Just Eat Takeaway is laying off 1,700 couriers
Just Eat Takeaway is axing 1,700 delivery couriers in the UK and returning to a gig economy model that chief executive Jitse Groen previously said was “at the expense of society and the workers themselves”.
The turnaround comes two years after Europe’s biggest food delivery group sought to differentiate itself from its biggest rivals Deliveroo and Uber Eats by hiring couriers in the UK instead of relying entirely on gig workers for takeaway.
“Just Eat UK is reorganizing and streamlining its delivery operations as part of its ongoing drive to improve efficiency,” JET said on Tuesday. “As part of the process, we proposed moving away from the employee model for couriers.”
The move comes as food delivery companies come under pressure from investors to improve profitability as demand slows following a sector recovery due to shutdowns.
Earlier this month, JET reported a five-fold rise in pre-tax losses to €5.8 billion last year, including a €4.7 billion write-down from the merger of Britain’s Just Eat and Netherlands-based Takeaway.com and the group’s subsequent from its acquisition. American-based Grubhub.
The food delivery group has hired 1,700 couriers in six UK cities since it unveiled its so-called Scoober model in London at the end of 2020, along with an operations team of around 170 people, most of whom will also be made redundant.
UK boss Andrew Kenny admitted at the time that operating costs would rise as a result of the new model, but said offering couriers an hourly wage, sick pay and pension was “the right thing to do”.
In a letter to the Financial Times in February 2021, Groen – who founded Takeaway.com in 2000 – said gig work had “led to precarious working conditions” and was “at the expense of society and the workers themselves”.
JET now uses the same self-employed model as Deliveroo and Uber Eats in the UK for food delivered by its own couriers, although orders placed by customers through the online marketplace are delivered by the takeaways’ own staff.
The company continues to operate the Scoober model in parts of continental Europe.
Just Eat reported a 10 percent drop in orders in the UK and Ireland in 2022, while revenues rose 6 percent, mainly due to restaurant price increases. According to the company’s forecast, adjusted profit will increase from 19 million euros in 2022 to 225 million euros this year.
They said the staffing changes would have “no impact” on customers or restaurant partners. The Telegraph first reported the move.