In a deal reached earlier this month with one of the UK’s largest trade unions, the courier company Hermes is offering its self-employed drivers the option to obtain some of the rights enjoyed by regular employees, including a guaranteed minimum wage and holiday pay, the Guardian reported:
Under the agreement with the GMB union, Hermes’ 15,000 drivers will continue to be self-employed but can opt into contracts with better rights. The deal comes after almost 200 Hermes couriers won the right to be recognised as “workers” at an employment tribunal last summer in a case backed by the GMB. Under employment law, “workers” are guaranteed rights including holiday pay, the legal minimum wage, minimum rest breaks and protection against unlawful discrimination.
The GMB has been active in advocating for the rights of British workers in the gig economy, also backing similar labor tribunal cases against other companies operating on an independent contractor model, including Uber, which lost a landmark case in 2016. Other British unions and union federations have also supported claims regarding the rights of gig economy workers, with tribunals ruling in favor of the workers in most of these cases. The settlement reached this month means that Hermes will drop its planned appeal against the ruling last year, while the GMB will refrain from pursuing further litigation against the company.
The “worker” classification in UK employment law defines a space between employees and the self-employed, but the tests for classifying workers as such are primarily defined by case law and increasingly unclear as technological shifts have brought about changes in the way people work. The Taylor Review of modern working practices recommended in its 2017 report that the government relabel “workers” as “dependent contractors,” write a clearer definition of this category into law, and make it the default status for companies that have a self-employed workforce above a certain size. The government said last year that it would adopt most of the review’s recommendations, but did not commit to writing this “worker by default” model into law.
Yvonne Gallagher, A partner at the London-based law firm Harbottle and Lewis, commented to Personnel Today that the Hermes deal would raise some questions about these drivers’ tax and national insurance obligations: