Written by Ryan White and Amelia Philpott of Cavalluzzo Law Firm, legal counsel to CUPW in the Foodora case.
Last week, the Ontario Labour Relations Board (the “Board”) released an historic decision on the “Gig Economy,” finding that food couriers working for Foodora are entitled to unionize. The decision was released in connection with the Canadian Union of Postal Workers’ (“CUPW”) certification application filed in July 2019. A successful application would see CUPW become the trade union for 900+ Foodora couriers working in Mississauga and Toronto.
Foodora argued that its couriers were independent contractors and therefore barred from unionizing under Ontario labour law. The Board disagreed. This post highlights some of the key aspects of the Board’s decision and reviews how the decision appropriately extended the Board’s jurisprudence to the Gig Economy.
Foodora is one of four major platform-based food delivery services in Toronto, alongside UberEats, SkipTheDishes and DoorDash. Foodora launched in Toronto in 2013 as a start-up named Hurrier and was subsequently acquired by a Berlin-based company that owns the Foodora brand. Pleadings filed with the OLRB in the Foodora case suggest that at least 1,200 people had made deliveries for Foodora in Toronto and Mississauga between 2018 to 2019.
CUPW’s argument was that Foodora couriers were employees and, at the very least, fell within a subset of employees known as “dependent contractors.” Ontario labour legislation has recognized dependent contractors since 1975; some of the very first certificates granted to dependent contractors arose out of dispatch-based workplaces – much like Foodora – including the taxi and haulage industries.
The definition of “dependent contractor” and the associated test under Ontario’s Labour Relations Act (“Act”)recognize a wide variety of contractual relationships in which one party is dependent on another. In roughly 85% of applications for certification outside the construction industry where employers have alleged workers to be independent contractors, the Board has found the workers to be employees/dependent contractors. This very high rate of successful certification applications suggests that the Board has consistently attempted to cast a wide net when choosing which workers are covered by the Act.As a result, while the Foodora decision may have been reasonably expected, it represents the most significant elaboration upon the Board’s dependent contractor jurisprudence since its 2001 decision in Toronto Star.
What Is a Dependent Contractor?
The Act defines a dependent contractor as an individual who performs work for another person under “such terms and conditions that the dependent contractor is in a position of economic dependence upon, and under an obligation to perform duties for, that person more closely resembling an employee than an independent contractor.”
At its core, the test is comparative: a dependent contractor is someone who provides services in a manner that more closely resembles a direct employee than an entrepreneur. In adjudicating disputes, the Board looks to eleven factors including the use of substitutes to perform the work, the party who controls that manner in which the services are delivered, the economic mobility of the service provider, and the ownership of key tools, among other factors.
The Foodora decision does not represent a departure from the Board’s jurisprudence; rather it is an extension of existing principles to the Gig Economy. In particular, the Board was required to address three distinctive characteristics of Foodora’s delivery model, all of which will be central points of contention in Gig Economy organizing campaigns to come.
- The impact of Foodora’s “App”;
- What to do with contractors who work part-time or casual hours; and
- The practice of “dual apping”.
The Foodora App
Uber, Foodora and other Gig Economy companies have consistently defined themselves as “platform marketplaces” rather than actual service providers. The claim is dubious–Foodora’s business model goes far beyond simply providing a platform for the exchange of services. The company actively recruits restaurants and members of the public, addresses complaints and issues as they arise, and manages a large workforce all in a manner that is far more consistent with a traditional provider of courier services than would be expected of a mere platform provider.
Foodora argued that the App provides couriers with greater flexibility and control in respect of the work that they do – for example, by permitting couriers to preview deliveries prior to accepting. The Board refused, however, to conflate flexibility with independence and found that the App was a marker of dependence. In doing so, the Board held that the App was the dominant tool in the relationship, far more important than any tool supplied by couriers:
The Board cannot ignore the significant disparity in the importance of the tools to the delivery of food. Just as the Board would not treat a shovel brought by the employee to the job site as equivalent to the backhoe provided by the contractor, the Board cannot treat the App as an equivalent to the bicycle and smart phone. (¶96)
… much of the couriers’ work is controlled by the App using an algorithm developed, owned and controlled by Foodora for the sole purpose of advancing Foodora’s business interests (¶122)
The Recognition of Casual Contractors
Historically, the Board has utilized full-time employment as the comparator group when assessing the claims of dependent contractors. In these cases, a contractor has derived 90% or more of their income from one source and, in many cases, devoted so much time to this source that they are incapable of taking on other work.
Evidence was tendered, in part, via four representative witnesses. These witnesses were chosen by CUPW with the intention of capturing the full scope of dependence that individual couriers have upon Foodora. In preparing statements from representative witnesses it became apparent that few, if any, couriers were entirely reliant upon Foodora for their income. Most had multiple jobs. Of CUPW’s witnesses, all had at least three sources of income, including self-employment and all earned between 30% and 80% of their income from Foodora. In addition, each of the representative witnesses worked for at least one food delivery service other than Foodora.
