A good gig

Published on: 08/02/2019


As we blogged at the time, an employment tribunal decided last year that a group of Hermes couriers, whose written contracts described them as self-employed business people drivers, in fact had the statutory status of “worker”. This includes the right to be paid at least the national minimum/living wage, to receive holiday pay and to seek union recognition.

Those claims, on behalf of fewer than 200 out of the total 14,500 UK Hermes drivers, were backed by the GMB union. This week, the union and Hermes have broken new ground in the gig economy by reaching a novel agreement regarding employment status and union recognition to be able to bargain over pay.

The drivers are being offered two options:

  1. Continuing to work according to the current written contractual terms, where pay depends on deliveries made.
  2. Moving to a new contract paid on an hourly rate basis, with Hermes agreeing that the union can negotiate pay for drivers who take this option. The initial hourly rate will be an average minimum of £8.55 per hour.

This is a pragmatic and forward-looking solution and shows what can be achieved when entrenched adversarial positions are put aside.

It appears that the union has agreed not to back any more minimum wage and holiday pay claims, in return for recognition by Hermes to negotiate on behalf of those drivers who opt into the new contract. This means the union does not have to go through the process of seeking recognition against the company’s wishes, which involves demonstrating likely majority support and other procedural hurdles.

The drivers now have the explicit option of choosing what best suits them. While it would be open to drivers to remain on the current terms and claim for holiday pay and any shortfall on the national minimum/national living wage, including back pay for up to 2 years, they would be doing so without union support.

Hermes most probably estimated the likely proportion of drivers who would take each option and the impact this agreement would have on their business before deciding that positive engagement with the union is preferable to a breakdown in workplace relations.

The deserved positive publicity will no doubt assist with their retaining and expanding their client base of high-profile retailers.

For advice on strategic employee engagement and union relations, please contact our team of leading specialists.


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