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Hermes Drivers to Challenge Self-Employed Status as Government Encouraged to Close Loopholes

on Friday, 12 May 2017.

Hermes drivers have become the latest group of workers to challenge their self-employed status in the employment tribunal, as HMRC and the government take steps to clarify this issue.

Following recent challenges to employment status against gig-economy companies such as Uber, CitySprint and Deliveroo, the GMB trade union has now brought a claim against delivery company, Hermes, over its drivers' employment conditions. The GMB is arguing that the drivers are 'workers' under their current working arrangements and are not independent contractors. This would entitle them to statutory employment rights, including paid annual leave, holiday and sick pay and pension contributions.

This latest challenge coincides with an investigation currently being conducted by HMRC into whether or not Hermes drivers should be classified as 'self-employed'. As part of the investigation, Hermes drivers have reportedly been requested to provide written contracts and payslips. In addition, Hermes has been asked to attend a one-hour interview with HMRC to discuss their current employment classifications.

Work and Pensions Committee Report

In a report published on 1 May 2017 by the Work and Pensions Committee, the government is being encouraged to close any legal loopholes that allow companies operating under the gig-economy to engage their workers on a 'self-employed' basis. In particular, the Committee has stated the government must prevent 'bogus' self-employment practices, which are potentially placing an additional burden on the welfare state and reducing tax contributions. Frank Field, chair of the committee, said: "This inquiry has convinced me of the need to offer 'worker' status to the drivers who work with those companies as the default option. This status would be a much fairer reflection of the work they undertake which seems to fall between what most of us would think of as 'self-employed' or 'employed'."

What to Expect on 'Worker' Status

The Work and Pensions Committee report is the latest in a number of reports recently published on self-employment and worker status following the growing trend in claims being brought against gig-economy companies in this area. The Taylor Report, led by Matthew Taylor, is perhaps the most high-profile of these reports and is expected to be published in the next few months. The report is expected to contain significant proposals in relation to modern working practices in the UK and bring welcome recommendations on employment status.

We will keep you updated on the developments of the Taylor Report when it is published.


For more information, please contact Eleanor Boyd in our Employment Law team on 020 7665 0842.

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