Are food delivery workers “entrepreneurs”?

. Jan 29, 2020
A delivery app bike boy wearing a raincoat check his mobile phone in downtown SP business district A delivery bike boy in São Paulo's business district. Photo: N. Antoine/Shutterstock

Good morning! We’re covering today a recent verdict classifying food delivery app workers as “entrepreneurs.” Brazil’s disregard for natural disaster prevention. And the biggest case of modern slavery finally goes to trial.

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Labor court denies employment relationship to app workers

A labor court in São Paulo dismissed

a request to impose employer responsibilities on food delivery app iFood. In practical terms, the decision denies iFood&#8217;s delivery drivers the right to monthly deposits into a severance fund—accessible in the case of redundancy—insurance against workplace accidents, a guaranteed Christmas bonus, paid vacations, among other benefits.</p> <p><strong>Why it matters.</strong> Work for delivery, courier, and transport app companies is one of the <a href="https://brazilian.report/business/2019/07/10/pizza-boom-delivery-apps-brazil-market/">main drivers of positive recent job creation numbers</a>—the market is estimated at 4 million people. According to Brazil&#8217;s official statistics agency IBGE, these new jobs have a direct link to high unemployment rates.</p> <div class="flourish-embed" data-src="visualisation/1122439"></div><script src="https://public.flourish.studio/resources/embed.js"></script> <p><strong>Be your own boss. </strong>The judge in the case agreed with the tech company&#8217;s arguments that food delivery drivers are autonomous workers—that is, they are their own bosses. In many firms, they are labeled as “entrepreneurs”—a move pulled in foreign countries to avoid corporate liability.</p> <p><strong>Yes, but … </strong>This argument has been debunked by many legal scholars, who point out to the fact that tech companies constantly monitor their activity and create bonus programs to encourage them to work more—and deliver products faster. Last year, a driver of delivery app Rappi died of a stroke, and the company was accused of not providing medical assistance.</p> <p><strong>Bottom line.</strong> These legal battles are far from over, as courts have not ruled on similar cases in a consistent way. In December, delivery app Loggi was forced to <a href="https://brazilian.report/business/2019/12/19/brazil-moves-regulate-gig-economy-worse-workers/">register all of the couriers</a> that use the application as its employees.</p> <p><strong>Halfway.</strong> For Victor Pagani, an executive at the Inter-union Department of Socio-economic Studies (Dieese), the discussion goes beyond the issue of employment relationships. &#8220;We must ensure these app workers some protection. They have no kind of insurance for accidents and have no cap on working hours per day.&#8221;</p> <p><strong>Is the gig economy the new economy?</strong> iFood celebrated the verdict, saying that &#8220;courts understand that in the new economy, different job opportunities appear, and it is up to workers to choose how and when to work.&#8221;</p> <hr class="wp-block-separator"/> <h2>Brazil&#8217;s disaster prevention budget lowest in 11 years</h2> <p>Since 2012, the federal government has dramatically reduced its budget for natural disaster prevention. Last year, the Jair Bolsonaro administration used less than one-third of what had been pledged. When asked about the matter, the government blames state- and municipal-level administrations for not executing projects, as &#8220;the release of funds occurs according to the progress of works.&#8221;</p> <div class="flourish-embed" data-src="visualisation/1298893"></div><script src="https://public.flourish.studio/resources/embed.js"></script> <p><strong>On the budget.</strong> The money was supposed to be used for preventing floods, mitigating landslide risks in neighborhoods located in precarious areas, as well as rainwater management initiatives.&nbsp;</p> <p><strong>Why it matters.</strong> Due to climate change issues, many Brazilian regions are suffering from more extreme climate conditions—such as massive rainfall or harsh droughts. According to the National Center for Monitoring Natural Disasters (Cemaden), 2020 is the year with the biggest number of incidents related to intense rainfall since 2011—when the center was created.</p> <p>More than ever, natural disaster prevention must be seen as an important issue.</p> <figure class="wp-block-embed-youtube wp-block-embed is-type-video is-provider-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio"><div class="wp-block-embed__wrapper"> <span class="embed-youtube" style="text-align:center; display: block;"><iframe class='youtube-player' type='text/html' width='1200' height='675' src='https://www.youtube.com/embed/TFYbPhuVgoQ?version=3&#038;rel=1&#038;fs=1&#038;autohide=2&#038;showsearch=0&#038;showinfo=1&#038;iv_load_policy=1&#038;wmode=transparent' allowfullscreen='true' style='border:0;'></iframe></span> </div></figure> <p><strong>Recurring. </strong>Disasters related to intense rainfall (floods and landslides) are becoming as typical of Brazilian summers as Carnival. This year, seven states have faced problems related to rainfall. In Minas Gerais, 52 were killed and 35,000 were displaced in torrential storms.</p> <p><strong>Not enough.</strong> For 2020, the budget for natural disaster prevention is BRL 284 million, just 7 percent of what it was in 2012.