Glovo Embraces Spain’s Labor Reform, Commits to Hiring 15,000 Riders
In a significant policy reversal, Spanish delivery giant Glovo has announced plans to hire approximately 15,000 riders as direct employees, marking a major shift in its labor model. The move comes in response to Spain’s stringent 2021 labor reform, which classifies delivery platform workers as employees rather than independent contractors.
Why the Change?
- Legal Pressure: Glovo, owned by Germany’s Delivery Hero, has faced mounting fines and legal challenges for non-compliance with Spain’s labor laws. The company previously relied on subcontractors to classify riders as self-employed, a strategy now deemed unsustainable.
- Financial Impact: The transition is expected to cost Glovo €100 million in earnings, according to Reuters.
- Regulatory Clarity: In a public statement, Glovo cited a desire to “avoid further legal uncertainties” as a key driver for the shift.
Legal and Competitive Backdrop
Glovo’s decision follows:
- Multiple fines for labor violations predating the 2021 law.
- An ongoing court case against CEO Oscar Pierre for alleged breaches of the riders’ law.
- A €295 million lawsuit from rival Just Eat, accusing Glovo of unfair competition.
Government Reaction
Spanish Labor Minister Yolanda Díaz applauded the move, stating on X (formerly Twitter):
“Companies were not used to [being] told no. Glovo thought it could act outside the law.”
What This Means for the Gig Economy
Glovo’s pivot underscores the growing global push to redefine gig workers’ rights. Spain’s 2021 reform set a precedent, and other European markets may follow suit. For Glovo, the challenge now lies in balancing labor compliance with profitability in a highly competitive sector.
Stay tuned for updates as this story develops.
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