Imagine a complex electrical circuit board with numerous wires connecting multiple nodes. In the context of the gig economy, picture these nodes as gig workers and the wires as the algorithmic management systems directing their jobs. This intricate network, however, is prone to disruptions when these ‘wires’ get crossed, as exemplified by the Deliveroo case in Italy, which resulted in a €2.5 million fine. This case serves as a stark reminder of the consequences of mishandling data and violating regulations in the gig economy.

The Deliveroo case: A violation of data protection law

The Italian Data Protection Authority, Garante per la protezione dei dati personali (“Garante”), imposed a €2.5 million fine on Deliveroo Italy s.r.l. on 2 August 2021. This punitive action followed an investigation into Deliveroo’s practices, which found the company guilty of unlawfully processing the personal data of approximately 8,000 riders and multiple infringements of the EU General Data Protection Regulation (GDPR).

Deliveroo’s primary violations included a lack of transparency about the algorithm managing the riders’ work shifts and the disproportionate collection of riders’ personal data. This violated GDPR principles of lawfulness, transparency, data minimisation, and storage limitation. The company was also found guilty of defining an inappropriate storage period for the collected personal data and implementing insufficient security measures.

The opaque algorithms used to manage the drivers were like the backside of a circuit board — complex and non-transparent. These systems unfairly evaluated drivers’ performance and exerted excessive control, including continuous geolocation tracking. Deliveroo was given 60 days to rectify these violations and an additional 90 days to amend those related to the algorithm.

The repercussions: a hefty fine and legal consequences

The immediate repercussion for Deliveroo was a substantial €2.5 million fine, followed by a court ruling against its discriminatory use of algorithms. The ripple effects of these violations reverberated across the gig economy, drawing parallels to similar instances such as Foodinho’s €2.6 million fine. The case underscored the urgent need for companies to rectify algorithmic issues or risk severe legal consequences.

Broader implications for the gig economy

The Deliveroo case is a cautionary tale for companies that misuse algorithmic management in the gig economy. Much like electricity in a circuit board, these algorithms control the workflow. Their misuse can severely impinge on workers’ rights and privacy.

The Deliveroo and Foodinho cases highlight an emerging trend of increased scrutiny of algorithmic management and its impact on the labour force. As the gig economy evolves, unions play a crucial role in negotiations and addressing algorithmic control.

Actions you can take next

  • Increase your understanding of data protection and workers’ rights by staying updated with emerging legal cases and regulatory changes and joining our mailing list.
  • Advocate for transparency and accountability in algorithmic management within your organisation and your network. We can help with our data protection services.