Thailand is developing a minimum compensation framework for app-based delivery riders, aiming to establish rules that could extend beyond the current dispute involving Lalamove to encompass digital platforms more broadly. Digital Economy and Society Minister Chaichanok Chidchob stated that the ministry is gathering data on rider expenses and payment rates to formulate a minimum-rate structure. This study will expand beyond Lalamove and its riders to include other platforms and worker groups before a benchmark is determined. This initiative could lead to legislation for platform workers, a sector currently lacking specific laws to regulate compensation.
Discussions with the Electronic Transactions Development Agency (ETDA) and the Labour Ministry have explored the possibility of creating separate legislation for platform workers, distinct from a broader independent-worker bill. This is due to their unique work arrangements and operating costs compared to other self-employed individuals. Consequently, the ongoing disagreement over Lalamove’s rates may have wider implications.
The ministry is incorporating the discussions between Lalamove and rider representatives into its process for identifying costs to be included in minimum rate calculations. However, Minister Chaichanok emphasized that the government currently lacks the authority to unilaterally mandate payment increases for individual platforms. Instead, the objective is to establish a broader standard that can be legally supported in the future.
The most recent tripartite discussions involving the ministry, ETDA, Lalamove, and rider representatives occurred on September 17. According to ETDA, the parties reached a general agreement on the factors to consider for minimum compensation, but the specific figures for the formula remain unsettled.
A key point of contention is the per-kilometer earnings riders should receive. Rider representatives are advocating for a rate of 10 baht per kilometer, citing their own calculations of operating costs at 6.69 baht per kilometer. These costs include fuel, vehicle maintenance, life insurance, and other expenses, with a 400-baht minimum wage used in their calculations. Lalamove disputes this methodology, arguing that minimum wage is not a suitable basis for determining rider costs. The company has not agreed to the proposed 10-baht rate and is still reviewing its payment structure.
There is also a significant disagreement regarding the prevalence of low-paying jobs. Rider representatives claim approximately 80% of jobs pay less than 3.70 baht per kilometer, while Lalamove’s data suggests this figure is closer to 3%, a decrease from previous estimates. Minister Chaichanok noted that Lalamove’s underlying operational data has not yet been submitted for ministry review, leaving these competing figures unresolved. While Lalamove has expressed willingness to share information, companies are not currently obligated to disclose commercially sensitive data. The ministry has requested Lalamove to consider adjusting its rate structure to ensure no rider receives less than 3 baht per kilometer, a proposal the company is still reviewing.
In response to some rider concerns, Lalamove has already implemented changes. These include reducing suspensions for refusing jobs from three days to one, establishing a complaint and appeals hub, and introducing a choice between 5-kilometer and 10-kilometer job-radius settings.
For riders on other applications, the development of the minimum-rate study is of greater significance. Minister Chaichanok stressed the need for information from a wider range of platforms and workers to ensure any future formula is not based on the conditions of a single company. This broader dataset will inform the ministry’s determination of includable costs and how a minimum compensation level might be applied within a future legal framework.
The independent-worker bill had progressed through the Council of State prior to the government change, but further consultation and review are anticipated. Current discussions are examining whether platform workers should be covered by separate legislation. No minimum rate has been agreed upon, and there is no certainty that the figures discussed in the Lalamove negotiations will become the standard for other platforms. Further discussions are expected after Minister Chaichanok’s return from the United Nations General Assembly, during which he plans to meet separately with rider representatives and Lalamove, while officials continue to collect data from other segments of the platform economy.