Analysis on Deliver Rider of Foodora Working as Independent Contractor Assessment 1 Answer
Assessment 1: Case Study
The main theme of the study revolves around the controversial decision by which the single Commissioner of the fair work commission has observed that the deliver rider of Foodora was working as an independent contractor. However, the perspective is not fully true to the fact, because the delivery riders of the organization are the employees of the organization.
The Pestle analysis has been presented on the online application food delivery industry specifically in Australia.
Obligations in the social media platform
In recent years, the political impacts are much more because the federal government of Australia has launched different aspects of the food delivery system. This has changed the core brand perception of the countrymen within a limited period. For the online application food delivery companies like Foodora, the social media websites are the important places where they advertise their best food collection as well as restaurant collections, from where they carry the foods of the customers to their respective dwelling destination. However, in some of the countries, it can be noticed that due to some serious conflict between the political parties, the search engine platforms are also hampered and it affected the social media pages as well (Taken for a ride, 2020). This impacts the organization in a negative manner, which has debarred them from giving food advertisements in their social media page and attracting more customers. In Australia, the search engine platforms are very popular and 51% of the people order their food online rather than going to any particular restaurant (Foodora Is Leaving Australia, 2020). On the other hand, it is noted that in some countries like North Korea, Iran and Vietnam, Facebook is blocked by the government along with Twitter, which is also banned by the government is several countries as well (Foodora Is Leaving Australia, 2020).
Figure 1: Social media obligations for online food delivery organizations
Source: (Foodora Is Leaving Australia, 2020)
Decreases in the sales and growth
The economic and financial environment of the country is also impacted by the online application food delivery companies like Foodora. At the time of positioning of the brand, the organization look for the authenticity of the economic environment and the purchasing power of the buyers (Foodora riders, 2020). However, due to the external regulations from the government on monetary affairs, the online application food delivery companies like Foodora can track the dynamic pricing based on the availability and quantity of foods those are delivered by the hotel chains in Australia. Within the online application food delivery companies, the purchasing power of the buyers should be constant and should be increasing because there is a constant rise in food and beverages items in the hotels and restaurants. That is why the price displayed in the application of online food delivery companies like Foodora, is quite high according to the regions and places of the country (Foodora riders, 2020).
Dispersive choices of the customers
The social culture is much important for the online application food delivery companies like Foodora because the foods are also dependent on social beliefs. There are different communities live in Australia who has different demands on the food (Zhou, 2020). That is why it impacts the sales and profit of the organization, which is termed as the "social impact". The vegan customers of the country should be delivered with vegan foods and it is the responsibility of the company to tie up with some of the hotels and restaurants who can supply that kind of foods in that area according to the customer choice. However, in some of the occasion in the country, like Christmas, Chinese New Year and Halloween, the sales of online application food delivery companies like Foodora increases (Zhou, 2020).
Payment reduced for the delivery riders
Due to the lack of technological advancements in the online application format of Foodora, to direct the drivers in picking more orders from the restaurant, the pay scale of the riders have been reduced (David Chau, 2020). In the previous months, Foodora used to pay their delivery riders within an hour after delivery but in the recent phase, due to the technological declination, the payment conditions of the riders are not increasing for the last few months (David Chau, 2020).
The supply of online food is decreasing
It can be observed that due to the core problem or issue, different riders have threatened the organization and they will also leave the company due to the worsen payment structure, which has been changed recently (Ruiter, 2020). Followed by the core incident, Foodora also terminated a huge number of employees for their threatening to the organization. Due to these incidents and situations, the online food delivery platform is hampered the customers are not getting the right orders from the hotels and restaurants. This has declined the core environmental conditions of the online food delivery platform (Taken for a ride, 2020).
Actions of Trade Worker’s Union
In this perspective or situation, the employees are turning to be independent contractors due to these different problems and issues. It can be observed that they have got immense support from the Trade worker's union where they filled up the unfair dismissal claims against Foodora (Taken for a ride, 2020). However, Foodora has also protected their situation as they have claimed that riders were not protected by the "unfair dismissal regime" as they used to work as an independent contractor and not as an employee.
It can be concluded that Foodora has misjudged the capability of its employees and that is the only reason due to why the company has not earned the maximum profit in the recent quarter of the financial year. It can be observed that within the decision taken by the Fair Work Commission, the engagement of the union of the delivery riders also play a huge role as they frequently challenge the engagement arrangements and they are also having a giant competition with the Uber and Deliveroo.
- The organization should increase the pay-scale of the workers or the delivery riders for increasing the level of customer satisfaction
- Foodora should set up a contract with different restaurants so that they can meet the employee satisfaction as well as customer demands.