Coronavirus: KFC, Pizza Hut, hiring drivers as contractors not employees for level 3

Friday, 24 April 2020

KFC accounted for nearly half of Restaurant Brand's total New Zealand sales of $795 million in the 12 months to June 2019.

KFC will start home deliveries from next week, but delivery drivers will not be entitled to minimum wage, sick leave or annual leave.

The fast food giant's owner Restaurant Brands said KFC, along with Carl's Jr and Pizza Hut, would offer contactless online deliveries from Tuesday April 28, when the country moved into level 3.

Restaurant Brands has advertised jobs for full-time independent contractors to deliver Pizza Hut and KFC for $9.50 per delivery.

Independent contractors are not entitled to minimum pay, sick leave or holiday pay.

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Restaurant Brands has advertised several jobs online for full-time independent contractors to deliver Pizza Hut and KFC.

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'Delivery is a key part of our business and demand from customers to have hot delicious food delivered to their doorstep is growing,' the job listing said.

First Union national secretary Gerard Hehir says he is concerned about how much contract drivers will earn and what health and safety protections the company was taking for them.

'As an independent contractor, you will be responsible for your own tax as well as mileage and vehicle running costs.'

Restaurant Brands has been contacted for comment.

KFC accounted for about half of Restaurant Brand's total New Zealand sales of $795 million for the 12 months to June 2019. Restaurant Brands made a profit of $35m in that period.

The advertisement said Restaurant Brands was offering insurance through an independent insurer for a fee of 10 cents per delivery.

The company received $21.8m for 3651 staff from the Government wage subsidy scheme.

Restaurant Brands says it will deliver Carl's Jr through Uber Eats.

The Labour Inspectorate took several Pizza Hut franchise owners through the Employment Court in September last year, arguing that 28 delivery drivers were employees, not independent contractors. The case was currently on hold.

The Ministry of Business, Innovation and Employment had been approached for comment.

Competitor Domino's was employing 1000 delivery drivers for level 3, paying them the minimum wage and reimbursing them for deliveries made in their own cars.

Uber driver Amanda High says she expected the company to provide PPE and sanitiser for drivers.

The company had also provided face masks, gloves and sanitiser to its drivers.

Unite Union national secretary Gerard Hehir said the union, which represented Restaurant Brands employees, was concerned about how much contract drivers would earn. He questioned the health and safety protections the company was taking for drivers' safety.

'It's problematic because contractors aren't covered by the same protections as employees. A significant part of their income comes from tips,' Hehir said.

'These jobs are usually taken up by vulnerable workers who may not know their rights.'

Dundas Street Employment Law partner David Traylor said under the Health and Safety Act, a person conducting a business or undertaking (PCBU) has a duty to ensure, 'so far as is reasonably practicable' the health and safety of all workers, including contractors.

The PCBU duty applied to workers when they were 'at work', but that did not mean it only applied to when they are within a PCBU's premises, Traylor said.

'A workplace is a 'place' where work is being carried out, and a 'place' specifically includes a vehicle. On that basis, a contractor undertaking deliveries as part of their work would likely be at work and the PCBU duties would apply.'

Uber drivers had also been asking for the company to deliver cleaning supplies to drivers as it had done in the United States.

A spokesman for Uber said the company was providing financial assistance for drivers diagnosed with Covid-19, or personally placed in quarantine by a public health authority due to risk of spreading the virus.

He said Uber was also reimbursing drivers taking trips on the platform up to $20 for the purchase of hand sanitiser and car disinfectant this month. This would also become available to Uber Eats drivers from next week.

Wellington-based Uber driver Amanda High said she expected Uber to provide greater support for its drivers including personal protective gear.

High said she had stopped driving during the level 4 lockdown for safety reasons, but was considering driving for Uber Eats when the country moved into level 3 next week.

'I think since Uber knew since January there was a virus that they should have been more organised for their drivers. They had plenty of time to prepare and source PPE,' High said.

'If they were not going to provide themselves then they should have at the very least paid us out an amount to buy our own.

'As far as Uber Eats, I believe they should be helping during this time by reducing their commissions to food outlets which in turn would also help their drivers get more work and they would make more money as well overall.'

McDonald's and Restaurant Brands' Carl's Jr will deliver food through Uber Eats.

Uber has come under fire for refusing to reduce its commission rates, which range between 30-35 per cent. Prime Minister Jacinda Ardern encouraged New Zealanders to order food deliveries from local businesses directly rather than using Uber Eats.

This story has been corrected to reflect Gerard Hehir is national secretary at Unite Union