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Hermes hits short term contract economy head-on with ‘self-employed plus’ status

The GMB Union has described a move by Hermes to offer its couriers a new ‘self-employed plus’ option as ‘ground-breaking’, hailing it a turning point in the fight between employers and the gig economy.

Setting out to meet the challenge of employment status and workers’ rights in today’s fast-evolving employment landscape, the courier company has been in discussions with the union about a new style of agreement.

What are workers entitled to under self-employed plus?

If couriers choose to opt-in to the new self-employed plus arrangement they will be rewarded with extra benefits, which include paid holidays, individually negotiated hourly pay rates and full GMB representation access, if they become members of the union.

Couriers can choose not to adopt the new status and stay with the current arrangement which gives them the flexibility to earn higher rates of pay. However, they will not be entitled to any of the benefits associated with self-employed plus.

The “self-employed plus” arrangement is much closer to what most employers would regard as employment. Hermes will provide guaranteed hourly rates in return for being able to insist that self-employed plus couriers use software which enables Hermes to control the routes taken by delivery drivers in order to maximise efficiency.

What are the potential implications for the gig economy?

This move follows a seemingly endless string of gig economy cases, many of them involving driver and courier firms, including Hermes. Effectively, Hermes is creating a new category of individual service provision following a decision in the Employment Tribunal last year which went against them. In that hearing, it was decided that the claimants were workers rather than self-employed and therefore entitled to holiday pay and minimum wage.

So, is it taking us any further forward in the understanding of modern working practices and how employers can meet the demands of a changing society without falling foul of the law?

If anything, it could actually muddy the waters further, adding a new level between self-employed and worker. It could even be seen as an attempt by employers to avoid providing full worker status and benefits to those who should be eligible for them by law.

However, it does begin to recognise a reality that I have spoken about at length in my previous article about the need for more flexibility in the workplace to meet the changing expectations of employees.

If your company deals with short term contractors and you need to know more, get in touch with Richard Port and his employment law team at Boardside.