Food delivery drivers paid just $10.42 an hour, union claims

A job that a union claims pays half of the minimum wage could become more commonplace if something isn’t done, it’s been warned.

Food delivery jobs that pay as little as $10.42 an hour risk undermining the broader transport industry and put Australia in a state of “national emergency”, a union has warned.

The Transport Workers’ Union has waged a campaign for regulation of the gig economy in NSW and was invited on Monday to give evidence to a federal select committee into job security.

National secretary Michael Kaine warned in his opening statement the conditions under which many food delivery riders work could be replicated in the broader transport sector if legislators didn’t intervene.

A delivery rider attending a protest in Sydney last year holds up a picture of a colleague killed on the job. Picture: NCA NewsWire / Gaye Gerard

“This model now threatens to pervade the entirety of the freight market and has moved quickly into nearly every single area of the economy,” Mr Kaine said.

“We are beyond disaster and disgrace. This is a national emergency.”

In evidence to a NSW parliamentary inquiry into the gig economy, the TWU has presented a survey that showed the average hourly wage for workers delivering food by scooter was just $10.42 per hour.

That’s less than half of the national minimum wage for casual workers at $24.80 per hour.

The rate was calculated by subtracting the costs of vehicles and equipment from an average gross hourly rate of $16.32.

The gig economy has come under heightened scrutiny after several workers were killed. Picture: NCA NewsWire / Gaye Gerard

Rideshare giants Uber and Ola told the Senate committee they were open to paying drivers a minimum wage but that it shouldn’t come at the cost of flexibility.

Australian Uber and Uber Eats officials said the company was keen to work with government to improve conditions for drivers and riders.

“We’re interested in looking at earnings as long as we are looking at the period from when they accept to when they complete a trip,” Uber Eats general manager Matthew Denman said.

“If we are talking about putting minimum rates, including wait times, we wouldn’t be supportive of that.

“In order to do that it would require us to require all drivers and delivery partners to only use our platform and worked fixed shifts in fixed places.

“We’re not supportive of the traditional employment model.”

Ola Australia legal head Ann Tan said the company’s 75,000 drivers were earning about $21 an hour, excluding costs such as car maintenance.

She said the company stopped offering accident insurance for drivers in June last year, but that was now under review.

A food delivery rider drops off food at a Sydney quarantine hotel. Picture: NCA NewsWire / Gaye Gerard

Job security committee chair Tony Sheldon asked Ms Tan what guarantees drivers had about their minimum standards.

“Drivers like flexibility. We wouldn’t want changes that would remove flexibility,” she said.

“We’d welcome policies that improve driver’s conditions.”

She said any policy that restricted a driver’s ability to choose may result in an unfair playing field for smaller players.

Senator Sheldon said agreeing to minimum rates was a start.

“If we don’t want to go back to 19th century working conditions, we need the Fair Work Commission to regulate like they do for other workers,” Senator Sheldon said.

The plight of delivery riders was highlighted at the end of last year when several workers were killed in on-the-job accidents over the space of a few weeks.

The death toll prompted the NSW government to set up a taskforce to investigate.

But the TWU claimed at the beginning of this month that the taskforce “silenced” riders’ concerns and said it would quit participating in the process.