Riders providing food delivery and courier services are entitled to benefits stipulated in the Labor Code, according to the Department of Labor and Employment (DOLE).
DOLE issued the clarification in a landmark advisory which sought to settle the question of whether motorcycle riders are employees or independent contractors.
Labor Secretary Silvestre H. Bello III cited the “four-fold test” in determining if there is an employer-employee relationship between riders and the concerned digital platforms.
Under the four-fold test, such relationship exists if a concerned employer has authority over its worker in terms of their selection, payment of wages, dismissal, and conduct. Bello said the DOLE has observed that such relationship exists between riders and digital platforms.
“All delivery riders who are deemed employees of the digital platform company shall enjoy the minimum standards and benefits,” Bello said.
Benefits prescribed by the Labor Code include minimum wage, holiday pay, premium pay, overtime pay, night shift differential, service incentive leave, 13th month pay, separation pay, retirement pay, and the right to security of tenure, self-organization, and collective bargaining.
Employees must also be enrolled in the Social Security System, Philippine Health Insurance Corp., and Pag-IBIG Fund.
Under the law, employers must adhere to occupational safety and health standards.
Bello said riders who have no employer-employee relationship with the delivery apps, as determined by the four-fold test, are considered independent contractors.
“Delivery riders deemed independent contractors or freelancers shall be governed by their respective contract or agreement with the digital platform company.”
DOLE issued the advisory after Foodpanda sanctioned its riders who raised questions about the delivery app’s payment scheme.
Nagkaisa Labor Coalition Chairman and Federation of Free Workers (FFW) president Sonny Matula welcomed the new advisory from DOLE.
He said the advisory will better protect delivery riders not only of Foodpanda but also of other digital platforms like Grab.
Matula has been calling on DOLE to release such guidelines. He alleged that digital platforms do not treat their riders as employees.
“In the Philippines, gig workers are generally considered not employees. They are not paid a regular wage, but are paid for the ‘gig’ work they do—like delivering passengers, food or parcels,” Matula told the BusinessMirror via SMS.
With the advisory, Matula said his group expects more riders of digital platforms will be encouraged to organize a union.