TKWY Just Eat Takeaway.com N.V.

--Food-delivery companies in Italy face a fine of more than EUR773 million for failing to address shortcomings in working conditions

--Italian operations of Uber Eats, Just Eat, Deliveroo and Glovo are required to change the status of their riders to regular employees from self-employed workers

--Decision from Italian prosecutors comes after probe launched in July 2019

By Giulia Petroni and Mauro Orru

Food-delivery companies, including Uber Technologies Inc.'s Uber Eats and Just Eat Takeaway.com NV, in Italy must hire their drivers under regular labor contracts to comply with health and safety regulations, Italian prosecutors said on Wednesday.

Italian operations of Uber Eats, Just Eat, Deliveroo Inc. and Glovoapp23 SL should change the status of their riders to regular employees from self-employed workers, and pay a total fine of more than 773 million euros ($939.3 million) for failing to address shortcomings in working conditions, according to Milan prosecutors.

Delivery riders currently face continued pressure due to inadequate performance standards and long working hours, while having no holiday or sick pay guaranteed, according to the investigation.

Changing employment status means employers will be responsible for protecting the health and safety of their workers, providing them with adequate training and suitable work equipment, prosecutors said.

"We are fully committed to raising the standard of work and giving independent workers more benefits while preserving the flexibility they value most," a spokesman for Uber said.

"Over the past months, we have put in place a landmark framework for stronger protections and more benefits for independent couriers in Italy, while working hard to set new standards for health and safety protection. We want to be a long-term partner to Italian couriers, restaurants and cities, and we stand ready to address any further concerns," he added.

Deliveroo said it disagreed with the findings of the probe, which it would "contest" via the appropriate forums.

"Deliveroo and other platforms currently operate under an agreement that confirms riders as self-employed while providing them with additional benefits and protections. This decision has no impact on Deliveroo's current activities in Italy," a spokesman for Deliveroo said.

Just Eat and Glovo didn't reply to requests for comment when contacted by Dow Jones Newswires.

Prosecutors launched the probe in July 2019 after a number of traffic accidents involving riders in the city of Milan. They have examined the profiles of more than 60,000 riders working for the Italian food divisions of the four companies.

The developments in Italy come as a setback for gig-economy companies over employment rights.

In a recent ruling, the U.K.'s Supreme Court said a group of former Uber drivers were entitled to a minimum wage and other benefits while working for the company.

Write to Giulia Petroni at giulia.petroni@wsj.com and Mauro Orru at mauro.orru@wsj.com

(END) Dow Jones Newswires

February 24, 2021 13:32 ET (18:32 GMT)

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