Deliveroo accused of paying drivers below agreed minimum of £12 an hour

Deliveroo has been accused of ­paying drivers below a minimum pay floor the company agreed earlier this year as part of the first-ever union ­agreement to cover earnings in the gig economy.

Analysis carried out by Rodeo, an app that helps gig economy workers track their payments, showed that of 531 food orders completed in the past four months, 278 fell below the rate of £12 an hour agreed with the GMB union in May.

Martin Wills, an Exeter-based driver working for the company since 2021, asked Rodeo to ­examine his delivery records because he felt he was not being paid fairly by Deliveroo, which heralded its first-ever profit last month of £1m for the first six months of 2024.

“Deliveroo has gained lots of positive PR [from the deal] but I found 48% of my orders were below the pay floor. I’m fed up with big companies breaking their promises to working-class people and I’m determined they should be held accountable,” he said.

Wills, 39, joined the gig economy so he had the flexibility to care for his four children, including a daughter who has a rare type of ­epilepsy.

He claimed Deliveroo appeared to base its pay calculations on unrealistic delivery estimates: “Deliveroo’s algorithm is not properly taking into account waiting times, traffic and people taking longer to answer the door than usual … basically, real life.”

The app recently sent Wills to pick up groceries from a supermarket 17 minutes before the order was ready to collect.

This delay pushed his ­earnings below the pay floor as it took him a total of 32 minutes to complete the order. He was paid £6.69, which equates to £12.54 an hour.

This is below the pay floor for car drivers, which is £12 plus ­vehicle expenses of £4.27 an hour.

“Most worrying, there’s no way that I could hit the pay floor without ­driving at about 60 miles per hour in a 30-mile-an-hour zone,” he said.

Alfie Pearce-Higgins, who co-founded Rodeo, said the analysis showed Deliveroo was failing to meet even its limited public commitments. “We have looked at a small sample of Deliveroo’s total deliveries … and found hundreds of examples that are below the supposed pay floor.”

A Deliveroo spokesperson said: “We guarantee all riders earn at least £12 an hour while completing a delivery and the majority earn far more than this. This is audited annually to ensure compliance with this policy.”

The firm added it was committed to providing flexible work, attractive earnings and protections, such as sickness cover, insurance and ­training opportunities.

Deliveroo entered into a voluntary agreement with GMB in 2022 amid legal challenges in the supreme court to its employment model and strikes led by the grassroots Independent Workers’ Union of Great Britain (IWGB). The IWGB criticised the deal as a “ cynical PR move ” at the time but Deliveroo’s founder and CEO, Will Shu, insisted it would give ­riders “guaranteed earnings”.

Deliveroo first promised riders would earn at least the national minimum wage in May 2022, when it was £9.50 an hour for those aged over 23. That was raised to £12 an hour, plus expenses, during negotiations with the GMB.

Related: ‘I wouldn’t wish this on anyone’: the food delivery riders living in ‘caravan shantytowns’ in Bristol

However, drivers can still end up earning below the national minimum wage because the calculation does not factor in waits between orders. There have been reports of riders earning as little as £2 an hour over the entire time they are logged into the app.

The Labour government has watered down plans to bring in a single status for all employees, which would give gig economy workers the same rights as employed staff. Instead, it has said it will consult on a simpler employment framework.

Tom Warnett, the GMB’s Deliveroo national lead, called on the company to ensure every job was paid ­correctly.

“Deliveroo has reached profitability with the hard work of tens of thousands of couriers,” he said. “They deserve a share of that success with fair pay and treatment.

“We are proud our members have delivered the first and highest ­minimum pay guarantee in the ­sector. Reports, including from GMB ­members, that the pay floor is not being applied are concerning.”