A groundbreaking agreement has been reached between the Transport Workers Union (TWU) and two of Australia’s major food delivery platforms, Uber Eats and DoorDash, promising to significantly enhance pay rates for those working in the gig economy.

This historic pact establishes a set of minimum standards for delivery drivers and riders, a first for the industry. Included in the agreement are provisions for a minimum “safety net pay” rate, mechanisms for resolving disputes, accident insurance, and the right to legal representation.

The implementation of this deal would provide delivery workers with much-needed wage stability. Traditionally, these workers have been compensated below Australia’s minimum wage, as they are paid per delivery rather than by the hour.

One of the most impactful aspects of this agreement is the anticipated 25 percent pay increase for those working with Uber Eats and DoorDash, marking a substantial improvement in their earnings.

Set to come into effect in July of next year, this arrangement, if approved, could redefine the landscape of the gig economy, offering better financial security and working conditions for the countless individuals who rely on these jobs.

If approved, the new standards would come into effect from July next year.

It follows several years of union campaigning and negotiations between TWU and the two delivery services.

“Gig workers have campaigned for years for a better industry and for the first time in the world, there could soon be a minimum floor that represents a life-changing increase to their pay,” said TWU National Secretary Michale Kaine.

“After constructive discussions with Uber Eats and DoorDash, this is a significant step towards a fairer gig economy.

“We look forward to the Fair Work Commission considering these new standards and working towards a strong foundation for fairness in the gig economy.”

Both Uber Eats and DoorDash supported the proposal.

DoorDash APAC Vice President Simon Rossi said it is important that working standards in the on-demand economy continue to “evolve”.

“Delivery workers keep Australia moving, helping busy households and supporting small businesses,” Rossi said.

“This proposal shows we can work together to lift standards and still enable the flexibility people rely on, under the Government’s new laws.”

Uber Eats Australia and New Zealand Managing Director Ed Kitchen added that the service supports “sensible and modern reforms”.

“We believe fair standards and flexibility should not be mutually exclusive,” Kitchen said.

“They are both essential to ensuring gig work continues to meet the expectations of Australians and reflects the important role delivery people play in their communities.”

Menulog, Foodora and Deliveroo have all pulled out of the local market in recent years, citing tough trading conditions.