Foodora will exit Australia amid accusations of unfair dismissal and sham contracting, with the company saying it would defend itself against the claims.
Food delivery service Foodora announced it will leave the Australian market on August 20 in the midst of ongoing lawsuits.
In a statement released on Thursday, Foodora said it was ending operations "in response to a shift in focus towards other markets where the company sees a higher potential for growth".
The company will "fully utilise its resources to ensure employees find suitable alternative roles, as well as support partners and contractors during this transition".
Country manager at Foodora Australia Jeroen Willems said, "we wish to express our gratitude to all of our customers, contractors and employees for their dedication to Foodora Australia, and for allowing us to be a part of their every day".
It had been competing against others in the food delivery industry including Uber Eats and Deliveroo.
According to the ABC, it appears Foodora has not informed all of its delivery riders about the decision.
Court cases ongoing
But Foodora will still need to defend two lawsuits locally.
The company will return to the Fair Work Commission to defend an unfair dismissal case brought by delivery rider Joshua Klooger who appeared before the commission in June.
Mr Klooger, 28, began working for Foodora in Melbourne in 2016. He alleged he was unfairly dismissed in March 2018 when he started speaking publically about his pay and working conditions.
"They seem to just be focused on … the business owners and the stakeholders," he told SBS News in June.
"[Foodora] doesn't care at all about the workers who do the hard work."
In relation to Mr Klooger's case, a Foodora spokesperson on July 3 said: “As the matters are currently before the courts, it is not appropriate for Foodora to make any comment at this time.”
In the second case, Australia's Fair Work Ombudsman has launched legal action against Foodora, accusing the company of sham contracting and underpayment.
Foodora in June said it could not comment because the matter was before the courts.
"However, Foodora will be defending the claims and accusations that have been made against the business," it said in a statement.