Deliveroo workers strike in pay and conditions dispute as company shares start to rise

Deliveroo shares have climbed higher on their first day of full trading - despite coinciding with the start of a rider strike over workers' rights.

The takeaway delivery operator saw shares increase by more than 3% to 290p in early trading on Wednesday, before edging back slightly.

Last Wednesday, shares in Deliveroo plunged by around 30% as large fund managers raised concerns over working conditions for riders and its shareholder structure.

But the company is maintaining that most of its drivers are satisfied working for the company, despite "hundreds" taking action on Wednesday.

The start of retail trading came as socially distanced protests were held by riders in cities including London, York, Sheffield, Reading and Wolverhampton.

Wednesday is the first day retail investors have been able to trade shares in the business - institutional investors have been able to trade in the stock since conditional trading started a week ago.

The Independent Workers’ Union of Great Britain (IWGB) said hundreds of its members went on strike as part of a campaign for more pay and improved employment rights and safety protections.

The company disputed the union’s claims, saying only a “tiny minority” of workers took action, adding it was launching a consultation with riders about how to invest a new £50 million community fund.

What are Deliveroo riders striking about?

The industrial action follows recent campaigns by those in the gig economy to be classed as workers and so receive better pay and conditions.

Unions won legal action recently against ride hailing firm Uber.

Deliveroo riders as they go on strike in a dispute for fair pay, safety protections and basic workers' rights. Credit: PA

Scores of riders joined a protest in London, including Jake Thomas, 21, who has worked for Deliveroo for three years.

He said: “It’s got to the point where it’s not financially viable, we can’t make minimum wage, we can’t make ends meet.

“We’re not getting the support we need, we’re not getting the pay we need so we’re coming out to show investors and the public what is actually going on under the surface.”

Another driver, Ian, 29, said: “I’m just protesting for basic rights, better working conditions, safer working conditions.

“The over-hiring of staff has affected things drastically – there’s less jobs for us full-time employees.

“The pay has dropped, we don’t get paid for waiting, and we also have to pay expenses, so it all adds up.”

Deliveroo said it surveyed 8,500 riders on Tuesday and 89% said they were satisfied working for the company.

When asked what are the most important factors when working with Deliveroo, the top answer was ‘Working when I like’, followed by ‘Working where I like’ and ‘The ability to choose which orders I accept’, said Deliveroo.

Deliveroo drivers cycled through London on a day of strike action. Credit: PA

‘How much money I make’ was number five, said a spokeswoman.

She added: “This small self-appointed union does not represent the vast majority of riders who tell us they value the total flexibility they enjoy while working with Deliveroo alongside the ability to earn over £13 an hour.

“Only yesterday we ran a survey and 89% of riders said that they were happy with the company and flexibility was their priority.

“We are proud that rider satisfaction is at an all-time high and that thousands of people are applying to be Deliveroo riders each and every week.

“Riders are at the heart of our business and today we are beginning a new consultation with riders about how we should invest our new £50 million community fund.”

Credit: PA

Shares moved higher despite the strike, as the 70,000 retail investors who took part in its London float decided to hold on to their stock.

But shares are still around 28% below their launch price of 390p per share, which would have valued the business at £7.6 billion.

As of midday on Wednesday, the company had a market value of around £5.3 billion.

Despite concerns over rider conditions, leading fund managers largely said that the primary cause of their caution over the stock market float was its shareholder structure, which will give significant power to its founder Will Shu in shareholder votes.