Spain had a plan to fix the odd-job economy. it did not work

Under Spain’s new employment rules, courier Daniel Freitas should now be on staff at two of the country’s largest take-out companies. Yet he still roams popular restaurants with one goal in mind – to earn $ 50 a day working for food delivery apps Deliveroo and Glovo. He says he won’t be able to get off his motorbike until he has reached that amount if he wants to reach a balance of € 1,000 at the end of the month and support his family of four.

“Previously, eight hours a day was enough. Now I have to work more to earn the same amount of money, â€the 33-year-old explains. “It all started with the ‘Horsemen Act’. They [the Spanish government] said it was best for us, but it only made our jobs more precarious. Now he says he’s struggling to make ends meet after paying gas bills, an accountant, VAT and national insurance contributions which amount to a fixed monthly rate of € 289 for independent.

The riders law is the Spanish government’s response to protests against precarious employment and low wages in the odd-job economy. Designed to improve the working conditions of riders, it entered into force on August 12 without much success. Instead of forcing gig economy companies like Deliveroo and UberEats to provide employee status to their passengers, the law has made them outsource and tweak their applications to avoid changing their business models. But the most extreme escape tactic came from British unicorn Deliveroo, who revealed his intention to leave Spain entirely.

A spokesperson for Deliveroo said the decision to propose to end its operations in Spain “is not a decision we have taken lightly”. Spain proved to be a challenge for Deliveroo: in the 12 markets in which it operates, it provided less than 2% of the company’s gross transaction value. While competitors Just Eat and Glovo managed to gain more than 20 percent of the market each, Deliveroo struggled to capture more than 10 percent, with some surveys reducing its share to just 5.5 percent. It is far from the company’s ambition to be among the two largest players in the countries where it is established. “Achieving and maintaining a leading position in the Spanish market would require a disproportionate level of investment with very uncertain potential long-term returns,†the company said during the announcement.

“I was so angry when I heard it [Deliveroo] was leaving, it’s my biggest source of income and then all of a sudden I’m told it’s going, â€says Lydia Camargo, a 42-year-old from Madrid who works with Deliveroo and Glovo. “I’ve been there before when Amazon was forced to stop working with independent drivers. Now Deliveroo too. This law leaves us nothing.

However, Deliveroo’s exit is not final. The London-listed company will begin negotiations with staff and couriers this month and will make a final decision based on the outcome. However, riders are already reporting a decline in business and increasing competition. “Demand has dropped since Deliveroo announced its withdrawal from Spain,” said Camargo, who campaigned against the law with a riders’ association called Repartidores Unidos (United Riders). “I’m only doing rush hour now. Despite everything, yesterday I received two orders in two hours, compared to the average of three orders every hour.