Tag Archive for: gig economy

Courier Business Criticised For Charging Workers Over Absence

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Further shocking revelations regarding the employment methods of Britain’s gig economy, has shown that self-employed UK couriers who deliver goods on behalf of the firm DPD are being made to pay a fee of £150 for each working day they miss due to illness.

DPD is a renowned company that counts many of Britain’s most popular retailers among its clients, including Amazon, ASOS, Marks & Spencer, John Lewis and River Island.

Workers of the firm are speaking out over an unfair system that forces them to work even when they are sick, unless DPD sanctioned cover can be arranged by the worker for the time spent absent.

DPD is part of the global parcel service Geopost, which has a workforce of around 5,000 couriers; many of whom are self-employed and therefore only receive payment when available to work.

Speaking to the Guardian, a worker who choose to remain anonymous said:

‘I said I couldn’t come in because I was too sick and it wouldn’t have been safe for me to drive. He said: ‘Sorry, I have to charge you.’

The company insists the £150 fee reflects the ‘liquidated damages’ accrues during the loss of a day’s work, and that HM Revenue & Customs approved the scheme

DPD amassed a profit of £100m during 2015 and is expected to grow further as online shopping increases in popularity.

The fee system at DPD has been its standard practice for some time, but is only now being widely documented. This controversy of the contract follows months of tribunal hearings in which other gig economy businesses, such as Uber, Deliveroo and City Sprint, have been forced to grant better working rights to their self-employed staff.

One of the most vocal critics of the scheme is Frank Field, chairman of the Commons Work and Pensions committee, who said the following:

“The gig economy is producing wave after wave of evidence on the grim reality of life at the bottom of Britain’s labour market. A group of companies now controls the working lives of an unknown number of people, and yet evades its own responsibilities as employers and taxpayers by labelling those people as self-employed’.

The average DPD courier is paid £200 per day and will not receive payment for the time absent, therefore when combined with the fee, each daily loss totals £350.

A spokesman for DPD defended the company’s decision to collect a fee from its absent workers:

“Franchisees are contracted to provide a service. If they fail to do so, DPD have to fulfil that service and therefore reserve the right to charge the franchisee for the costs involved in doing so.”

This fee system is believed to have been in operation for several years at DPD but is only now being scrutinised. It also stresses how its couriers receive many benefits from the arrangement, including the right to an average annual wage of £37,000 after a year of service.

Like many other gig economy employers, it’s highly likely DPD will experience further analysis of its contracts to determine whether self-employment rights are being compromised, especially as so many reputable retailers rely on the company for deliveries.

Plumbing Firm Loses Appeal In Landmark Gig Economy Ruling

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In the greatest victory yet for a gig economy tribunal hearing, a plumber has won an employment rights case for a second time despite an appeal by his ex-employer.

Gary Smith worked as a self-employed plumber for the revered London firm Pimlico Plumbers over the course of a six year period. He took the firm to tribunal in 2011 to challenge his official status as a self-employed worker. After winning his case in 2014, Pimlico Plumbers launched an appeal which was finally heard in February 2017 and again saw Mr Smith win.

This marks a major ruling in employment law, as it is the first major undertaken by an employer of the gig economy to be rejected at tribunal. This loss is not a good sign for other businesses hoping to reverse recent tribunal rulings of a similar nature.

The claim brought by Mr Smith challenged legislation deeming him a self-employed contractor rather than a full employee. Although Smith was VAT-registered and paying tax in accordance with self-employed regulations throughout his six years at Pimlico Plumbers, he did not work for any other business during that time. He claimed this was due of a contract agreement that made him “tightly controlled” by the firm, and therefore found it it difficult to seek additional employment.

After Mr Smith suffered a heart attack in 2010 he requested the business reduce his working hours from five days a week to three. Pimlico refused and Mr Smith was allegedly dismissed shortly afterwards because of this.

Pimlico Plumbers founder, Charlie Mullins, disputes the claim, saying that workers are hired on a self-employed basis with a generous fee of £80,000, for which the company in return expect workers to provide their own materials for their daily job duties .

