In Taiwan, Uber Eats used to partner with local qualified third-party āCargo Transportation Businessesā to deliver food. However, it recently changed its operational structure. Under the new structure, Uber Eats operated with its wholly-owned subsidiary in Taiwan Uber Portier Taiwan Co., Ltd. to provide food ordering and delivery services to customers. Recent administrative disputes with the Bureau of Labor Insurance (the āBureauā) may shed light on why it underwent such change.
We found that Uber Eats has been fined by the Bureau for violating Article 18 of the Labor Pension Act (which stipulates that employers must file with the Bureau for the commencement of its employeesā pension contributions within 7 days from the date when an employee commences his/her job). As of March 20th, 2021, Uber Eats has filed ten administrative appeals against the Bureau. Seven administrative appeals out of ten were dismissed by the Administrative Appeal Review Committee, Ministry of Labor (the āCommitteeā). During the administrative appeals, Uber Eats claimed that the food delivery services were provided by third-party āCargo Transportation Businessesā and all delivery drivers are independent contractors who have agreements with these āCargo Transportation Businessesā, and that there is no legal relationship at all between Uber Eats and its food delivery drivers. The Committee and the Bureau held that : (i) Uber Eats has full powers over payment processing, fee structure, recruitment and qualification, management and training of drivers, Uber Eats account activation and subsequent changes, and earnings calculation for drivers, and (ii) Uber Eats stipulated rules such as the procedures of food delivery, the requirement of using Uber Eats delivery boxes, non-solicitation of customers in private, and that it suspended various delivery drivers because of multiple infractions. The Committee and the Bureau concluded that Uber Eats is the de facto employer of the Uber Eats delivery drivers.
From Uber Eatsā perspective, if the legal relationship between Uber Eats and delivery drivers is characterized as an employment agreement under law, then the Labor Pension Act and the related labor and employment laws would apply. If so, Uber Eats, as the employer, will need to contribute labor pension funds and co-contribute the Labor Insurance premium and the National Health Insurance premium for its delivery drivers. In addition, Uber Eats would be required to maintain the attendance record of all delivery drivers, pay overtime for extra time worked and even be forced to face labor unions. Therefore, the operating cost and legal obligations arising from an employment agreement relationship are much more burdensome than the ones under the original operational structure where Uber Eats only has agreements with third-party āCargo Transportation Businessesā and has no legal relationship with delivery drivers.
From the viewpoints of delivery drivers, the position taken by the government agencies can also be restrictive. For instance, if some delivery drivers are willing to take orders as much as possible, the working hours ceiling stipulated in the Labor Standards Act would prohibit them from doing so. In fact, when the New Taipei City Government approved its draft bill on the regulation of food delivery service platforms, the reporters interviewed some delivery drivers, and a few interviewed delivery drivers said that they hoped the government will not limit the daily working hours, so that their income will not be affected.
Uber Eats has filed an administrative litigation and it is noteworthy whether the Administrative Court will sustain the Committeeās decision and reasoning which held that Uber Eats is the de facto employer of the delivery drivers. We believe the outcome of such a litigation will be instructive to all internet platforms operating within Taiwan.