November 14, 2019

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SkipTheDishes faces legal challenge about drivers

Hey there, time traveller!
This article was published 30/7/2018 (472 days ago), so information in it may no longer be current.

Hey there, time traveller!
This article was published 30/7/2018 (472 days ago), so information in it may no longer be current.

A rapidly expanding food-delivery service faces a potential class-action lawsuit over its treatment of delivery drivers, an action that could lead to other legal challenges in today's gig economy.

A court challenge launched by Winnipeg SkipTheDishes courier Charleen Pokornik claims the company avoids providing proper employee benefits — including minimum wages, vacation days and overtime pay — by classifying its couriers as independent contractors instead of employees. Pokornik has been a courier since November 2016 and is arguing she and other delivery drivers across the country are entitled to employee benefits they don't currently receive, and that SkipTheDishes is violating labour laws by not providing them.

The statement of claim, filed in Manitoba's Court of Queen's Bench July 25, asks the court to certify a class action that aims to seek compensation for all couriers in the eight provinces in which SkipTheDishes operates.

STELLA'S SKIPS SKIPTHEDISHES

Pricey SkipTheDishes service fees have prompted one of Winnipeg's staple restaurant chains to stop deliveries and prioritize dine-ins.

When Stella's Cafe and Bakery first signed up to join the Winnipeg-based delivery service in 2012, vice-president Grant Anderson said Skip charged about 10 per cent for every order made through the service.

Pricey SkipTheDishes service fees have prompted one of Winnipeg's staple restaurant chains to stop deliveries and prioritize dine-ins.

When Stella's Cafe and Bakery first signed up to join the Winnipeg-based delivery service in 2012, vice-president Grant Anderson said Skip charged about 10 per cent for every order made through the service.

Anderson said the fees are now as high as 30 per cent, having tripled since the mobile-and-online delivery business recruited Stella's to become a client five years ago.

"Over time, we discovered it didn't really fit Stella's as a brand," Anderson told the Free Press Monday, adding that the increasing delivery charges initiated a conversation about the chain's relationship with the delivery service last year.

"When they first started out, it seemed like (Skip) was going to be fairly exclusive. And over time, it kept on growing and growing and growing and the exclusivity component was lost along the way."

The delivery service relies on a base percentage of sales and late fees, he said. When an order wasn't immediately ready for pick-up, Skip charged Stella's extra for the driver's wait time.

One of the first local restaurants to sign up, by the time they opted out of the delivery service, they were just one name in a list of dozens of Winnipeg options. Today there are hundreds of Manitoba shops listed on Skip -- from independent pizza joints to upscale sushi restaurants to Winnipeg breweries, and something for every craving in between.

The restaurant chain stopped using the service in April 2017.

Anderson said restaurant operators have an "underlying fear" that they are missing out on sales if they don't sign up for a service like Skip or Uber Eats, which is coming to Winnipeg at the end of the summer.

"A lot of people get into it with this idea that it's going to either solve problems of make them competitive with everybody else, but that's not necessarily true.

"Revenues don't necessarily solve problems for you. If you lose 30 cents on every widget you make, you can't make it up in volume."

Stella's profits did suffer for a little while after they stopped using Skip, he said, but things have since improved.

Now he said they are refocusing their brand and amping up customer service in their dining rooms at their seven locations across the city.

The business, which began its operations in Winnipeg and maintains offices in the Exchange District, has become the fastest-growing online food delivery service in North America, offering deliveries from more than 10,000 restaurants in more than 70 cities across Canada and into the U.S., according to its company website. But Pokornik's claim raises questions about whether its drivers are being treated fairly under employment standards law.

In an emailed statement to the Free Press, a company spokesperson for SkipTheDishes emphasized couriers aren't employed by the company and are considered "independent contractors." There are tens of thousands of couriers active on the SkipTheDishes network nationwide, the company says.

"This matter is before the courts and we look forward to responding through the appropriate channels," the statement said.

Paul Edwards, a Winnipeg lawyer for one of the two firms representing Pokornik, said labour laws have been "well-established", but he argues they aren't being followed in this case.

"The company has certainly cast them as independent contractors and what we’re saying is, they’re wrong. In fact, these drivers are employees. That’s the issue. Now, they certainly will not agree with that, and therein lies the case which the courts are going to have to deal with," he said.

Former delivery drivers who spoke to the Free Press confirmed couriers aren't paid an hourly wage, and expressed frustration over situations where they said they'd lost money on certain deliveries because of out-of-pocket costs.

They're paid per food order they deliver, collecting delivery fees that range from $4 to $7, plus tips. They're responsible for paying for their own gas, vehicle maintenance and car insurance. SkipTheDishes tells couriers what type of car insurance they must have in order to work for them, according to the statement of claim.

Jeremy Short is a former driver with the food delivery service SkipTheDishes.

JOHN WOODS / WINNIPEG FREE PRESS

Jeremy Short is a former driver with the food delivery service SkipTheDishes.

Former couriers who spoke to the Free Press said that, although they got to choose their own shifts and availability, they bore costs out of pocket to become couriers, including renting a thermal food delivery bag for between $70 and $80, the cost of which wasn't fully refunded when they returned it at the end of their employment.

Jeremy Short, who worked as a courier for SkipTheDishes between 2015 and 2016, said he didn't feel as though the company "cared that much about their drivers."

"(The drivers) are just as big a part of the company as people working in the main office, I would say. They’re the ones who actually deliver the food, make sure that the customers are satisfied," the 23-year-old said.

"I’m not against SkipTheDishes. I still think it’s a good company. I know it’s growing, it’s doing really well, but I just feel like they don’t treat their – I don’t know if I should say employees – but their couriers, their drivers, as well as they should. Because without the drivers, the whole business just won’t work at all."

Manitoba's Employment Standards Code doesn't apply to independent contractors, but the province's Employment Standards offices handle complaints from those who believe they should be considered employees instead of contractors.

John Godard, a labour and employment professor at University of Manitoba's Asper School of Business, said other countries and other jurisdictions in Canada have grappled with the same issues because of the growth of a side-gig industry that focuses on part-time work and gives workers the ability to set their own hours.

"This is the kind of thing that’s been going on everywhere, because the laws, when they were enacted, just did not envision this type of employee" - John Godard, a labour and employment professor at University of Manitoba's Asper School of Business

"This is a very common problem with the so-called gig economy," he said, using the term for a labor market characterized by short-term contracts or freelance work, as opposed to permanent jobs.

"This is the kind of thing that’s been going on everywhere, because the laws, when they were enacted, just did not envision this type of employee," he added, saying some labour legislation is too vague about the difference between an employee and an independent contractor — something other jurisdictions, including Ontario, have tried to clarify along with the rise of companies such as Uber that use independent drivers.

The court process for the proposed class-action lawsuit will likely be a lengthy one, Edwards said, and lawyers don't know how many couriers could be involved or what kind of monetary compensation they would seek.

"The companies themselves are going to become more aware of what they need to do to make sure they’ve covered off the legal risks. It is an emerging area and it’s one that we’re hopeful the drivers for SkipTheDishes will be able to be treated fairly according to the terms of the employment standards legislation in each of the provinces in Canada," Edwards said.

katie.may@freepress.mb.ca

Twitter: @thatkatiemay

Katie May

Katie May
Justice reporter

Katie May reports on courts, crime and justice for the Free Press.

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Updated on Monday, July 30, 2018 at 8:34 PM CDT: Adds new background photo

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