Pimlico Plumbers is one of the most prestigious plumbing businesses in Britain, having acquired a value in the region of £75 million since Mr Mullins, a prominent Tory Party donor, founded the company 45 years ago.

Mr Mullins expressed relief that gig economy law is now being clarified for employers. He claims Pimlico Plumbers has benefited from the change and joked “Like our plumbing, now our contracts are watertight.”

Key businesses of the gig economy like Deliveroo, Uber and City Sprint have been in the spotlight recently in publicised cases launched by employees with concerns over their status as a self-employed worker, and what the expected duties of this should involve.

Each of these businesses has lost at tribunal, resulting in Deliveroo having to pay all self-employed staff the minimum wage, City Sprint needing to pay self-employed workers holiday pay, and Uber no longer being able to class workers as self-employed at all.

Lord Justice Underhill, a Court of Appeal Judge at the Pimlico ruling, believes employers should not accept the result as an indication of forthcoming legislation for the gig economy: “They should be careful about trying to draw any very general conclusions from it” he said.

A team of legal experts has been commissioned by government officials to determine a fair criteria for the expectation of gig economy workers. The investigation will be led by Mathew Taylor, the chief executive of the Royal Society for the Arts.

Issues for the team of analysis will include issues of pay during periods of holiday, sickness and maternity leave, and issues of pension employment and job security. The findings are due for publication later this year.

Landmark Employment Rights Win for Bicycle Courier

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In a case that could have a considerable impact upon the UK gig economy, a London tribunal ruled that Maggie Dewhurst, who works as a courier at the logistics firm City Sprint, should be granted the same rights as other workers despite her status as a self-employed worker.

To receive the same treatment as a fully employed worker gives Ms Dewhurst certain employment rights otherwise denied to self-employed staff, such as sick pay, holiday and and the right to UK national living wage.

The tribunal decision largely relates to a complaint Ms Dewhurst made in regard to pay issues. A statement issued by the tribunal acknowledged that City Sprint “unlawfully failed to pay her for two days’ holiday”, despite the two years of dedicated service she gave to the company.

Reacting to the ruling, City Sprint expressed “disappointment” and will now be reviewing options for an appeal. A spokesman for the business commented:

“This case has demonstrated that there is still widespread confusion regarding this area of law, which is why we are calling on the government to provide better support and help for businesses across the UK who could be similarly affected.”

This individual case could have a large impact upon all companies that are part of the so-called gig economy. This is an area of customer focused UK employment that consists of companies hiring self-employed workers using contracts that limit their employment rights so that they are given working without regular shift patterns unlike full-time workers.

A recent tribunal ruling much like the City Sprint case involves another popular courier business; the taxi-hailing app Uber. This hearing saw legal action being taken by Uber employees and resulted in the business having to provide self-employed drivers with the same benefits that ordinary workers benefit from.

Although Uber intends to appeal this ruling, there are several other tribunal cases currently being heard against other courier businesses relating to claims of unfair treatment against self-employed workers which might also challenge conduct of the gig economy. The other businesses at the centre of these cases include Excel, Addison Lee and E-Courier.

Ms Dewhurst’s case was ruled as one of unfair treatment due to the extent of the workplace expectations placed upon her by City Sprint, which goes far beyond self-employed duties. She stated the following regarding workers of her position:

“we spend all day being told what to do, when to do it and how to do it. We’re under their control. […] that’s why we deserve basic employment rights like the national minimum wage. I’m delighted that the tribunal ruled in our favour as it has set a legal and moral precedent which others can use to make similar claims.”

Some self-employed workers believe flexible working contracts deny them basic employment rights in a job market that leaves them little to no other employment option.

Employers are unsurprisingly less critical of the use of such contracts, which they often defend on the grounds that they are beneficial to workers due to the flexible working hours offered, which in can potentially let workers conveniently balance personal responsibilities with work.

Many workers and employers both feel that current employment laws need to be edited so that all contracts make clear the law for self-employed workers, thus protecting everyone in a manner that is clear for both parties.

The UK government is currently awaiting the results of an independent review into the modern practices of self-employed workers. It is due for publication in spring 2017.