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Foodora owes more than $4.7M to restaurants and creditors across Canada
A Foodora courier is pictured as they pick up an order for delivery from a restaurant in Toronto, Thursday, Feb. 27, 2020. (THE CANADIAN PRESS / Nathan Denette)
TORONTO -- Food delivery app Foodora owes more than $4.7 million to hundreds of restaurants across Canada and other creditors after initiating bankruptcy proceedings earlier this week.
The company’s decision to leave the Canadian market comes after couriers took steps to unionize, with the Ontario Labour Relations Board recognizing earlier this year that drivers had the right to form a union.
Details of the company’s debts were revealed in 88 pages of insolvency filings that include the names of every creditor that is owed at least $250. The vast majority of those companies are restaurants that have yet to be paid.
Some, like a Booster Juice in Mississauga, are owed as little as $250, while others, like a fried chicken restaurant in downtown Toronto, are out more than $2,000. Other creditors, including the Canada Revenue Agency and Google, are owed hundreds of thousands of dollars.
Foodora has operations in 10 cities with more than 3,000 restaurants available through its app.
CUPW, the union that was helping Foodora’s couriers unionize, called the company’s announcement “grossly unfair and unreasonable” for the hundreds of workers who’ve been let go in the middle of the pandemic.
The company’s plans to file bankruptcy come at a challenging time for restaurants that have had no choice but to shut down or offer limited take-out service during COVID-19. Many restaurants have raised concerns about their ability to stay afloat, with a recent survey finding that half of all restaurants surveyed don’t expect to survive COVID-19.
Foodora announced Monday that it will cease operations in Canada on May 11, five years after it opened. In a press release, the company said it is putting together a proposal "to provide additional recovery to employees and other creditors" but the details of the proposal "have not yet been determined.”
The app will continue to offer food delivery in other countries, including Finland, Austria, Sweden and Norway.
With files from The Canadian Press