s.536LU - Application for an unfair deactivation remedy

Unfair deactivation - objection that respondent complied with the Fair Work (Digital Labour Platform Deactivation Code) Instrument 2024 - whether there was a valid reason for deactivation based on driver's low satisfaction rating - whether deactivation was unfair

• [1] The applicant in this matter, Mr. Ali, was an 'employee-like worker' for the purposes of section 15P of the Fair Work Act 2009 (Cth) (Act) who performed work as a delivery person, picking up and delivering food and groceries to consumers on the Uber Delivery Platform (Platform). The respondent is a 'digital labour platform operator' within the meaning of section 15M of the Act. The applicant is a person protected from unfair deactivation.[1]

• [2] The Applicant commenced performing work for the respondent on 3 April 2024. The Applicant's account on the Uber Delivery Platform was deactivated on 29 May 2025 (Deactivation Date) due to low satisfaction ratings. The applicant has commenced proceedings under s.536LU of the Act alleging that he had been unfairly deactivated from the Platform by the respondent. The respondent has objected to the application on the basis that it has complied with the Fair Work (Digital Labour Platform Deactivation Code) Instrument 2024 (Code) in relation to the deactivation.

• [3] Section 536LW(c) of the Act requires the Commission to determine whether the deactivation was consistent with the Code prior to any assessment of the merits of the application. A person can only be unfairly deactivated if the Commission is satisfied that the person has been deactivated from a digital labour platform, the deactivation was unfair[2] and the deactivation was not consistent with the Code.[3] The respondent's objection was heard at the same time as the substantive application. For the reasons that follow I have determined that the deactivation was not consistent with the Code. However, I have also concluded that the deactivation was not unfair in the circumstances and that the application should be dismissed.

• [4] The applicant entered into a services agreement with the respondent on 27 March 2024 (Services Agreement). As part of the Services Agreement, the applicant agreed to comply with the terms of the respondent's community guidelines (Community Guidelines).[4] The Community Guidelines refer to the respondent's ratings system and the prospect of drivers losing access to the Platform if minimum average ratings are not met.[5]

• [5] On 21 March 2025, the respondent sent the applicant an in-app message (Initial Warning) informing him that, amongst other things, his satisfaction rating was below the minimum threshold for delivery workers in Perth which was 85%, he was required to maintain ratings above the minimum satisfaction rating to keep his access to the Platform and, if he continued to receive ratings below the minimum satisfaction rating, his account may be at risk of deactivation. This communication was provided in addition to the processes outlined in the Code and which are set out below.

• [6] On 19 April 2025, the applicant was provided with a written notice, warning him that he risked being deactivated from the Platform (Deactivation Warning). I have considered the form and content of the deactivation warning and am satisfied that it meets the requirements of s.8 of the Code. In particular, the Deactivation Warning notified the applicant that he risked the deactivation of his access to the Platform due to his satisfaction rating being below the minimum threshold required for his city and risked the deactivation of his access to the Platform if the issue continued. The Deactivation Warning included sufficient information to enable a reasonable person in the position of the applicant to understand the matters in it.

• [7] I am also satisfied on the evidence that the respondent was entitled to commence the deactivation process outlined in Division 3 of the Code because it met the threshold requirements outlined in subsection 10(b) of the Code. The respondent had:

(a) previously issued the applicant with the Deactivation Warning;

(b) reasonable grounds to consider deactivation of the applicant's account was justified because:

(i) the applicant had not, within a reasonable time, improved his satisfaction rating to the standards expected by the respondent, being the minimum satisfaction rating of 85% in Perth;

(ii) the applicant's low satisfaction ratings continued in the weeks following the Deactivation Warning; and

(iii) the applicant had maintained a low satisfaction rating despite receiving the Initial Warning and the Deactivation Warning.

• [8] The respondent gave the applicant a preliminary deactivation notice (PDN) on 22 May 2025. That notice complied with the requirements of s.11 of the Code. It set out the reason for which the notice was given and that the respondent was considering deactivating the applicant's access to the Platform. It also provided that the applicant had a right to respond and indicated that the applicant could appoint a support person. The PND provided sufficient information to enable a reasonable person in the applicant's position to understand the matters in the notice.

