Pressure on the government to align employment status laws to the modern gig economy intensified yesterday after a tribunal found that Hermes couriers were workers rather than self-employed.
Leeds Employment Tribunal held that several of the company’s couriers were entitled to workers’ rights. A further hearing is to be arranged to determine the unpaid holiday pay and national minimum wage due to the couriers, along with any unlawful deductions they may be able to claim back.
Trade union GMB, which helped to bring the case, hailed the decision as a “landmark legal victory”.
"This is yet another ruling that shows the gig economy for what it is – old-fashioned exploitation under a shiny new facade,” said Tim Roache, GMB general secretary, adding that he thought the ruling could affect more than 14,000 Hermes couriers across the country.
And Frank Field, Labour MP for Birkenhead and chair of the work and pension select committee, said the decision was a “mega knockback to those companies still using old means of exploiting vulnerable workers”.
Experts are now questioning the government’s apparent inaction in clarifying gig economy law, given the growing number of employment status cases being decided in workers’ favour.
“The decision further emphasises the need for legislative reform that was called upon following the Supreme Court decision in the Pimlico Plumbers case,” said Hina Belitz, specialist employment lawyer at Excello Law. “It is now the role of the government to take long-overdue action to provide clarity to both employers and employees operating within the gig economy."
Simon McVicker, director of policy at IPSE, the association for independent professionals and the self-employed, added: “The uncertainty about who is and who isn’t genuinely self-employed must stop. It is unacceptable that policymakers are relying on costly, time-consuming court cases as the first port of call in determining employment status.”
This latest employment status decision comes less than a month after the Supreme Court decided that Gary Smith, who worked for Pimlico Plumbers for six years before suffering a heart attack, was a worker rather than self-employed.
Other companies challenged in the courts over employment status recently include Addison Lee, Uber and CitySprint.
The government-commissioned Taylor review, which was published last July, made a number of suggestions for clarifying employment status in a bid to stop people enduring lengthy court cases to enforce their rights. The government has more recently launched a series of consultations off the back of its suggestions, including one on employment status, which closed earlier this month.
A Hermes spokesperson said the company would consider the decision carefully but was unlikely to launch an appeal.
“We have always been fully prepared for any outcome of this decision and its impact [on couriers],” the spokesperson added. “In the meantime, it is business as usual and we remain committed to providing couriers with the benefits of flexible working and the ability to earn well in excess of the national living wage.”