Deliveroo is based in the UK but has branched out to other countries
(Picture: AFP via Getty Images)Deliveroo has immediately ended its operations in Australia, with 14,000 deliverers and 150 office staff affected.
The UK-based company set up seven years ago Down Under but found itself unable to cope against increased market competition from brands such as Uber Eats, Menulog and Doordash. This is despite Deliveroo being one of the first to set up.
As of Wednesday, customers were unable to make food delivery orders through the app with Deliveroo Australia announcing it is being placed into voluntary administration.
The riders and drivers who deliver orders from takeaways and restaurants are considered contractors rather than employees of the company. But they will receive compensation within eight days of liquidation, with another lump sum due after the second creditors’ meeting - Deliveroo has said.
An important message from Deliveroo pic.twitter.com/uFaqNB4mRz
— Deliveroo (AU) (@Deliveroo_AU) November 16, 2022
Eric French, Deliveroo chief operating officer, said: “This was a difficult decision and not one we have taken lightly.
“We want to thank all our employees, consumers, riders and restaurant and grocery partners who have been involved with the Australian operations over the past seven years.
“Our focus is now on making sure our employees, riders and partners are supported throughout this process.”
Any driver who had completed a delivery in the past three months is eligible for four weeks of compensation pay, the company has said, with compensation calculated according to earnings across the past 12 months.
In the past, the company has been criticised in the UK for not providing enough protection to their riders, who have been treated as freelance staff.
Australian prime minister Anthony Albanese had said during his election campaign, earlier this year, he would seek to improve workers’ rights in the gig economy.
Operations in the UK are understood to be unaffected. Using aggregator statistics based on orders, customers and revenue, Deliveroo is the third most popular food delivery service in Britain, behind Food Hub and market leader Just Eat.
Deliveroo is also set to stop trading in the Netherlands by the end of November.
