By Linda Liang, Yang Chunhui King & Wood Mallesons’ Commercial & Regulatory group

If couriers have any traffic accident when delivering services, the compensation liability may sometimes be borne by the takeout platform, or sometimes by couriers themselves, or even by an unknown third party. In principle, there should be rules to govern the apportion of the compensation liability, for according to the basic principles of Tort Law, when a worker in “working relationship” (including labor relationship, service relationship，employment relationship and labor dispatch relationship) causes damage to others during delivery of work, the party assigning the work ( “employer”) shall bear the tort liability. However, now the relationship between couriers and takeout platforms is so complex that the question who should bear the liability also becomes complex.

Couriers hired by platforms may face considerable risk

1.Couriers hired by platforms—takeout platform s’ “own children” 

This kind of couriers are employed and managed by takeout platforms. Couriers are employees of the takeout platforms and takeout platforms are employers of couriers. Usually, takeout platforms assume the liability of infringement compensation of couriers because of the working relationship between them. Despite the advantage of management efficiency, such couriers may also bring high employment risks to their platforms. In order to control employment risks, platforms need to strengthen safety administration over couriers and purchase commercial insurances for them. “Meituan” once laid off a good number of such couriers partly with an aim to control employment risks.

2. Avoid becoming a scapegoat 

It should be noted that whether there exists working relationship between couriers and platforms is always controversial. Takeout platforms should take the burden of proof with regard to whether a courier is an employee; otherwise a courier might be regarded as having working relationship with the platform, and accordingly the takeout platform would bear the employer’s liability. For example, in Shen Qingxia v. Shanghai Lazhasi technology co. LTD (“Eleme” takeout platform), a tort liability dispute ([2017] Zhe 01 minzhong No. 4425), Eleme contended but failed to fully prove that couriers can be outsourced or crowdsourced and the courier in the present case is not its employee. Considering the conduct of the takeout platform, such as purchasing couriers delivery vehicle, assigning work orders and conducting staff managing, the court decided that the courier is an employee. Accordingly, the court ruled that the takeout platform shall bear the tort liability for its employee.

Outsourced couriers are popular

1. Outsourced couriers—“children of friends” 

Outsourcing means transferring the ongoing management of a service to a third party according to a service agreement. The takeout platform outsources the delivery service to a third party by executing a cooperation agreement. The couriers offering delivery services pursuant to the order of the third party are outsourced couriers. Since the outsourced couriers are employed and managed by the third party, there is working relationship between them. Thus, the accident liability shall be borne by the third party instead of the takeout platform.

2. Typical case 

In Liu Xiangtan v. Beijing Sankuai online technology co. LTD (“Meituan” takeout platform) and Tianjin Yijintang Catering Management co. LTD for motor vehicle accident disputes ([2017]Jin 0103 minchu No. 585), Meituan’s courier had a traffic accident in the delivering process. Liu Xiangtan, the victim, requested that Meituan assumes the compensatory liability, but was rejected by the court. The court held that Meituan and the franchisee have signed the “Meituan takeout delivery service agreement”, and delivery within a specific area has been referred to the franchisee. The courier was employed by the franchisee, so the franchisee defendant shall bear the compensatory liability when  the courier causes damages while providing employment services. Although Sankuai Co. Ltd. operates Meituan.com, no employment relationship exists between the company and the direct infringer. Therefore, the claim of the plaintiff was not well grouded and was not supported by the court.

3. Special circumstances 

It is worth noting that, if outsourced couriers work privately out of working hours and cause accidents and damage, the franchisee can be exempted from liability. However, if the franchisee does have fault on the accident (e.g. equipping couriers without driving license with motor vehicles), the corresponding fault liability may still be borne by the franchisee.

Crowdsourced couriers, the new trend

1. Crowdsourced couriers – the favorite of new era 

Crowdsourcing refers to a case where the working tasks that used to be performed by employees are outsourced to large numbers of unspecified general public, in a free and voluntary way. Anyone among the crowd providing delivery service for takeout platforms is a crowdsourced courier. Crowdsourced couriers are neither employees of takeout platforms nor outsourced service providers, but self-employed. Once the registration is completed, a crowdsourced courier is free to choose delivery orders. Crowdsourced couriers have greatly expanded the service scope of takeout platforms, and reduced their management responsibility and risks. Crowdsourced couriers have great advantages over outsourced couriers and those hired by platforms.

2. Typical case 

Because there is no working relationship between crowdsourced couriers and takeout platforms, most courts hold that takeout platforms need not bear the liability for damage caused by crowdsourced couriers. In Liu Heping v. Shanghai Qusheng Network Technology co. LTD and Dajiang Network Technology (Shanghai) co. LTD (“Dada” delivery platform) etc. with regard to right of life, right of health and right of body ([2016] Hu 0115 minchu No. 81742), the court held that, it is the main function of Dada delivery platform to provide registered users (i.e. crowdsourced couriers) with the delivery demand of merchants. Couriers receive the demand for delivery from merchants through the platform and choose whether to provide delivery service according to their own will. Therefore, Dada delivery platform just provides intermediary services. It reports information to its registered couriers but does not manage them. Dada has no restriction on whether couriers provide delivery services or not, and does not charge any fees from couriers’ delivery services, so no labor relationship exists between Dada and couriers. Moreover, the objects of courier’s delivery service are merchants rather than the delivery platform, so there is no relationship of completion of a specific task between delivery platform and couriers. Thus, the plaintiff’s claim that the delivery platform bears the liability lacks factual and legal basis. The court did not support the claim.

Conclusion

To sum up, regardless of the type of couriers, which party shall bear the liability for damage caused in their work should be based on the legal relationship between couriers and the parties. If working relationship exists, then the liability should be taken by the takeout platform or the franchisee; if it does not exist, the liability is usually borne by couriers themselves. If there is no working relationship between the takeout platform and the courier, the platform still need to maintain clarity and prepare evidence to confront a victim’s claim of liability for damage; otherwise blame for others may be shifted to it.