Uber Eats agrees to amend unfair refund policy

Restaurants will now have more control over refunds for orders placed via Uber Eats, following an investigation by the Australian Consumer and Competition Commission (ACCC).

Uber Eats’ contract terms previously gave it the right to refund customers and deduct that amount from the restaurant, even when the problem with the meal may not have been the fault of the restaurant.

Now, the meal delivery service has agreed to change its contract terms to clarify that restaurants will only be charged for refunds related to matters within their control, such as incorrect food items or missing orders.

Restaurants will also be able to dispute responsibility for any refunds to customers, and Uber Eats will reasonably consider these disputes, the consumer watchdog said in a statement.

Uber Eats will begin rolling out changes to its contracts shortly and says all will be completed by December 2019. The company has committed not to enforce the terms that the ACCC considers to be unfair while these changes are completed.

“We will continue to monitor Uber Eats’ conduct to ensure restaurants are not unfairly held responsible for matters outside of their control and Uber Eats does not hold anyone else responsible for parts of the service it controls,” Rod Sims, ACCC chair, said.

Call for change

While it is not currently illegal under the Australian Consumer Law for large businesses to include or rely on unfair contract terms against a smaller business, and penalties cannot be imposed for such conduct, the ACCC is calling for legislative changes so it can seek penalties and compensation for small businesses that face unfair contract terms from larger businesses.

“Business are warned that if they include unfair contract terms in their contracts, they will risk close scrutiny from the ACCC,” Sims said.

Uber Eats, which launched in Australia in 2016, told the Australian Financial Review that it had 16,500 restaurants, cafes and food outlets on its platform in Australia and New Zealand in October 2018, making it the dominant player in the growing meal delivery market – over Deliveroo and Menulog.

The AFR report said the platform charges a service fee of roughly 35 per cent to transport meals from restaurants to customers’ doorsteps.

In addition to standalone restaurants and food outlets, platforms like Uber Eats, Deliveroo and Menulog are increasingly partnering with national food chains, such as McDonald’s, Guzman y Gomez and Red Rooster.

Yes to logistics

In addition to amending its contract terms around refunds, Uber Eats has also agreed to remove a statement in its contracts that said it does not provide logistics services.

The ACCC says it was concerned by this clause given Uber Eats’ role in determining the pool of drivers available to restaurants, their payments, and providing facilities such as the consumer’s address, map services and GPS tracking to assist the driver in delivering meals.

“We welcome Uber Eats agreeing to remove the statement in its contracts saying it does not provide logistics services, because clearly, in our view they do,” Sims said.

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