A deal between Hermes, the UK delivery company, and the GMB union to give couriers rights to minimum hourly rates and holiday pay is being hailed as a landmark in the debate over how to handle workers rights in the gig economy.
But is it really much of a victory for gig economy workers?
One of the features of the deal is that Hermes couriers will have the right to opt-in to a new “self-employed plus” contract that will give them a guaranteed hourly rate of £8.55 and paid holidays.
Equally, they can chose to retain their current status as self-employed contractors if they prefer.
On the face of it this was a victory for the unions, who have been arguing that gig economy workers – people paid per unit of work rather than by the hour – should be allowed more or less the same rights as everyone else.
Get the Sifted Newsletter
“Landmark agreements like this show that with collective action and a powerful union more people can win more protection at
work. Gig economy companies are starting to realise that skipping basic rights and protections is bad for business,” says Usman Mohammed, lead campaigner at Organise, which helps workers campaign for better conditions.
But it also appeared to give a legal precedent employment law does not necessarily apply to everyone.
“This deal is a step forward on trade union representation but dangerous on the issue of respecting employment law,” says Jason Moyer-Lee, general secretary of the Independent Workers Union of Great Britain (IWGB), which is supporting workers in cases against Uber, the ride-hailing service, Addison Lee, the taxi company and CitySprint, the courier service.
“The idea that those couriers who want to can opt in is sanctioning the idea that employment law is optional.”
“Yes it is good that Hermes is recognising the trade union but the idea that those couriers who want to can opt in is sanctioning the idea that employment law is optional.”
The Hermes deal comes after 15 of the company’s couriers won an employment tribunal case last June, giving them the right to be classed as workers rather than self-employed. The case, which was supported by the GMB union, opened the way for the rest of the Hermes’ 14,500 couriers to seek worker status.
The opt-in arrangement is similar to one put in place in Denmark last August between Hlfr.dk, the Danish platform for hiring cleaners, and Danish trade union 3K. As with Hermes, Hifr.dk operates a two-tier system where cleaners can chose to be workers with minimum wage, holiday and sick pay as well as pensions, or work on a more casual basis. A huge number of cleaners are opting for the employment rights – at the end of last year Hilfr.dk co-founder Steffen Wegner Mortensen said the company was shortly expecting to have 50% of it’s cleaning hours to be covered by the agreement.
A key number to watch will be how many Hermes couriers opt for worker status. Moyer-Lee is concerned that Hermes will create a disincentive for couriers to become ‘self-employed plus’ by paying them less.
“There is a question over whether those who opt for the “self-employed plus” option will earn less.. The phrase in the press release that says some may wish to stay self-employed ‘and earn premium rates’ suggests that they might. Certainly there is nothing stopping the company from offering short-term inducements, or threats, to workers to give up their legal rights.”
Gig economy companies have been on the back foot recently when it comes to employment law. Employment tribunals ruled against Uber, the ride-hailing service, and Addison Lee, the taxi company, last year, saying that drivers had been wrongly classed as self-employed . The UK Supreme Court also ruled last year that a tradesman working for Pimlico Plumbers should be classed as a worker rather than self-employed. One of the few exceptions has been Deliveroo, the food delivery company, which won a significant legal battle over the issue in December.
The approach across Europe to gig economy rights has been mixed. In Spain, Oscar Pierre, CEO of Glovo, told Sifted he was frustrated with the inflexible approach taken by politicians, allowing no halfway house between workers with full rights and those working casually.
Matthew Taylor, chief chief executive of the RSA, writes in a blog post that the Hermes deal could mark a shift in underlying tactics of trade unions from simply taking companies to court towards negotiating agreements with “two-way flexibility”.
Get the Sifted Newsletter