Labour Tribunal last summer that couriers should be classed as employees. On that occasion, six workers from the delivery platform Zeek, which went bust in December 2022, were deemed eligible for labour rights and able to claim ex gratia payments from a wage protection fund. The Labour Department subsequently received more than 300 claims for wage arrears related to Zeek and has made 278 payouts.
So, progress? Of sorts. Some cases have been deemed ineligible for being logged more than six months after the last day of work. Yet the Riders’ Rights Concern Group insists this is a point of ambiguity, highlighting that couriers are still listed on the Zeek app and the firm has yet to be officially wound up. “I just want my money,” says one rider who is owed HK$80,000. The Labour and Welfare Bureau, meanwhile has told lawmakers that granting delivery workers employee status across the board “may not be conducive to the development of the industry”.
The food delivery sector is no stranger to Hong Kong’s regulators. Foodpanda and Deliveroo have previously upset the Competition Commission, which warned their contracts with restaurants could constitute a breach of anti-monopoly regulations. The pair have since amended their practices, opening up the market to smaller companies. The Consumer Council, meanwhile, has highlighted that platforms charge up to 85% more for orders compared with takeaway prices. “Citizens should think twice about whether they need to order a delivery,” advises chief executive Gilly Wong. She also voices environmental concerns, noting that 56 orders placed by undercover council staff came in hundreds of containers complete with plastic cutlery and bags.
Furrowed brows at the food platforms, then. And our police are also hungry for a slice of the action. Some 23 asylum seekers have been arrested for allegedly working illegally by using other local riders’ accounts. Officers visited the offices of Foodpanda, Deliveroo and KeeTa as part of their probe.
In closing, it should be noted there are no sweeteners on the menu of Financial Secretary Paul Chan’s latest budget, which is aimed at restoring our city’s flagging fiscal health. Hong Kong is expected to log a deficit of HK$101 billion at the end of this month, almost double his earlier estimate. While he has surprised everyone by scrapping all cooling measures restricting property deals, some are upset he has dispensed with consumption vouchers and subsidies for electric bills and university entrance exams. Chan believes short-term pain is necessary for long-term gain and has asked for “understanding”.
Not good enough, fumes our old friend and social welfare lawmaker Tik Chi-yuen, who insists the city’s poorest will be hardest hit. Like our food delivery riders, he finds the latest belt-tightening measures rather tough to stomach.
Until next time, everybody!
Colin Cohen
Senior Partner
Boase Cohen & Collins
