Uber, delivery apps propose offering Mexican drivers social security

MEXICO CITY, Nov 23 (Reuters) – Tech giant Uber (UBER.N) and delivery apps DiDi and Rappi have proposed offering Social Security benefits to workers in Mexico for the first time ahead of a new government law regulating the gig economy pending.

The companies said in a statement Wednesday, co-signed by workers’ rights activist groups, that they were open to covering drivers and couriers who work an average of more than 40 hours a week on one or more platforms.

However, they did not agree to classify drivers as employees and few details were given on the distribution of payments for social security costs.

Mexico’s Labor Minister Luisa Alcalde said officials are working on a bill that would bring gig workers into the “formal economy,” though the timetable is still unclear.

It’s also unclear whether the bill aims to turn drivers into employees or propose other reforms in line with what the apps say.

Ridesharing and delivery apps worldwide have fought back calls to classify workers as employees rather than independent contractors, saying the change would hamper their business models and deny drivers flexibility.

The statement by Uber, Chinese mobility company DiDi Global Inc and Latin American delivery app Rappi also suggested setting up mechanisms to ensure fair pay in line with hours worked, but without outlining details.

“It’s time to take the next step and find consensus… and start improving conditions,” Tonatiuh Anzures, Didi’s director of government affairs in Mexico, said in an interview.

Any changes will depend on further talks and government support, Anzures added.

Nicolas Sanchez, head of public policy at Uber in Mexico, said he hoped the additional costs would be small, but Uber is “open to them” if the industry, which includes around 500,000 people, is allowed to retain flexibility.

The Department of Labor did not immediately respond to a request for comment.

Reaching a broad consensus can be difficult. A few dozen workers on motorcycles honked their horns outside the building in Mexico City where the companies were scheduled to hold news conferences on Wednesday, in what Sergio Guerrero, chairman of the National Union of Application Workers, described as a protest at the companies’ stance.

“To have labor rights, you have to be recognized as a worker,” he said.

Reporting by Isabel Woodford, editing by Daina Beth Solomon, Cynthia Osterman and Anna Driver

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