Sunday, November 27

Is the Gorillas food delivery app the future of Europe’s concert economy?

As temperatures drop and Berlin’s blue summer skies give way to the city’s characteristic winter slate, bicycle traffic slows. Although the cold keeps many bike commuters away, a constant stream of color-coded messengers ensures that the bike lanes are not totally disabled.

The well-established deep orange and electric turquoise styles of take-out platforms Lieferando and Wolt have recently joined grocery delivery apps Gorillas, in black, and Flink, in shocking pink.

Although gorillas may sport the simplest of uniforms, it has caught the attention of cash investors and frustrated critics alike.

One of the fastest growing startups in Europe and mired in labor disputes, Gorillas is a potential harbinger of broader changes in the bike delivery industry and the gig economy.

The $ 3 Billion Gorilla in the Room

Founded in May 2020 and based on a promise to deliver groceries in 10 minutes, Gorillas achieved much-acclaimed start-up “unicorn” status by achieving a $ 1 billion (€ 858 million) valuation after just nine months. . the fastest German company to do it.

Launched in Berlin, Gorillas now operates in almost 60 cities in 9 countries in Europe and North America. According to Ben Wray of the Gig Economy Project, this reflects a broader delivery applications gold rush.

“It has had this huge expansion and Gorillas is riding the wave of this huge venture capital surge that is entering the sector in Europe right now,” Wray told Euronews.

Gorillas is currently valued at $ 3 billion (2.5 billion euros), while competitor Flink, founded in Berlin in December 2020, is valued at 2.1 billion dollars (1.8 billion euros).

Since its launch, part of Gorillas’ marketing efforts has been its focus on establishing better working conditions than rival delivery platforms.

Gorilas referred to itself as “an employee-centric company” in an email conversation with Euronews. Despite this, the company has been rocked by waves of increasingly radical strikes in Berlin, and their recent response calls into question the image they have created.

Clashes between workers and management

In response to a wave of wildcat strikes over working conditions earlier this month, the gorillas laid off hundreds of workers.

Euronews has confirmed that the layoffs were compensation for hitting.

Up to 350 workers were reportedly laid off, though Yasha, a cyclist and member of the Gorilla Workers Collective, told Euronews that he has not yet confirmed the total number of laid off workers.

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Gorilla workers have been on strike sporadically throughout this year in response to a number of complaints including late and inconsistent payments, problems with workers receiving benefits, malfunctioning bikes and safety equipment, failing to deal adequately with the accusations of harassment and what the workers claim are the unfair dismissal of their colleagues.

Seemingly minor changes to Gorillas operations, such as encouraging larger orders or extending delivery distances, also have a significant impact on the daily passenger experience.

Meanwhile, the group affirms that a measure to optimize operations has caused a shortage of personnel, a tension that has been transferred to the workers.

“It’s about forcing workers to do twice as much work as they normally would. Of course, no one is going to like that. The promise is that you will get more tips, but that is not guaranteed. It is not a restaurant, tips are not a given, ”Yasha said.

All of this, exacerbated by the company’s difficulties in managing such rapid growth, puts pressure on passengers and makes the safe delivery of cargo within 10 minutes increasingly difficult.

But for Yasha, the core of workers’ grievances boils down to something more fundamental. “The company is disrespecting us,” he said.

Laying off workers en masse does not exactly fit the public identity of the company. This summer, during another wave of strikes, CEO Kağan Sümer claimed that he would “never fire anyone for hitting.” Gorillas’ response to the most recent attacks, too like a recently leaked Slack thread where Sümer spoke of firing a worker who was trying to unionise in the spring, flatly contradicts Gorillas’ corporate manifesto.

Wildcat strikes are rare in Germany. Their legality is in dispute, although the consensus among labor lawyers is that they are illegal because striking workers technically do not comply with the contractual agreement with their employers.

This framing frustrates members of the collective, who are trying to use the recent layoffs to set a precedent for legal wildcat strikes in Germany.

“They don’t delay their contractual agreement, but they expect us to delay ours. It is always the employee who has to take responsibility and go to the labor court, it is never the company, ”said Yasha.

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Gorillas and the European gig economy

Ben Wray notes that the core challenges Gorillas employees face are different from most concert workers. “In terms of the specific problems that Gorillas workers have faced, they are somehow not as typical of most of the problems that you would see across the continent with food delivery workers. They are more typical of the problems of precarious and poorly paid work in general. Lack of equipment, not receiving adequate pay, not being respected by management, etc. ”He told Euronews.

Gorillas are distinguished by one of their biggest pro-labor selling points: Their workers are regularly hired employees rather than the gig economy standard of independent contractors.

“When we became one of the first instant delivery companies to move away from the gig economy model, we set out to ensure that our passengers were seen as true employees of the company,” said Gorillas.

Although this has not helped avoid clashes between workers and management, it provides a level of stability and security that most concert workers do not have.

According to Wray, the European gig economy is quite fractured, with labor participation significantly depending on both regulatory regimes and digital infrastructure in individual countries, however there are some unifying factors among workers.

“Concert workers are disproportionately ethnic minorities and immigrants,” Wray said. In addition to the health and safety risks for those in courier positions, stable wages are the biggest challenge facing workers in the sector.

“If you’re trading on demand, you just don’t know what your earnings will be from week to week. And with many more people entering this sector, there is downward pressure on revenues, “he continued.

This structural precariousness is compounded by instability within the startup sector. When Deliveroo exited the German market in 2019, more than 1,000 passengers were left without work less than a week in advance.

Although Gorillas’ employment model protects its workers from many of these challenges, it is clear that the company is not completely isolated from the recent militancy in the delivery applications sector, where workers have been pushing for better rights from Belgium. to Greece.

Change on the horizon

Regulators are responding to worker turmoil. In May, Spain ruled that nearly 17,000 couriers would have to be recognized as employees, not contract workers. And this decision could soon be the norm, as the European Union will announce a directive on platform workers later this year.

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Wray hopes the directive will push platforms to provide workers with regular contracts, as does Gorillas. “This seems to flatten regulation across Europe. The European Parliament has made it very clear that it expects a presumption of employment in platform work from the directive, ”he said.

Although Gorillas is ahead of the regulatory curve, it still faces challenges ahead. The more important long-term question is whether the grocery delivery model was simply a fad fueled by a pandemic or whether it represents concrete changes in consumer behavior.

According to the Gig Economy Project, the food delivery sector has doubled since the start of the pandemic. Huge investments in companies like Gorillas and Flink indicate investors have faith in the model, and Wray believes grocery delivery is likely here to stay.

“In a sense, it is part of how capitalism continually invents new needs. We never needed our take out food delivered to us, we could have just walked over and picked it up. But now many people take it for granted that takeout will be delivered. Maybe it’s the same for groceries, ”he said.

In the short term, gorillas have to deal with irate workers and the consequences of mass layoffs. Gorillas told Euronews it is working to implement a number of passenger improvements, including additional safety equipment, a review of its scheduling system and the hiring of “a significant number” of workers.

How effectively gorillas can implement these changes will determine whether their black-clad horsemen spend their time roaming the streets of Berlin or standing on picket lines. And the company’s struggles indicate that even if Europe’s gig economy evolves to look more like the Gorillas model, it certainly won’t be without conflict.

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