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You can find the current article at its original source at https://www.theguardian.com/society/2016/jul/19/hermes-couriers-low-pay-national-living-wage-self-employed
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| PM urged to launch inquiry into low pay of self-employed couriers | PM urged to launch inquiry into low pay of self-employed couriers |
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| The prime minister has been urged to open an investigation into the growing use of self-employed workers after the Guardian found some couriers contracted to Hermes were struggling to earn the national living wage. | The prime minister has been urged to open an investigation into the growing use of self-employed workers after the Guardian found some couriers contracted to Hermes were struggling to earn the national living wage. |
| Frank Field MP, chairman of the powerful House of Commons work and pensions select committee, said the government should review HM Revenue and Customs (HMRC) criteria that allow companies to contract work to self-employed individuals rather than hire them as employees. | Frank Field MP, chairman of the powerful House of Commons work and pensions select committee, said the government should review HM Revenue and Customs (HMRC) criteria that allow companies to contract work to self-employed individuals rather than hire them as employees. |
| Related: Revealed: delivery giant Hermes pays some couriers less than living wage | Related: Revealed: delivery giant Hermes pays some couriers less than living wage |
| Referring to Theresa May’s first speech as prime minister, in which she said she would legislate for “families who are just managing” and people who “have a job but … don’t always have job security”, Field said: “Given what the prime minister said about the nature of her administration, I would hope that she would now ask the HMRC to review whether their criteria are adequate.” | Referring to Theresa May’s first speech as prime minister, in which she said she would legislate for “families who are just managing” and people who “have a job but … don’t always have job security”, Field said: “Given what the prime minister said about the nature of her administration, I would hope that she would now ask the HMRC to review whether their criteria are adequate.” |
| “This is a really good chance for [May] to start this new approach. This [issue with self-employment] is undermining government policy which is to raise wages at the bottom.” | “This is a really good chance for [May] to start this new approach. This [issue with self-employment] is undermining government policy which is to raise wages at the bottom.” |
| The Guardian obtained information about the earnings, hours and expenses of couriers for Hermes, which delivers parcels for retailers including John Lewis, that indicated some were earning below the national living wage of £7.20 per hour for people aged 25 and over. However, because the couriers are self-employed and not covered by the national living wage, the arrangement is legal. | The Guardian obtained information about the earnings, hours and expenses of couriers for Hermes, which delivers parcels for retailers including John Lewis, that indicated some were earning below the national living wage of £7.20 per hour for people aged 25 and over. However, because the couriers are self-employed and not covered by the national living wage, the arrangement is legal. |
| The general secretary of the TUC, Frances O’Grady, has also called for reform. “This isn’t just one company,” she said. “The rise of bogus self-employment is hitting people’s incomes and job security across the country.” | The general secretary of the TUC, Frances O’Grady, has also called for reform. “This isn’t just one company,” she said. “The rise of bogus self-employment is hitting people’s incomes and job security across the country.” |
| “Common sense would tell you that these people deserve the pay and security of regular employees. The law should be reformed to ensure that people working in these conditions get the rights they deserve. This is the kind of working practice we want to see shrinking, not growing.” | “Common sense would tell you that these people deserve the pay and security of regular employees. The law should be reformed to ensure that people working in these conditions get the rights they deserve. This is the kind of working practice we want to see shrinking, not growing.” |
| Hermes has said that it is “committed to ensuring that our couriers receive earnings that are equivalent to or higher than the national living wage”. It said it monitors estimated rates per hour and restructures rounds or increases rates if they fall below £7.20 per hour. It said that according to its calculations, none of its couriers earn below that level and on average earn £9.80 per hour after expenses. | Hermes has said that it is “committed to ensuring that our couriers receive earnings that are equivalent to or higher than the national living wage”. It said it monitors estimated rates per hour and restructures rounds or increases rates if they fall below £7.20 per hour. It said that according to its calculations, none of its couriers earn below that level and on average earn £9.80 per hour after expenses. |
