Spain fined Glovo 79 million euros in 2022 for failing to contribute to social security and make other payments from 2018 to 2021 as it did not hire its delivery riders under formal contracts. Get the latest news and expert analysis about the state of the global economy with the Reuters Econ World newsletter. Sign up here.

Glovo, a Spanish delivery app owned by Germany's Delivery Hero, has bowed to pressure over labor rights in its home market. The company announced Monday

App-based food delivery firm Glovo's freelance riders in Spain will be hired as employees following pressure from the government to give them labour contracts, its German owners Delivery Hero said Monday.

Shares of Delivery Hero SE tumbled sharply on Monday after the German company said it would shift to an employment-based model for its freelance delivery riders in Spain.

Spain had fined Glovo in 2022 and 2023 for violating labor laws. At the time, Spain's labor ministry said the company was being punished for not contracting its drivers as employees and for giving gigs to immigrants who lacked proper documentation and work permits.

Glovo, the Spanish subsidiary of the German food delivery service Delivery Hero, is to offer its riders permanent contracts to avoid possible legal uncertainties. The step, taken in response to accusations from Spain's labour authorities,

The move follows a lack of final agreement on the classification of delivery riders under Glovo's operational model.