• [9] The PND also advised the applicant that his access to the Platform was being suspended with immediate effect.[6] The suspension was consistent with the provisions of s.12 of the Code. The respondent had the right to suspend the applicant's access to the Platform under s.12(1). The PND specified the time and day from which the suspension took effect and the consequences of suspension.[7]

• [10] The steps taken by the respondent after issuing the PND met the requirements of s.13 of the Code including because it afforded the applicant an opportunity to respond to the PND (which the applicant availed himself of) and because a human representative of the respondent considered the applicant's response at the applicant's request within a reasonable time[8] and determined that no further inquiries were warranted. That determination was reasonable having regard to the applicant's response.[9]

• [11] I consider that the respondent complied with its obligations under s.14(1) and (2) of the Code by deciding to terminate the applicant's access to the Platform and notifying the applicant of that outcome as soon as reasonably practicable.[10] A Final Deactivation Notice (FDN) was issued to the applicant on the same day that the decision to deactivate was made, being 29 May 2025. I also conclude that the reason for termination was a valid one[11] in that it was 'sound, defensible or well-founded' and not 'capricious, fanciful, spiteful or prejudiced.'[12] The valid reason was of a kind described in s.19(2) of the Code as one that may be a valid reason to deactivate an employee-like worker from the Platform if it arises in the course of the worker performing work through the Platform.

• [12] I am also satisfied that the respondent considered, on reasonable grounds, that the reason had been established. This does not require a finding as to whether or not the conduct occurred, but an assessment as to the respondent considered, on reasonable grounds, that the reason has been established.[13] The respondent's evidence included details of the applicant's response to the proposed deactivation. This showed that the applicant accepted, at least to some degree, that he had not met customer expectations or the standards required of drivers by the respondent and accepted responsibility for these shortcomings. This, in addition to the evidence available to the respondent as to the applicant's ratings history, provides a basis for the respondent to consider, on reasonable grounds, that the reason has been established.

• [13] Section 14(5) of the Code specifies that a FDN must give notice to an employee-like worker of certain things. This includes, at s.14(5)(d) specification as to when and how any final payments to the worker will be made. Section 14(6) requires the FDN to contain sufficient information to enable a reasonable person in the position of the employee-like worker to understand the matters mentioned in s.14(5). The FDN is deficient in that it does not contain any details as to final payments to be made to the worker. In that respect, compliance with the Code has not been achieved and I am therefore required to consider whether the deactivation was unfair.[14]

• [14] In considering whether a deactivation was unfair, the Commission must take into account the matters specified in s.536LH(1). These are whether there was a valid reason for the deactivation related to the person's capacity or conduct, whether any relevant processes of the Code were followed and any other matters the Commission considers relevant.

• [15] In relation to the issue of valid reason, the applicant submitted that the ratings system applied unfairly in his circumstances because he was only working on a limited number of days, generally two, each week and only a low percentage of customers rated the services he provided. He said that as the ratings system relied on a driver's 100 most recent ratings, it was not possible for him to obtain a sufficient number of positive ratings to improve his overall rating in the time allowed prior to deactivation.

• [16] At the time of his deactivation the applicant's overall rating was 73% which was below the 85% threshold established by the respondent for the city of Perth where the applicant worked. The applicant had accepted that the respondent could utilise a ratings system to measure the applicant's performance when he accepted the terms of the Services Agreement on 27 March 2024. The ratings system was a requirement of the Services Agreement, the conditions of use of the Platform and the respondent's standards in relation to quality, service level or performance.[15] The applicant was on notice through the terms of the Services Agreement that he had entered into, and the Community Guidelines, of the requirement to maintain a level of customer satisfaction and that loss of access to the Platform could follow if the minimum ratings level was not met.

• [17] The applicant accepted that it was a matter for him and not the respondent to determine the amount of work that he performed using the Platform. He also accepted that he had the capacity to check his rating by using the respondent's application at any time.

• [18] On the basis of the evidence of Ms. Fairlie I am satisfied, for reasons similar to those articulated by Deputy President Saunders in Kumar, that the 85% customer satisfaction rating system was reasonable in the circumstances and that there was an evident and intelligible justification for maintaining that requirement.[16] The requirement was reasonable to maintain the quality of the service and avoid negative impacts on the respondent's business.[17]Moreover, I am of the view that even allowing for unreasonable or inaccurate customer ratings, the applicant failed to meet the obligation to maintain an average rating of 85% required by the Services Agreement[18] and the Community Guidelines.

