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Bulletin

Ontario Labour Board Says Foodora Couriers Can Unionize

Fasken
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Labour, Employment & Human Rights Bulletin

In its first gig economy decision, the Ontario Labour Relations Board (the "Board") has  decided that Foodora's food delivery couriers are dependent contractors.[1] This means they can unionize.

What Happened?

Foodora is a web services company. Through its app, the company provides an online marketplace connecting consumers and restaurants. Customers order food from restaurants using the app, and Foodora dispatches couriers to the restaurant to pick up and deliver the food to the customers. Traditionally, Foodora treated most couriers as independent contractors accessing delivery opportunities through the app.

The Canadian Union of Postal Workers ("CUPW") conducted a union organizing campaign of couriers. The union applied to the Board for certification as the exclusive bargaining agent for Foodora couriers working in Toronto and Mississauga. On August 9, 2019, the Board conducted an electronic vote and the ballot box was sealed and not counted because of legal issues in dispute.

The primary issue at this stage in the proceeding was whether the couriers were dependent or independent contractors. This was important because if the couriers were independent contractors, the application would be dismissed.  If they were dependent contractors, the application could proceed.

What did the Board decide?

The essential question for the Board was does the courier relationship with Foodora more closely resemble the relationship of an employee or that of an independent contractor?[2] To answer this question, the Board examined a series of well-established factors and evidence submitted by parties:

  • The use of or right to use substitutes to complete work: The evidence on this factor suggested that couriers were more like employees because they could not substitute another to do their work;
  • Ownership of instruments, tools, equipment or materials:  Some equipment (bike, helmet and delivery bag)  was provided by couriers but the key piece of equipment for work, the app allowing access to delivery opportunities, was the sole property of Foodora.  The Board said this more closely resembled an employee permitted to use company software than an independent contractor;
  • Evidence of entrepreneurial activity: There was no opportunity for couriers to increase their compensation through anything other than through their own labour and skill (i.e., by making more deliveries).  The Board said this more closely resembled an employment relationship;
  • The selling of one's services to the market generally: Couriers could not sell their services directly to the customer or restaurant.  This suggested that couriers were more like employees;
  • Economic mobility or independence: This factor suggested that couriers were dependent contractors because there was a complex system of incentives and restrictions similar to employment relationships with on-call employees;
  • Variation of the fees charged for the services rendered: This factor suggested that couriers were dependent contractors because couriers could not  vary their fees;
  • Extent of integration:  The Board said this factor suggested couriers were dependent contractors because they were heavily integrated into the business. In fact, the company's entire revenue depended on couriers and the couriers, in turn, depended on the app;
  • The degree of specialization, skills, expertise or creativity: This factor was neutral because there was no specialization;
  • Control of the manner and means of performing work: This factor suggested that couriers were dependent contractors because there were numerous controls by Foodora on the manner and means of performing the work, similar to those in an employment relationship;
  • The magnitude of the contract amount, terms and manner of payment: This factor was neutral because there was no comparative evidence of contract amount, and though couriers were paid by direct deposit on a weekly basis this might also exist for independent contractors; and
  • Whether the couriers render services or work under conditions which are similar to persons who are clearly employees:  This factor was not considered in detail because it was covered by other factors.

After a careful review of the evidence, the Board decided that Foodora couriers are dependent contractors and as a result, they can unionize.

Foodora couriers are not yet unionized. CUPW's application for certification has only survived this first challenge. It will proceed to the next stage to resolve disputes on the eligible vote list. Once those issues are determined, the Board will unseal the ballot box. Couriers will only be unionized if the majority of votes by eligible voters in the ballot box are in favour of the union.

Takeaways for Employers

This is a significant decision because it is the first Ontario decision on the status of gig economy workers.  But, these determinations are extremely fact specific.  A finding that Foodora couriers are dependent contractors and able to unionize does not mean that all gig economy workers are dependent contractors. With advance planning, careful design and management, it is possible for organizations to set up gig economy relationships that will be found to be independent contractor relationships.

If you are you an organization with workers in the gig economy and would like to learn more about this decision or you would like assistance structuring your working relationship with gig economy workers, please contact us.

The assistance of Maria-Cristina Cavicchia in preparing this article is gratefully acknowledged.


[1] Canadian Union of Postal Workers v. Foodora Inc. (d.b.a. Foodora) (2020), O.L.R.B. Case No. 1346-19-R [Foodora].

[2] Foodora, para. 80.

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