China enacts legislation to protect food delivery service delivery personnel, food delivery service stock price plummets
In order to protect the basic labor rights of food delivery service delivery personnel, China has established new guidelines that set minimum income, occupational safety, food safety, and an appropriate working environment.
China moves to protect food delivery drivers from digital exploitation, knocking stocks such as services giant Meituan | South China Morning Post
https://www.scmp.com/tech/big-tech/article/3142588/china-moves-protect-food-delivery-drivers-digital-exploitation
Meituan Stock Dives 15% After China Issues Food Platform Curbs --Bloomberg
https://www.bloomberg.com/news/articles/2021-07-26/meituan-dives-15-after-china-issues-food-platform-curbs
On July 26, 2021 local time, seven government agencies, including the Directorate General of National Market Supervision and Administration, a Chinese regulator, published new guidelines to protect the basic labor rights of food delivery service delivery personnel. According to Hong Kong's daily English newspaper South China Morning Post, the guidelines were enacted in response to voices from delivery personnel that 'there are no appropriate worker protection measures for the employment rights of the gig economy.' Delivery staff other than the service are also eligible.
According to the newspaper, the new guidelines set out the following:
-Guarantee delivery personnel with income that exceeds the minimum wage in the area.
-Instead of using the strictest algorithm when evaluating the performance of delivery personnel, use an algorithm that sets a marginal delivery deadline.
・ Allow delivery personnel to take out social insurance and commercial insurance that cover accidents and illnesses.
-Establish a union organization on the platform side and encourage delivery personnel to actively participate so that they can participate in labor rights negotiations.
In addition, authorities are calling for improved safety by deploying delivery personnel rest areas, smart cabinets for food collection, and smart helmets to improve delivery personnel's general working conditions.
In recent years, the working environment of Meituan and Ele.me, which are major food delivery services in China, has been regarded as a problem. A video showing that you can earn only 41 yuan (about 700 yen) by shifting the time is released on SNS. Authorities are investigating the company's long working hours and low wages on suspicion of monopoly practices as a problem with the platform's order allocation mechanism.
Following the enactment of this guideline, Meituan's stock price temporarily fell by 15%, dropping more than 50% from its peak in February 2021.
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