Seoul City Conducts Joint Inspection of Unfair Contracts in Delivery Agencies... Corrects Unfair Clauses and Adopts Standard Contracts

Joint Inspection of Contracts for 163 Delivery Agency Companies in Seoul and Gyeonggi
111 Companies Adopted 'Standard Contract', 13 Companies Agreed to Voluntary Correction of Unfair Clauses in Contracts

Current Transaction Structure of the Delivery Agency Industry

[Asia Economy Reporter Lim Cheol-young] On the 22nd, Seoul City announced that it has completed an inspection of the contract practices between delivery agencies and delivery drivers for 163 "local delivery agencies" registered in the Seoul and Gyeonggi areas with 50 or more delivery drivers from April to July, in collaboration with the Fair Trade Commission, Ministry of Land, Infrastructure and Transport, Gyeonggi Province, and Korea Fair Trade Mediation Agency.

According to the inspection results, excluding 22 companies that have closed or have unknown addresses, 124 out of a total of 141 companies agreed to revise unfair clauses included in their contracts or adopt the standard contract. Approximately 12,000 delivery drivers will have their rights protected through this contract inspection.

The contract inspection revealed several issues such as omission of delivery fees, unilateral changes to commission fees, unreasonable liability provisions, imposition of non-compete obligations after contract termination, blocking delivery drivers’ multi-homing (contracting with multiple companies), and unilateral contract termination. The inspection was conducted targeting "local delivery agencies" in cooperation with three "separated-type delivery apps": LogiAll, Barogo, and Mesh Korea. Seoul City and Gyeonggi Province collected contracts from local delivery agencies for a first review, and the Fair Trade Commission conducted the final check for the inclusion of unfair clauses.

The "standard contract" was prepared in October last year through discussions led by the private sector including the delivery industry and labor groups, supported by relevant government ministries, and includes provisions to protect delivery drivers’ rights such as prohibition of unfair trade practices, prohibition of discrimination, and subscription to industrial accident insurance.

Following this inspection, 31 companies in Seoul and 80 companies in Gyeonggi where unfair clauses were found agreed to adopt the "standard contract," and 13 companies in Seoul decided to amend the unfair clauses in their current contracts.

Seoul City has urged 17 companies that refused both adoption of the standard contract and voluntary correction to be cautious to prevent unfair trade practices against delivery drivers in the future, and plans to conduct more thorough investigations if reports against these companies are received.

Seoul City, Gyeonggi Province, and related agencies plan to continue management and supervision to protect delivery drivers’ rights based on the inspection results. They will also continuously verify whether companies adopt the standard contract and correct unfair clauses as planned.

The Ministry of Land, Infrastructure and Transport also plans to include the use of the standard contract as a certification criterion when implementing the certification system for small parcel delivery agencies to promote the spread of the standard contract.

Han Young-hee, Seoul City’s Director of Labor, Fairness, and Coexistence Policy, said, “The first step to protecting the rights of the increasing number of delivery drivers starts with fair contracts,” and added, “We will strengthen cooperation not only with the government and local governments but also with delivery agencies to ensure delivery drivers can work in a fair environment.”

This content was produced with the assistance of AI translation services.