Wolt Couriers to Receive $9.5 Million Settlement, Remain Independent Contractors
Translated & summarized from Globes by baba
Wolt and its Israeli couriers have reached a settlement in a class-action lawsuit, with the company agreeing to pay approximately $9.5 million. The couriers will not be recognized as employees but will receive enhanced benefits and protections.
The story in 5 lines · by baba
- Wolt couriers receive $9.5 million settlement in class-action lawsuit.
- Couriers remain independent contractors, not recognized as employees.
- Settlement guarantees minimum wage and provides insurance coverage.
- Wolt couriers will receive safety training and right to hearing.
- Agreement preserves Wolt's independent contractor model.
After more than 26 mediation sessions, a settlement agreement has been filed with the National Labor Court in Jerusalem between the food delivery company Wolt and its couriers. The class-action lawsuit had sought to recognize the couriers as employees of the company, entitling them to associated social benefits. The agreement stipulates that Wolt will provide a one-time payment totaling NIS 34.3 million (approximately $9.5 million) to the group members.
The settlement aims to preserve the existing independent contractor model between Wolt and its couriers. Under specific conditions outlined in the agreement, the parties have agreed that employment relationships will not be established. However, the deal addresses issues raised in the lawsuit by implementing protections not typically afforded to independent contractors and offering significant financial benefits.
Effective upon the court's approval and the settlement's enactment as a judgment, couriers will receive a guaranteed minimum wage equivalent to the national minimum wage. They will also benefit from an incentive bonus encouraging contributions to self-employed savings plans, Wolt-funded insurance coverage, safety training, the right to a hearing before termination of engagement, and adherence to group equality norms in various laws.
The original lawsuit, filed by attorneys Amit Ido and Yaakov Spiegelman, alleged that Wolt exploited power imbalances by having couriers sign a "uniform and exploitative" agreement that classified them as independent contractors, thereby denying them employee status and associated social rights. The settlement explicitly states that neither party admits to the claims, and the resolution does not establish findings regarding the disputed issues of alleged employment relationships.
The mediation process involved former Supreme Court Justice Yoram Danziger and former Judge Michael Spitzer. Wolt reportedly employs around 20,000 couriers in Israel. The settlement includes a differential compensation model rewarding couriers based on the number of deliveries, with more active and senior couriers receiving higher compensation.
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