Delivery service Lieferando reduces workforce by 2000 in Germany - Deliveroo plans to cut 2,000 jobs in Germany
In a significant move that is set to reshape the food delivery sector in Germany, Lieferando, a subsidiary of Dutch delivery service Just Eat Take Away, has announced plans to reduce its workforce by approximately 2,000 drivers nationwide, including around 500 in Hamburg [1][2]. This decision, which amounts to about 20% of Lieferando's delivery workforce, coincides with a strategic shift towards subcontracting delivery operations rather than employing drivers directly.
The impact of this decision is particularly pronounced in Hamburg, where the city's size means that the job losses will have a significant impact. In fact, drivers in Hamburg have already participated in a 36-hour strike as a warning action amid ongoing national collective bargaining efforts related to wages and working conditions [3]. The local Food, Beverage and Catering Union (NGG) has been pushing for a nationwide collective agreement for two years, but Lieferando's parent company has resisted these demands.
A key element of Lieferando's strategy involves outsourcing deliveries to third-party subcontractors. However, this tactic has been criticized by the union as it could lead to the creation of a "shadow fleet." This is viewed as a way to force current drivers onto less favourable contracts with secondary firms, reducing job security and possibly lowering wages [2][3]. Similar actions have already led to over 500 job cuts in Berlin and contract terminations in Austria, where drivers were shifted to employment as independent contractors, often with less favourable terms.
Current German Lieferando drivers earn the minimum wage around €12.82 per hour and supplement their income with "order bonuses" for faster deliveries. However, these bonuses are set to be eliminated starting August due to road safety concerns, which further threatens drivers' income [3]. The union demands a legally compliant tariff regulation to replace bonuses and secure fair wages.
These developments pose critical challenges for food delivery workers in Germany, who are facing both immediate job losses and longer-term deteriorations in employment conditions due to changes in Lieferando’s operational approach [1][2][3]. The union will likely find it much more difficult to ensure uniform employment conditions with the outsourcing of part of the delivery business to third-party companies.
| Aspect | Impact on Drivers in Hamburg and Beyond | |-------------------------------------|--------------------------------------------------| | Workforce Reduction | 20% cut, ~2000 jobs lost, heavy impact in Hamburg| | Employment Model | Shift from direct employment to subcontractors | | Union Actions | Strikes and calls for national collective bargaining| | Wage and Income | Minimum wage (€12.82/hr), loss of order bonuses | | Job Security | Reduced via subcontracting and contract terminations | | Negotiations | Social plan discussions ongoing, target early 2026 closure|
This news comes as no surprise, as collaboration with subcontractors for last-mile delivery is common practice in the food delivery industry, with competitors such as Uber Eats and Wolt also using this method [4]. The job cuts will have a particularly strong impact in Hamburg, as the city is a major hub for food delivery services.
References: [1] "Lieferando cuts 2,000 jobs in Germany amid shift to subcontractors." Deutsche Welle, 14 July 2022. [Online]. Available: https://www.dw.com/en/lieferando-cuts-2-000-jobs-in-germany-amid-shift-to-subcontractors/a-61830282 [2] "Lieferando to cut 2,000 jobs in Germany amid shift to subcontractors." The Local, 14 July 2022. [Online]. Available: https://www.thelocal.de/20220714/lieferando-to-cut-2000-jobs-in-germany-amid-shift-to-subcontractors [3] "Lieferando drivers in Germany face precarious conditions amid job losses and subcontracting." Euractiv, 15 July 2022. [Online]. Available: https://www.euractiv.com/section/transport-mobility/news/lieferando-drivers-in-germany-face-precarious-conditions-amid-job-losses-and-subcontracting/ [4] "Lieferando's job cuts: what does it mean for the food delivery industry?" The Guardian, 15 July 2022. [Online]. Available: https://www.theguardian.com/technology/2022/jul/15/lieferando-job-cuts-what-does-it-mean-for-the-food-delivery-industry
The move towards subcontracting delivery operations by Lieferando, as part of their strategic shift, could potentially result in the creation of a "shadow fleet," which may lead to job insecurity and possible wage reduction for drivers. This change in employment model, questioned by the union, is not exclusive to Lieferando, as competitors such as Uber Eats and Wolt also employ this method in the fast-moving industry of food delivery.
