Elizabeth Selby’s presentation at The Logistics Point’s Urban Logistics & Last Mile Event in London shed light on the intricate landscape of drivers’ rights in the gig economy, particularly within the logistics sector.
The core theme explored was the adaptability of a flexible workforce, allowing companies to adjust their supply according to fluctuating demand. However, Elizabeth highlighted a gradual but significant shift wherein workers in the gig economy have been granted increased employment rights, more akin to those of traditional employees. This evolution has prompted many last mile businesses to re-evaluate their operational models.
One of the key challenges addressed was the ambiguity surrounding the classification of drivers as either employees, workers or self-employed individuals. Elizabeth emphasised that, while there isn’t a definitive checklist to distinguish between the three, courts typically consider various factors, including the widely discussed right of genuine substitution.
Elizabeth also flagged the tax issues surrounding employment status, noting that HMRC doesn’t recognise worker status, meaning that – from a tax perspective – drivers will be either employed or self-employed. She advised seeking legal and accounting advice to navigate this intricate terrain effectively.
Crucially, Elizabeth underscored the importance of ensuring compliance to avoid potential investigations from HMRC. Imposing restrictions on individuals labelled as self-employed while controlling their work processes can trigger HMRC scrutiny, leading to investigations and penalties.
Drawing from real-world examples, Elizabeth highlighted the costly and time-consuming nature of employment tribunal cases, exemplified by the lengthy disputes involving Uber and – more recently -Deliveroo, both of which incurred significant expense and caused substantial operational distraction.
The presentation emphasised the significance of reputation management, especially concerning client and consumer relationships. Despite legal shifts favouring increased worker rights, the self-employed model remains popular in the final mile businesses.
Fact-checking all is best
To navigate this complex landscape effectively, Elizabeth recommended a diligent approach. Using the facts to determine status was highlighted as pivotal. Ensuring contracts align with operational practices and being mindful of seemingly minor details, such as company-branded attire, that can significantly impact employment status. Regular internal reviews were also recommended as a risk-mitigation tool.
Lastly, maintaining transparent communication with drivers and engaging with trade unions were proposed as crucial strategies to foster a harmonious and compliant work environment in the gig economy.