| Self-employed workers are used across the economy by delivery companies, largely serving the booming internet shopping market. They include the taxi app company Uber, which has 30,000 self-employed drivers in London alone. Self-employed workers do not receive sick pay, holiday pay or employer-funded pensions, but enjoy greater flexibility over when and how they work. | Self-employed workers are used across the economy by delivery companies, largely serving the booming internet shopping market. They include the taxi app company Uber, which has 30,000 self-employed drivers in London alone. Self-employed workers do not receive sick pay, holiday pay or employer-funded pensions, but enjoy greater flexibility over when and how they work. |
| The UK’s self-employed workforce has grown by 800,000 to 4.7 million since 2008, according to official figures. The HMRC provides a 14-point checklist to help decide if someone is an employee or self-employed. | The UK’s self-employed workforce has grown by 800,000 to 4.7 million since 2008, according to official figures. The HMRC provides a 14-point checklist to help decide if someone is an employee or self-employed. |
| Related: Life as a Hermes driver: 'They offload all the risk on to the courier' | Related: Life as a Hermes driver: 'They offload all the risk on to the courier' |
| Questions include: whether the business provides the materials, tools and equipment for their work; whether they only work for the business, or if they have another job, it is completely different from their work for the business; and if a manager or supervisor is responsible for their workload, saying when a piece of work should be finished and how it should be done. | Questions include: whether the business provides the materials, tools and equipment for their work; whether they only work for the business, or if they have another job, it is completely different from their work for the business; and if a manager or supervisor is responsible for their workload, saying when a piece of work should be finished and how it should be done. |
| Hermes says its couriers are free to plan their rounds around their personal circumstances and are free to negotiate their own rates, rounds and number of days they work. | |
| The political pressure for a rethink of HMRC’s rules comes as figures show as many as two-thirds of self-employed workers in the transport sector, which includes couriers, delivery drivers and Uber taxi drivers, now earn below the national living wage. | The political pressure for a rethink of HMRC’s rules comes as figures show as many as two-thirds of self-employed workers in the transport sector, which includes couriers, delivery drivers and Uber taxi drivers, now earn below the national living wage. |
| The finding comes from the Social Market Foundation (SMF) thinktank, which assessed detailed information for 1,600 transport sector workers from the 2013-14 Family Resources Survey and extrapolated for earnings growth. | The finding comes from the Social Market Foundation (SMF) thinktank, which assessed detailed information for 1,600 transport sector workers from the 2013-14 Family Resources Survey and extrapolated for earnings growth. |
| “The government has focused its efforts on tackling low pay among employees, in particular by introducing the national living wage,” said Nida Broughton, chief economist at the SMF. | “The government has focused its efforts on tackling low pay among employees, in particular by introducing the national living wage,” said Nida Broughton, chief economist at the SMF. |
| Related: How Hermes couriers shoulder insecurity of internet shopping boom | Related: How Hermes couriers shoulder insecurity of internet shopping boom |
| “But in doing so, it is further sharpening the divide between employee and self-employed. Policies such as the [national living wage] risk making it artificially more attractive for firms to engage contractors rather than employees, and ignore a large section of low-paid workers. The government needs to adapt to a world that is moving away from the traditional employer-employee model of working, and look at how the low-paid self-employed can be supported into higher-paid work.” | “But in doing so, it is further sharpening the divide between employee and self-employed. Policies such as the [national living wage] risk making it artificially more attractive for firms to engage contractors rather than employees, and ignore a large section of low-paid workers. The government needs to adapt to a world that is moving away from the traditional employer-employee model of working, and look at how the low-paid self-employed can be supported into higher-paid work.” |
| Ray Ellis, acting deputy general secretary of the Communication Workers Union, which represents some couriers, said: “We desperately need intervention which rebalances the power of companies and workers in this ‘gig economy’. These delivery workers are employees in everything but name.” | Ray Ellis, acting deputy general secretary of the Communication Workers Union, which represents some couriers, said: “We desperately need intervention which rebalances the power of companies and workers in this ‘gig economy’. These delivery workers are employees in everything but name.” |
| Hermes said it uses “internal and external tax and employment specialists to ensure that the services that our couriers perform for Hermes, and the way that these services are monitored by Hermes, is consistent with self-employment at all times”. | Hermes said it uses “internal and external tax and employment specialists to ensure that the services that our couriers perform for Hermes, and the way that these services are monitored by Hermes, is consistent with self-employment at all times”. |