Long subcontracting chains in the courier and parcel delivery sector are fuelling widespread labour violations, tax evasion, and bogus self-employment across Europe, according to a study by the European Platform tackling Undeclared Work.
The European Labour Authority’s Platform on Undeclared Work has released findings exposing how the courier, express, and parcel (CEP) delivery sector has become a breeding ground for labour exploitation through complex subcontracting arrangements.
The study’s findings were discussed at a webinar on 30 January, where ETF General Secretary Livia Spera participated in a panel on the role of social partners in tackling undeclared work through collective bargaining and multi-pronged approaches.
Speaking at the webinar, Spera highlighted that while social dialogue and collective bargaining can be effective tools in countries with strong frameworks, such as Italy, where even subcontracted drivers are covered by standards set out in the Logistics, Freight Transport, and Shipping National CBA, not all European countries are on equal footing. She emphasised that to build strong and capable social dialogue across Europe, solid EU-level legislation is essential to help tackle the problem. While the minimum wage directive is one such avenue, the study makes clear that subcontracting urgently needs EU attention.
The research reveals that major logistics companies, e-retailers, and postal operators routinely outsource delivery operations to networks of subcontractors, creating chains that obscure accountability and foster non-compliant labour practices. In some European countries, subcontracting has reached saturation: Germany outsources 50% of transport services, while in Poland the figure approaches 100%.
Systematic Violations Documented
Intermediaries within these subcontracting chains frequently misclassify workers as self-employed or underreport employment to evade taxes and social security contributions. Recent enforcement actions illustrate the scale of the problem. Italian authorities investigating DHL, GLS, and other companies seized €552 million in assets linked to tax evasion. In January 2025, Milan’s financial police seized €46 million from FedEx after uncovering schemes using cooperatives and shell companies to bypass VAT and social security contributions.
A 2020 inspection by Dutch labour authorities found that nine out of ten subcontracted parcel delivery companies had committed irregularities or violations.
Power Imbalances and Enforcement Challenges
The study identifies economic dependence as a critical factor that enables undeclared work. In France’s Île-de-France region, only 10% of couriers are directly employed by parcel delivery companies, with more than half of subcontractors generating their entire turnover from a single contractor.
“The use of long subcontracting chains conceals the involvement of major logistics service providers, e-retailers, and postal incumbents, thereby complicating the identification of those who benefit from non-compliant labour practices,” the study states. “Economic dependencies between subcontractors and principal contractors engender a power imbalance that fosters undeclared work and adverse working conditions.”
Labour inspectorates across Europe struggle to keep pace with violations due to their frequency, insufficient regulatory oversight, and the mobile nature of the work.
Call for EU Action
ETF and its affiliated unions have long recognised subcontracting in transport, including parcel delivery, as a systemic problem. In a 2024 joint manifesto with EFBWW and EFFAT, ETF called specifically for an EU Directive to regulate subcontracting, limit its use, establish comprehensive, full-chain joint and several liability, and ensure sanctions are effectively enforced with adequate numbers of labour inspectors.
Building on this momentum, ETF, EFFAT, and EFBWW are mobilising their affiliates for a demonstration in front of the European Parliament in Strasbourg next Thursday, 10 February, to demand urgent EU-level action on subcontracting regulation.
The full study, “Key Challenges in Tackling Undeclared Work in the Courier, Express, and Parcel Delivery Sector“, is available from the European Labour Authority.