The percentage of income derived from Foodora was lower than that seen in previous Board cases and the frequency with which couriers worked for competitors created a possibility that the Board would find that couriers are dependent upon an industry as a whole rather than a single source of work; an arrangement the Board has previously found suggests independence.
A definition of dependent contractors that privileged contractors who mimic full-time employees, while excluding contractors who look more like casual, on-call or part-time employees would, however, be fundamentally flawed. The Board long ago stopped distinguishing between part-time and full-time employees in certification applications and there is no principled basis for doing so in respect of dependent contractors. The Board agreed:
There is a risk in placing too much emphasis on measuring economic dependence by way of a numerical threshold as urged by the employer (e.g. the percentage of work performed by an individual for a particular entity versus other entities). This is especially true for employees who work multiple part-time jobs. (¶130)
In making this finding, the Board followed its previous decision in Toronto Star and focused on the structural markers of dependence rather than simply looking at a numerical breakdown of work performed.
“Dual aping” is a practice that is related to the part-time and casual nature of courier work, but is largely unique to the Gig Economy. The Board succinctly described the practice:
Outside of the App, there was evidence of couriers performing services for more than one App, referred to as dual apping. This arose in two contexts. First, while on shift for Foodora, a courier might make deliveries for UberEats. Second, a courier might make two deliveries for different companies at the same time. In either circumstance, by virtue of the courier’s hard work the courier might increase his earnings. (¶103)
The practice was permitted as the second delivery did not interfere with a courier’s ability to complete their delivery for Foodora. Foodora argued that the practice was dispositive evidence of entrepreneurial activity, as it permitted couriers to run two Apps at once, review competition deliveries, and choose the most remunerative option (or choose to do both simultaneously). The Board, however, chose to centre the lived experience of couriers (who testified to the risks they ran when dual apping, such as discipline from Foodora), rather than valorize vague notions of entrepreneurial potential holding that: “[working for multiple platforms] is not entrepreneurial activity… It is hard work. And hard work must not be mistaken for entrepreneurial activity.” (¶104 – 105)
The practice of dual apping is central to the Gig Economy. Foodora enshrined the “right” in courier contracts (a fact that was raised many times in its arguments) and the evidence of both parties was that the practice of dual apping was widespread. Similarly, it is common to see cars driving in the downtown with both Lyft and Uber logos on them. In 2016, Uber even produced commercials encouraging contractors to “get their side hustle on.”
The notion of a “side hustle” is both good ad copy and the Gig Economy’s best argument for a finding of independence. To this end, it is employed strategically to re-cast workers who, as the Foodoradecision makes apparent, are not meaningfully different from on-call or casual direct employees. It is significant that the Board was able to see dual apping for what it is – a novel form of work distribution that is consistent with traditional of notions of dependence, rather than disruptive of the status quo:
Foodora couriers are able to make more money if they work harder, either through doing more Foodora deliveries or dual apping. But, this is akin to working multiple part-time or casual jobs where the employee decides the most desirable place to work at a particular time. If a salesperson opts to work on a Saturday because commissions will be higher, it is not considered entrepreneurial activity. If a bartender wants to work at night because there are more tips, it would not influence the classification of the bartender as an employee. Foodora couriers do not have the opportunity to increase their compensation through anything other than their labour and skill. (¶111)
The Fight Continues
As can be seen above, the decision itself is not revolutionary, though it is a thoughtful application of many years of Board jurisprudence to the Gig Economy. However, the struggle by Foodora workers to unionize is far from over. Organizing in the Gig Economy represents significant challenges, including new and difficult questions regarding the connection required to the workplace prior to permitting a worker to cast a ballot in a unionization vote, as well as concerns about the ease with which Gig Economy employers can “flood” voter lists (add large numbers of names to the voters’ list that are unknown to the union and other workers).
To this end, the
Board must now resolve more than 300 challenges to the voting eligibility of various
workers raised by CUPW. If CUPW succeeds in the next stage, the Board will open
the ballot box and let Foodora’s workers make the final call.
R. White & A. Philpott, “How the Ontario Labour Board Ruled Foodora Workers are ‘Employees’ and Not Independent Contractors”, Canadian Law of Work Forum (March 5 2020): http://lawofwork.ca/how-the-ontario-labour-board-ruled-foodora-workers-are-employees/
 This number draws from all (non-construction) applications for certification filed after the dependent contractor language was added to Ontario labour relations legislation in 1975. Of the non-construction workforces found to be independent, the vast majority (if not all) arose prior to 1998 (for example, see: Kitchener-Waterloo Record, a division of Southam Inc., . O.L.R.D. No. 432; The Citizen (Southam, Inc.), 1985 CanLII 990 (ON LRB); Atway Transport Inc., 1989 CanLII 3245 (ON LRB)
 Toronto Star Newspapers Ltd., 2001 CanLII 6537 (ON LRB)).
 Labour Relations Act, 1995 at s.1