Australia’s workplace tribunal has ordered food delivery platforms to pay drivers a minimum of AU$31.30 an hour, a decision hailed as the world’s first binding wage floor for gig economy couriers. The Fair Work Commission handed down the ruling this week, capping a years-long push by unions to extend basic labor protections to drivers working for apps such as Uber Eats, DoorDash and Menulog.
The decision applies to so-called “employee-like” workers — gig drivers who are not formally classified as employees but who the Commission determined deserve baseline pay and safety standards. It marks the first time any country has set a legally enforceable minimum hourly rate specifically for app-based delivery work.
How the Ruling Works
Under the new standard, delivery riders and drivers must be guaranteed at least $31.30 per hour while engaged on a job, a rate roughly in line with Australia’s national minimum wage plus loadings that account for the lack of traditional employee entitlements such as paid leave and superannuation. The figure was calculated using Australian Bureau of Statistics benchmarks and submissions from unions, platforms and the government.
The order stems from Australia’s Closing Loopholes industrial relations laws, passed in 2024, which gave the Fair Work Commission authority to set minimum standards for gig and platform workers for the first time. Unions, led by the Transport Workers’ Union, had spent years documenting cases of delivery riders earning well below minimum wage once fuel, vehicle costs and unpaid waiting time were factored in.
“This is a historic day for the hundreds of thousands of Australians who deliver our food and packages,” a Transport Workers’ Union spokesperson said, calling the ruling proof that gig workers can be protected without stripping away the flexibility that draws many to the work.
Industry Response
Delivery platforms operating in Australia had opposed elements of the union’s original wage claim, arguing that a rigid hourly floor sits awkwardly with a business model built around workers logging on and off at will. Companies including Uber, DoorDash and Menulog’s parent Delivery Hero warned during hearings that higher labor costs could be passed on to customers through higher delivery fees, or absorbed by reducing the number of active driver accounts on their platforms.
Platforms will now need to adjust their pay algorithms to guarantee the new floor is met per engaged hour, rather than per delivery, which has been the industry’s traditional pay structure. Some companies have signaled they may introduce minimum per-order guarantees or restructure surge pricing to offset the change. Full compliance details, including how “engaged time” will be tracked and audited, are expected to be finalized by regulators in the coming months.
A Global Test Case
Australia’s move is being closely watched by labor regulators overseas, where courts and lawmakers have taken sharply different approaches to classifying gig workers. The United Kingdom’s Supreme Court ruled in 2021 that Uber drivers should be treated as workers entitled to minimum wage, while the European Union has pushed a directive presuming platform workers are employees unless companies can prove otherwise. In the United States, gig worker classification remains a patchwork of state-level fights, with California voters largely upholding contractor status for app-based drivers in a 2020 ballot measure.
Australia’s approach differs from both models by creating an entirely new category — “employee-like” workers — who retain their independent contractor status but still receive baseline protections such as minimum pay, superannuation contributions and the ability to be represented by a union in disputes with platforms. Supporters argue this threads the needle between full employment and unregulated gig work, while critics on both sides say it risks satisfying neither drivers seeking full employee rights nor platforms seeking regulatory certainty.
What Comes Next
The Fair Work Commission’s order takes effect on a rolling basis as platforms update their payment systems, with enforcement mechanisms still being worked out between regulators and the companies. Unions have indicated they intend to seek similar minimum standards for other categories of gig work, including rideshare driving and courier services beyond food delivery.
For now, the ruling gives Australia’s roughly 250,000 gig delivery workers a wage floor that did not exist a week ago — a shift that labor economists say could reshape how other governments think about regulating platform work as the sector continues to expand. Whether the model proves durable, or whether platforms find ways to route around it, is likely to shape delivery pricing and driver earnings across the country well into 2027.