&nbsp;</p> <hr class="wp-block-separator"/> <h2>Most emblematic slave labor case will finally go to trial</h2> <p>A federal court in the state of Pará has accepted charges against two farmers accused of submitting 85 people to slave labor in the now-infamous Brasil Verde Farm, which belonged to one of Brazil&#8217;s biggest cattle-ranching groups. These workers were rescued in March 2000, after two of them fled the farm.</p> <p><strong>Why it matters.</strong> The case is a textbook example of how impunity allows employers to exploit their labor force. Since 1995, over 52,000 workers have been rescued from slave-like conditions. But until 2016, not one employer was put behind bars.</p> <p><strong>History.</strong> This case had many crazy twists and turns. It even disappeared for some time after being transferred from one court to another.</p> <p><strong>Human rights. </strong>The case turned Brazil into the first nation to be convicted for slave labor by the Interamerican Court of Human Rights. The country was sentenced to pay USD 5 million dollars as compensation to 128 workers who were kept for years—and in a few cases, decades—as modern slaves.</p> <p><strong>Problems.</strong> Anti-modern slavery mechanisms have been rolled back in recent years, with inspectors having fewer funds and structure to monitor companies. Even so, the number of workers found in these conditions tripled in 2018.</p> <p><strong>Documentary. </strong>We at <strong>The Brazilian Report</strong> were involved in the production of the documentary “Precisão,” by the International Labor Organization and Brazil&#8217;s Labor Prosecution Office. The film shows the desperate conditions of people forced into modern slavery around Brazil, where workers are, in many cases, “treated worse than cattle.” <a href="https://brazilian.report/society/2019/11/28/precisao-documentary-face-modern-slavery-brazil/">Watch here</a>.</p> <hr class="wp-block-separator"/> <h2>What else you need to know today</h2> <p><strong>Meat.</strong> After three years of negotiations, Brazil&#8217;s meat behemoth JBS signed a deal with China&#8217;s WH Group to export BRL 3 billion of beef per year. The first shipments are scheduled for March. The WH Group is the world&#8217;s biggest pork producer and has 60,000 points of sale in the Asian country.</p> <p><strong>Firings 1.</strong> President Jair Bolsonaro fired the head of the National Social Security Institute (INSS) after a months-long crisis that has delayed payments of benefits to millions of people—and created an image problem for the government. The INSS has struggled to process an intense number of retirement requests. These cases spiked in 2018, according to official data, as many workers scrambled to retire <em>before</em> last year&#8217;s <a href="https://brazilian.report/newsletters/daily-briefing/2019/08/07/brazil-pension-reform-antitrust-press-corporate-earnings/">pension reform</a> was approved, leaving a backlog of 2 million requests.</p> <p><strong>Firings 2.</strong> Deputy Chief of Staff Vicente Santini was fired after flying to the World Economic Forum, in Switzerland, and on to India, aboard an Air Force aircraft—while cabinet members took chartered flights. While not illegal, such flights are very expensive and it didn&#8217;t bode well with Jair Bolsonaro&#8217;s supporters.</p> <p><strong>Chess.</strong> Once known for being averse to interviews, Justice Minister Sergio Moro has appeared on many talk-shows recently—carefully hinting (without ever being explicit) that a presidential candidacy is not off the table. On Tuesday, he paid a visit to Rio de Janeiro federal judge Marcelo Bretas—arguably the <a href="https://brazilian.report/podcast/2019/03/27/brazil-operation-car-wash-bretas/">new face of Operation Car Wash</a>. Mr. Moro is seeking to reinforce his ties to the criminal investigation, which remains popular. He also had a dig at his boss, inviting Federal Police Chief Maurício Valeixo to the meeting, who has been <a href="https://brazilian.report/power/2019/09/08/sergio-moro-bolsonaro-enemy-federal-police/">criticized by President Bolsonaro</a>.</p> <p><strong>Venezuela 1. </strong>The U.S. Agency for International Development (USAID) and the UN International Organization for Migration (IOM) launched a program on Tuesday to help Venezuelan migrants settle in Brazil. Almost 1 million Venezuelans have <a href="https://brazilian.report/society/2018/02/19/venezuelan-women-ochenta-brazil/">crossed the Brazilian border</a> in recent years, fleeing their country&#8217;s socio-economic collapse. Official data says that an average of 500 cross into Brazil from Venezuela each day. While most move on to Spanish-speaking countries, some 264,000 have applied to stay permanently in Brazil. The USAID will give USD 4 million to help relocate migrants from the poor northern state of Roraima, which is their entry point to Brazil.</p> <p><strong>Venezuela 2. </strong>As Venezuela continues its descent into economic chaos, President Nicolás Maduro has considered selling the government&#8217;s <a href="https://www.bloomberg.com/news/articles/2020-01-27/venezuela-weighs-privatizing-oil-as-it-faces-economic-freefall?sref=Bq9vyGd4">majority stake</a> in the state-owned oil company Petróleos de Venezuela (PDVSA) to international groups, according to a <em>Bloomberg</em> report. Mr. Maduro&#8217;s government has reportedly begun talks with oil companies from Russia, Spain, and Italy.

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