Labour bites

Employees not contractors

The administrators of now collapsed Foodora Australia have admitted it is “more likely than not” their food delivery riders were employees rather than independent contractors – and are owed more than $5 million in unpaid wages.

The admission is a world first and could have significant impacts on the gig economy around the world, including competitors such as Uber, Uber Eats and Deliveroo. Uber Eats and Deliveroo still claim their food deliverers are contractors, not employees.

Foodora’s parent company – German company Delivery Hero – is offering to pay $3 million to the company’s creditors, which includes underpaid workers, but also the Australian tax office and the NSW, Victoria and Queensland state offices of revenue.

The Transport Workers Union has vowed to go after the parent company for the full amount of unpaid wages.

The administrator’s report estimated that riders, if paid the lowest casual rate, would be entitled to $28 million total in wages, but were paid only $23 million. However, Foodora did not have enough money to cover all the company’s debts.

Tony Sheldon from the TWU said the union intended to pursue the German parent company, which was solvent.

“It’s a business model based on wage theft and that is the brave new world of work,” he said. “I think it strengthens the case against Uber Eats, Uber and the like." (Source: The Guardian)

Dodgy practices

Chemist Warehouse has been ordered to backpay more than $3.5 million for mandatory online training its workers did in their own time.

Some 5976 employees, making up almost two thirds of the retail pharmacy chain’s workforce, have been paid back an average of about $600 for the training following an extensive Fair Work Ombudsman audit.

The audit uncovered that while Chemist Warehouse’s head office had instructed the training be paid, many individual business owners did not comply.

In the wake of the audit, the pharmacy chain has agreed to implement numerous procedures including giving all managers and staff workplace relations training, appointing an independent auditor to assess compliance with workplace laws and setting up a hotline for employees to report potential noncompliance.

“If training is compulsory, then it is work. Young workers, in particular, are vulnerable to not realising this and giving their time for free,” Ombudsman Natalie James said in a statement.

The Fair Work Ombudsman noted Chemist Warehouse rectified the problem quickly but warned that “set and forget” instructions could become an issue. (Source:

Harsh retaliation for union action

In Iran 15 employees of the Heavy Equipment Production Company (HEPCO) have been sentenced to prison and flogging after striking over unpaid wages.

The criminal court of Arak has sentenced the workers to between a year to two and a half years in prison and 74 lashes for “disrupting public order” and “instigating workers via the internet to demonstrate and riot” after strike action against unpaid wages in May this year.

HEPCO workers have taken repeated strike action to protest wage arrears, a decline in occupational safety and uncertainty surrounding continued production. This follows years of mismanagement at the company that has seen the workforce of specialised engineers decline from over 8000 to around 1000 today.

HEPCO was once one of the most prestigious heavy equipment manufacturers in the region. The company was first privatised in 2001, bailed out by the state after it failed, and privatised again last year, resulting in large scale job losses and a decline in conditions. The company produces construction equipment under license for Volvo, Komatsu and Liebherr and other companies as well as its own brand.

Unions in Iran see the sentencing as an attempt to warn workers against taking action. (Source:

Thai WorkChoices

Mitsubishi Electric subjected locked out union members at its plant in Thailand to degrading and humiliating treatment and is now refusing to reinstate 26 union leaders and members.

The company forced the locked out workers to attend a four day camp at a military base to “learn discipline and order”, undergo five days of training by an external human resources firm, where they were expected to “reflect on their wrong doing”, one day of cleaning old people’s homes to “earn merit”, and three days at a Buddhist temple, with no regard for their religious beliefs. The workers were also made to post apologies to the company on their personal social media accounts.

Despite undergoing this process of deliberate humiliation, not all workers have been reinstated, with 24 workers waiting for reinstatement, including 10 members of a new union committee elected in June 2018.

The company requires workers who have been called back to sign individual contracts to replace the collective bargaining agreement which includes a clause where the worker must agree that they are not members of a union.

The company is an official partner of the Olympic and Paralympic Games Tokyo 2020, which is committed to “consideration of human rights, labour and fair business practices.” (Source:

Compiled by John Quessy