Hermes Legal Action - What This Means for the Gig Economy

blog-publish-date

03 May 2018

blog-read-duration

The latest legal chapter concerning workers’ rights in the so called gig economy has begun, with eight delivery drivers taking action against their employer Hermes.

The workers’ status case is around how Hermes categorises their drivers as self-employed, which means they are not entitled to employment rights such as minimum wage, paid holiday or minimum rest breaks. The drivers have commenced employment tribunal proceedings claiming they are actually workers who should receive worker rights. The claim against Hermes follows a number of high profile cases against other employers within the so-called ‘gig economy’, including Uber and Deliveroo. In 2016 the ride-hailing firm Uber was told its drivers should be classed as “workers” with minimum-wage rights. Uber, which says its drivers are self-employed, lost its appeal against the decision last year but said it would appeal again. The case could end up in the Supreme Court this year. The Hermes claim mirrors several other similar tribunal hearings – including verdicts in cases brought against Uber, Addison Lee, City Sprint, Excel and eCourier – where judges have ruled that their staff should be given the legal classification as “workers”, thereby receiving the minimum wage and holiday pay rights.

Expert Opinion

Whilst the majority of these cases have resulted in a finding that the claimant was a worker, there is no guarantee that a similar finding will be made against Hermes. Instead, the employment tribunal will review all the facts of the case including any documentation, whether the delivery driver is subject to control, and whether there is a right to substitute another person to carry out the work. Importantly, the tribunal will look beyond any documents or labels given to the individual to examine how the relationship actually works in reality. If they find, in reality, the individual is treated as if they were a worker then they will go on to find the correct status is that of a worker. A decision which finds Hermes have categorised their workforce incorrectly could lead to a substantial financial claim as they will have to reimburse any shortfall in wages or holiday pay, as well as go on to provide these in the future.

Expert Support

The Government has confirmed that businesses operating in the so called ‘gig economy’ will be required to pay their workers sick and holiday pay as part of the Taylor Review into Modern Working Practices. Full details will be made public in the forthcoming ‘Good Work’ plan by the Department of Business, Energy and Industrial Strategy. With more and more firms adopting working practices affected by the Taylor Review it’s essential for employers to ascertain the employment status of your workforce and ensure that they are receiving the correct entitlements. Download our free employment status factsheet here for guidance, or call an employment law expert today on 0808 145 3490.

Free to Download Employer Resources

  • Pay Awards & Forecast (September 2018)

    FREE DOWNLOAD

    Pay Awards & Forecast (September 2018...

    Read Croner Reward's expert settlement and forecast report for September 2018

    Read more
  • Sample Health & Safety Policy Statement

    FREE DOWNLOAD

    Sample Health & Safety Policy Stateme...

    Here we’ve included a free sample Health & Safety Policy Statement that UK business owners can refer to.

    Read more
  • Pay Awards & Forecast (June 2018)

    FREE DOWNLOAD

    Pay Awards & Forecast (June 2018)

    Read Croner Reward's expert Settlements and Forecasts report for June 2018

    Read more
  • Holiday entitlement - everything you need to know

    BLOG

    Holiday entitlement - everything you ...

    The annual employee holiday entitlement in the UK is 5.6 weeks. This figure is t...

    Read more
  • What is the best way for your employees to clock in and out of work?

    BLOG

    What is the best way for your employe...

    Clocking in and out of work may be a necessity for your workplace, but it can al...

    Read more
  • How Much Does Employee Turnover Cost Your Business?

    BLOG

    How Much Does Employee Turnover Cost ...

    A recent Glassdoor survey revealed that almost 35% of hiring professionals expec...

    Read more
  • bemrose-school-derby

    CASE STUDY

    Bemrose School Derby

    “Having Croner-i saves us a lot of time and money, as we do not have to use cred

    Read more
  • wmtr

    CASE STUDY

    WMTR

    “I’d definitely recommend the Croner OnSite services and I have done already, I

    Read more
  • certikin

    CASE STUDY

    Certikin

    “Our Distribution Manager had a particularly technical query relating to respira

    Read more

Ready to focus on what you do best?

Get your free consultation and speak to an expert today.