Italian DPA fines Glovo-owned Foodinho $ 3 million, orders changes to algorithmic runner management – TechCrunch


Algorithmic management of concert workers put on-demand delivery company Foodinho, owned by Glovo, in trouble in Italy, where the national data protection authority imposed a fine of 2.6 million euros (~ $ 3 million) yesterday after an investigation found a long list of problems.

The delivery company was ordered to make a number of changes to its mode of operation in the market, the Garante’s order giving it two months to correct the most serious violations found, and an additional month (therefore three months). in total) to change the way its algorithms work – to ensure compliance with privacy legislation, the status of Italian workers and recent legislation protecting platform workers.

One of the concerns for the data watchdog is the risk of discrimination arising from a runner scoring system operated by Foodinho – which had some 19,000 runners operating on its platform in Italy at the time of Garante’s investigation.

A long-standing dispute by runners showing up for another food delivery brand in Italy, Foodora, which resulted in a ruling by the country’s Supreme Court is likely relevant. Last year that claimed runners should be treated as having worker rights, whether employed or self-employed, which strengthens arguments against delivery apps that apply algorithms to opaque micromanage the work of platform workers .

In the injunction against Foodinho, the Italian DPA said it found numerous breaches of EU privacy law, including the principles of transparency, notification, lawfulness of processing, security, privacy by design of GDPR, etc. [an English extract of the injunction has now been published here] – as well as a risk of discrimination against concert workers based on how Foodinho’s booking and allocation algorithms work, in addition to raising concerns about how the system uses ratings and reputation as additional levers of labor control.

Article 22 of the European Union’s General Data Protection Regulation (GDPR) protects individuals from being only subject to automated decision-making, including profiling, when such decisions have an effect. legal or similar substantial effect (and access to paid work would meet that bar) – giving them the right to obtain information about and object to a specific decision and / or request a human review.

But it doesn’t appear that Foodinho has granted such rights to runners, according to Garante’s assessment.

In one Press release about the injunction (which we translated from Italian with Google Translate) the watchdog writes:

“The Authority noted a series of serious infringements, in particular with regard to the algorithms used for the management of workers. The company, for example, had not sufficiently informed workers about the operation of the system and failed to guarantee the accuracy and correctness of the results of the algorithmic systems used for the evaluation of runners. It also did not guarantee procedures to protect the right to obtain human intervention, to express one’s opinion and to challenge the decisions adopted by the use of the algorithms in question, including the exclusion of a part of the riders. employment opportunities.

“The Guarantor therefore asked the company to identify measures to protect the rights and freedoms of runners in the face of automated decisions, including profiling.

The watchdog also says he asked Foodinho to check the “correctness and relevance” of the data that feeds into the algorithmic management system – listing a wide variety of signals taken into account (such as cats, e -mails and phone calls between runners and customer service; geolocation data captured every 15 seconds and displayed on the application map; estimated and actual delivery times; detail of the management of the current order and of those already made; customer and partner returns; remaining battery level of the device, etc.).

“It is also in order to minimize the risks of errors and distortions which could, for example, lead to the limitation of the deliveries allocated to each runner or to the exclusion himself from the platform. These risks also arise from the rating system, ”he continues, adding:“ The company will also need to identify measures that prevent the inappropriate or discriminatory use of reputation mechanisms based on feedback from customers and business partners. “

Glovo, Foodinho’s parent entity – which is named the platform owner in Garante’s injunction – has been contacted for comment on the injunction.

A company spokesperson told us he was discussing a response. So we’ll update this report if we get one.

Glovo acquired Italian food delivery company Foodinho in 2016, making its first foray into international expansion. The Barcelona-based company then tried to start a business in the Middle East and Latin America – before falling back to focus primarily on Southern and Eastern Europe. (In 2018 Glovo also took over the Foodora brand in Italy, which was owned by German rival Delivery Hero.)

Garante says he worked with Spain’s privacy watchdog, AEDP – which is Glovo’s primary data protection supervisor under GDPR – on the Foodinho and platform technology investigation. form provided to it by Glovo.

His press release also notes that Glovo is the subject of an “independent procedure” led by the AEPD, to which he says he is helping.

The Spanish watchdog confirmed to TechCrunch that the joint work between AEPD and Garante resulted in the resolution against Glovo-owned company Foodinho.

The AEPD also said it had initiated its own proceedings against Glovo, stressing a sanction 2019 linked to the latter not appointing a data protection officer, as required by the GDPR. The watchdog then fined Glovo € 25,000 for this failure to comply.

However, it is not clear why the AEDP has – apparently – not examined Glovo’s own compliance with Article 22 of the GDPR in depth. (We’ve asked her more about this and will update if we get a response.)

This told us recently published guidelines on data protection and labor relations, on which she worked with the Spanish Ministry of Labor and employers ‘and trade unions’ organizations, and which, according to her, includes information on the right of a works council to be informed by a platform company of the parameters on which the algorithms or artificial intelligence systems are based – including “the development of profiles, which may affect the conditions, access and maintenance of employment “.

Earlier this year, the Spanish government agreed to a labor reform aimed at expanding the protections offered to platform workers by recognizing platform couriers as employees.

Amendments to Spain’s law on the status of workers were approved by royal decree in May – but are not expected to start being implemented until the middle of next month, per El Pais.

Notably, the reform also contains a provision that requires workers’ legal representatives to be informed of the criteria feeding any algorithms or AI systems that are used to manage them and that may affect their working conditions – such as those affecting access to employment or rating systems. who monitor the performance or profile of workers. And this additional provision of inbound algorithmic transparency has obviously been taken into account in the guidelines of the AEPD.

So the watchdog may grant affected platforms like Glovo a grace of a few months to allow them to get their systems in order for the new rules.

Of course, Spanish labor law also remains distinct from Italian law, so there will be permanent application differences related to the elements that concern delivery applications, regardless of what appears to be a similar trajectory on the issue of extension of the rights of platform workers.

In January, for example, an Italian court found that a reputation ranking algorithm that had been used by another on-demand delivery app, Deliveroo, discriminated against passengers because it failed to distinguish between between legally protected grounds for retaining work (e.g., because a rider was sick; or exercising their protected right to strike) and other reasons for not being as productive as they indicated .

In that case, Deliveroo said the judgment referred to a historic reservation system which it said was no longer used in Italy or any other market.

More recently, a Bologna court ruling found a collective bargaining agreement signed by AssoDelivery, a trade association that represents a number of delivery platforms in the market (including Deliveroo and Glovo), and a minority union with far-right affiliations, UGL trade union trade, to be illegal.

Deliveroo told us they plan to appeal the decision.

The agreement has sparked controversy as it seeks to derogate unfavorably from Italian law that protects workers and the signatory professional body is not sufficiently representative in the sector.

Zooming out, EU lawmakers are also addressing the issue of platform workers’ rights – launching a consultation in February on how to improve working conditions for concert workers, with the possibility that Brussels is proposing legislation later this year.

However, the platform giants saw the exercise as an opportunity to push for deregulation – pushing to lower employment standards for gig workers across the EU. The strategy appears intended to bypass or at least try to limit the momentum for strengthened rules at the national level, such as the labor reform in Spain.

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