Delivery company Glovo has been fined €79 million by Spain’s Labor Ministry for breaking a law requiring food delivery services to formally hire workers.
The labor authorities handed down the record fine for hiring 10,614 workers as “bogus self-employed” (“falsos autónomos”) rather than as formal or permanent employees, in violation of the Iberian country’s social security law.
On Wednesday, Spanish Labor Minister Yolanda Díaz (Unidas Podemos/GUE-NGL) accused Glovo of “violating” the labor rights of its workers and “obstructing” investigations by the labor inspectorate, which she described as “extremely serious” in a social and democratic state , in which companies “have to abide by the law,” EURACTIV’s partner EFE reported.
Glovo was founded in Barcelona in 2015. It is an on-demand service that buys and delivers products through its mobile app. Grocery delivery is the most popular service.
A controversial “ley rider” law, in force since August 2021, obliges digital delivery platforms in Spain to hire their delivery drivers as regular employees, among other things, RTVE reported.
Until the law passed, most delivery platforms hired drivers on a freelance basis.
On Monday, Spain’s Labor Ministry began filing multiple infringement cases against the company at its Barcelona headquarters and at its Valencia office.
Labor authorities have fined Glovo’s office in the Catalan capital €63.2 million and the company’s Valencia branch €15.7 million.
During inspections in Barcelona, the labor inspectorate found that the employment relationship between the company and at least 8,331 workers was of a regular and permanent nature, although they were self-employed for the company.
The company was fined €39.06 million for not registering them as regular full-time workers with Spanish social security.
The Spanish Ministry of Labor has also issued a comparative report for the company’s failure to pay social security contributions for all these workers, with a penalty of 24.16 million euros.
In Valencia, the Spanish labor authorities confirmed the permanent employment relationship of 2,283 workers with Glovo and issued a €10.7 million violation report and a €5.05 million settlement report, and imposed a €2,500 penalty for “obstruction of labor inspection”.
So far this year, Glovo has already paid €42.2 million in social security contributions and another €84.4 million for violations, in addition to €14,000 in penalties for obstructing the labor inspectorate.
(Fernando Heller | EuroEFE.EURACTIV.es)