Glovo handed US$78m fine by Spanish authorities for recruitment violations

SPAIN- Spain’s labor ministry has fined food delivery platform Glovo 79 million euros (US$78 m) for violating a law requiring food delivery companies to formally hire riders.

“Glovo has violated fundamental labor rights and they have obstructed the work of the investigation. For this reason, action has been taken against this company,” Labor Minister Yolanda Diaz stated.

According to Spain’s labor ministry, the local subsidiary of German multinational online food-delivery service Delivery Hero failed to contribute to social security and make other payments from 2018 through 2021.

The ministry asserts that it did not hire its delivery riders pursuant to written contracts.

Glovo declared that it would challenge the judgment arguing that the study was carried out before a new law requiring the hiring of riders by food delivery services went into effect.

Although this took effect in 2021, some gig economy workers contend they still do not have a written contract.

There has been a rise in freelancing due to Glovo’s refusal to offer work contracts to more than 10,600 riders in the second-and third-largest cities in Spain.

“I’d rather work for a paycheck than have to seek (for orders) for myself,” says Giancarlo, a 25-year-old Italian delivery driver.

Pierre has previously been a busy angel investor, supporting companies including meat substitute manufacturer Heura, retail property investment site Beanstock, and insurance provider Cleverea.

Meanwhile, co-founder and CEO of the Spanish delivery startup Glovo, Oscar Pierre, is forming a new venture capital fund and is looking to add an investor to the team.

According to a news website, which has had all information removed, it will be named Yellow Fund and will invest in firms from the idea stage to Series A.

According to Sifted, Pierre discussed the idea at a gathering in Barcelona and stated that the fund would be €50 m, of which he would personally spend €10 to €15 m.

The fund’s website said that Pierre will be donating at least 51% of his wealth to “the Yellow Foundation” which will finance the fund as part of its broader mission to “give back to society and the planet through empowering tech entrepreneurship”.

Pierre has previously been a busy angel investor, supporting companies including meat substitute manufacturer Heura, retail property investment site Beanstock, and insurance provider Cleverea.

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