More money “until a resolution is found.” Delivery Hero, owner of Glovo, has assured its investors that it will provision between 30 and 45 million euros per quarter as a “contingent liability” for potential fines from the Labor Inspection for its ‘rider’ model. The German company admits that it has already received the first report for its revised model based on the new law. This amount would be added to the 400 million that it revealed a few months ago and that referred to the period between the summers of 2021 and 2023.
In the presentation of results to analysts corresponding to the third quarter, Delivery Hero assures that they continue to “evaluate the appropriate accounting treatment” of the dozens of open cases linked to minutes drawn up by the Inspection and those that will come later. In that sense, it has already set a ceiling of 400 million for this expenditure for the period ending last July. Now they update it and assure that they intend to continue communicating up to 45 million euros per quarter. It does not give a specific resolution period.
The company makes this determination after the first provisional report has been drawn up based on the new constitutional law and on its revised delivery operating model in which some changes were introduced. In the official documentation, the German group points out that the Spanish labor authority has sent “provisional employment proposals” for 49 delivery drivers (of the 19,000 it currently has). But the relevant thing is that these work for what they point out as the “flex model.”
“Taking into account the political panorama, Delivery Hero hopes that the authority continues with its procedure; Glovo does not agree with the proposal sent by the authorities and will dispute it once it is finalized,” he adds. That is to say, he will appeal the decision in court as he has been doing with all the minutes drawn up for almost a lifetime.
The company insists that they are always “open to dialogue and finding a long-term solution with the Government and interested parties in Spain.” In this sense, he insists that Glovo will continue “reviewing its model and adjusting as necessary to address any compliance concerns from the labor authority.” He insists that Uber also operates an independent model, “based on rider preference for its flexibility.”
The last two significant firm sanctions, of 79 million just a year ago and 52 million in January, were based on the regulation prior to the so-called ‘rider law’. Powers to organize action, direction and control directly, indirectly or implicitly, through the algorithmic management of the service or working conditions, through a digital platform.”