• [19] It was not disputed that the number of ratings given by customers and merchants is low compared to the total number of deliveries performed. The respondent's evidence was that in the first 6 months of 2025, only 7% of all orders were rated by consumers or merchants.[19] It can reasonably be inferred that there will be many satisfied customers who do not provide any rating at all. However, the respondent's uncontested evidence was that where ratings are given, they are overwhelmingly positive.[20] I accept that it may be difficult for a driver, particularly one regularly working only a limited number of hours or days, to lift the overall rating in a short period of time. The number of deliveries undertaken is likely to have a bearing on the total number of ratings provided but not necessarily the proportion of positive versus negative ratings. Given the highly automated nature of the processes that the respondent has in place, and taking into account that the 100 most recently rated deliveries is the benchmark by which a driver's performance is assessed, there may be circumstances where a driver is simply unable to address poor ratings in the time allowed. This is so even though drivers are able to monitor their own ratings at all times and determine, subject to their own circumstances, the amount of work that they do. However, in my view this is not such a case.

• [20] The applicant maintained that he only received 11 customer ratings in the period between 13 February and 21 April 2025. However, these figures appear to be based only on some weekly warnings that were provided to the applicant and are incomplete. The evidence of the respondent, which I accept, shows that in the period between 13 February 2025 (when the applicant said he had started to be notified by the respondent of poor weekly satisfaction ratings) and 21 March 2025 (being the date of the Initial Warning), the applicant undertook 136 deliveries of which 10 were rated. Of those rated, 80% were positive satisfaction ratings. In the period 21 March to 19 April 2025 the applicant undertook 104 deliveries of which 11 were rated and 64% of these were positive satisfaction ratings. From 19 April until 22 May 2025 there were 158 deliveries by the applicant, 20 of which were rated by customers resulting in a 70% satisfaction rate for the applicant in that period.[21] Thus, in the period referred to above, there were 41 customer-rated deliveries. This number of ratings was sufficient to have a material and positive impact on the applicant's overall rating, being the 100 most recent ratings, if there was a significant increase in the number of positive ratings. Unfortunately for the applicant, this did not occur. Further, the fact that the applicant's satisfaction rating did not exceed 85% in any of these periods was also relevant to how the deactivation process unfolded over time. Ms. Fairlie's evidence, which I accept, was that the low ratings process would have been paused and not progressed to the next phase had the applicant achieved a satisfaction rating beyond 85% in any of those periods.

• [21] I have also taken into account the respondent's evidence in response to the applicant's assertion that his negative ratings were affected by matters beyond his control and note that many of the recorded, albeit standard form, comments indicate dissatisfaction with the applicant's conduct such as poor communication, unprofessional behaviour and missed instructions. The applicant also contended that his ratings were adversely affected by damaged or undelivered goods despite reporting them as damaged through the help function on the respondent's app. However, the respondent's evidence shows that this was not the case because no ratings were received in respect of those deliveries.

• [22] Overall, I conclude that there was a valid reason[22] for the deactivation of the applicant related to the applicant's capacity or conduct.

• [23] My assessment of compliance with the relevant processes in the Code is set out above and I have taken this into account in the assessment of unfairness. I observe that although there was not complete compliance with all relevant aspects of the Code, there was substantial compliance by the respondent.

• [24] As to other relevant matters, I note that a delivery person can review their ratings at any time using the respondent's delivery application and that the respondent notifies delivery drivers when they have reached the minimum ratings threshold and provides them with some limited resources on how to improve ratings. The applicant began receiving notifications from the respondent in February 2025 and, putting aside his capacity to review his own ratings at any time, was on notice of the ratings issue and had an opportunity to improve his ratings from at least that point. I have also taken into account the applicant's length of service with the respondent and his evidence that in the initial months, he performed strongly and had no complaints about his rating. I have also considered the processes adopted by the respondent in effecting the deactivation.

• [25] In my assessment the applicant was not unfairly deactivated by the respondent and no remedy is available to him.[23] The application is dismissed.

Mr Will, solicitor of Dentons Australia, with permission, on behalf of the Respondent

[4] Clause 5.1(l) of the Services Agreement.

[5] See also Services Agreement at clause 14.2(b)(ii).

[12] Selvachandran v. Peterson Plastics Pty Ltd [1995] IRCA 333; (1995) 62 IR 371 at 373 cited in Kumar v. Portier Pacific Pty Ltd [2025] FWC 2275 at [8].

[17] Mohamed v. Portier Pacific Pty Ltd [2025] FWC 2337 at [3] and Kumar v. Portier Pacific Pty Ltd [2025] FWC 2275 at [37] and following

[18] Services Agreement clause 14.2(b)(ii).

[20] 93% of ratings given were positive in the period January to June 2025 - ibid at [24].

[21] Exhibit R2 at [32] and Annexure K.

[22] See Hotak v. Rasier Pacific Pty Ltd [2025] FWCFB 214 at [94].

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