‘Not an insignificant ripple’: Thousands of Aussies to lose their job in November

The closure of fast food delivery giant Menulog could result in up to 10,000 Australians out of work, as fears grow the decision will have far-reaching consequences across the service industry.

In a shock announcement on Wednesday, Menulog said it was leaving Australia after nearly 20 years in the industry.

The last day Australians can get take out through the Menulog app will be midnight Wednesday November 26.

Parent company Just Eat Takeaway said it was a “strategic decision”, with approximately 120 workers to lose their jobs.

TWU national secretary Michael Kaine tells NewsWire this figure is “misleading” with closer to 10,000 Australians impacted by the move.

“We think there are in excess 10,000 workers who have accessed work over time through the Menulog app and around 5000 people at any one time,” Mr Kaine said.

“So this is going to affect thousands and thousands of workers as they will now have to find or further supplement income somewhere else, so it’s not an insignificant ripple through the economy.”

Mr Kaine said Menulog closing was a “warning shot” to the industry as it became the latest in a long line of delivery service apps which have closed down in recent years.

What went wrong?

In a statement, Menulog said it was “navigating challenging circumstances” and closing down in the Australian market would allow its parent company Just Eat to focus on “accelerating growth and investments in other markets.”

According to IBIS World, Menulog was the second biggest player in the Australian food delivery industry with just short of 24 per cent market share in 2024, while the business generated $244m in revenue over the period.

University of Sydney senior lecturer Alex Veen told NewsWire a combination of increased competition from the likes of Uber and DoorDash, as well running a different employment model hurt Menulog.

“What the organisation did differently to some of the others, it tried to position itself as a ‘better’ platform especially in terms of its working competition,” Dr Veen said.

“A few years ago Menulog fully went in – backed by its parent company Just Eat – to move away from this independent contract model to an employment model and they betted quite heavily on that.”

Menulog ran a slightly different model to the others, originally as a two-sided marketplace allowing people to order from restaurants that may have used their own delivery staff, before moving to a three-sided marketplace model like its competition.

This means the app acted as a middle man between consumers, restaurants and couriers who were employed as independent contractors.

Menulog was relatively slow to swap to a three-sided model and was playing catch-up to Uber.

While Menulog was an early adopter of moving these independent contractors to staff members, closing the loophole laws sensationally hurt the business.

As part of sweeping changes, the Australian government announced the Closing Loophole Act in 2023 which made sweeping reforms designed to change industrial relations.

These included setting minimum standards for workers in the gig economy and road transport, as well as redefining casual workers, criminalising wage theft, same work-same pay laws, and the “right to disconnect” laws.

“What we’ve seen is that its initiative was overtaken by some of the regulatory developments here in Australia, particularly by the Albanese Labor government’s closing the loophole bill,” Dr Veen said.

“That has legitimised the platform business model being run by the Uber Eats of the world while Menulog had heavily betted on shifting gradually towards an employment model, which they found quite difficult to operate.”

When asked if Menulog was punished for doing the right thing, Mr Kaine said change came too late to help Menulog.

“What we really need is a level playing field in this industry,” he said.

“What it will mean is that rather than companies being in this ongoing cutthroat fight where they challenge each other for market share by screwing down the amount they pay to workers and restaurants, they’ll be a level playing field.

“That’s what Menulog was craving but it was not put in place in time.”

Mr Kaine said the closing the loophole legislation allowed the Fair Work Commission to inquire into the “lack of standards” for the gig economy.

“This is a really significant part of the costs for these businesses, in any transport business labour is somewhere between 30 to 50 per cent of the cost,” Mr Kaine said.

“If there is a free-for-all and no regulation, what it means is that companies compete on the basis of squeezing workers to the lowest they can.

“That is not only unfair for workers, but it can be deadly as there’s been 17 workers who have lost their lives in the last number of years because the work is inherently dangerous.”

What will it mean for workers?

Menulog shutting down will mean 120 Australians will directly lose their jobs.

The food delivery service said “all impacted employees will be fully supported with generous redundancy packages above legal requirements and outplacement support.”

They are also saying there will be a two-week transition period before the app closes on November 26.

Menulog said eligible couriers would be entitled to receive a four-week voluntary payment.

Eligible couriers who have completed their first delivery at least six months prior to today’s announcement and have completed a successful delivery within the last eight weeks are also eligible for payments.

The total number of couriers eligible is yet to be determined.

“This is a company that has shown over time that it has good intentions and I think it is showing that on its way out,” Mr Kaine said.

“Of course we will hold them to that … That is, strictly legally, not required but it is a decision Menulog has made and I think they want to leave on the best terms possible.”