Spain fines Glovo, a subsidiary of Delivery Hero, with 78 million dollars for a labor violation

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Spain has fined Glovo, the local unit of Delivery Hero (ETR: DHER ), 79 million euros ($78 million) for an alleged breach of labor law, the company said on Wednesday. Minister of Labor, Yolanda Díaz.

Glovo said it would appeal the decision, in which the Labor Ministry alleged that it had not contributed to social security and made other payments from 2018 to 2021, since it did not hire its couriers under formal contracts.

“(Glovo) has violated fundamental labor rights and has obstructed the work of the investigation. And for this reason, action has been taken against this company,” said Díaz.

“The weight of the law is going to fall,” he added.

In May 2021, Spain passed one of the first laws in Europe related to the rights of casual workers with short-term contracts, requiring food delivery platform drivers to become employees with formal employment contracts. This came into force in August of that year.

But some, like 19-year-old Peruvian Giancarlo, who works at Glovo, say they have not yet been offered a formal contract.

“I would prefer to work for a salary, easier than looking for myself alone and not having orders fall,” Giancarlo told Reuters in Barcelona. He preferred not to give his last name because his residence permit in Spain is pending regularization.

However, Nicolli, a 22-year-old Brazilian in Barcelona, ​​said she prefers to be self-employed because “we have more freedom to work and we earn much more.”

The company has refused to offer employment contracts to more than 10,600 couriers in the country’s second and third largest cities, Barcelona and Valencia, since the law came into force last year, the Labor Ministry said in a statement.

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One of the unions representing the riders, CCOO, said in a statement that it welcomed the strong action taken against the delivery problem.

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