UK parcels market sees growth in employment

Employment trends

Figures from our latest report on the UK parcels market shown in the chart above show a recent increase in the aggregate numbers of staff employed by the 16 leading UK parcels operators. This represents a reversal of the long term trend for the aggregate number of employees to fall year on year.

We believe that this is possibly in response to concerns raised by HMRC and others regarding self-employment models used in the industry. .The main concern has been that some models may have involved misuse of self-employment regulations to obtain tax savings.

The self-employed models have been challenged by groups of drivers, with support from unions like the GMB, arguing in Employment Tribunals that the nature of their work amounts to full employment within the definitions of employment law. A June 2018 Guardian news article reported: “The GMB, which helped bring the claim, said the ruling was likely to affect 14,500 Hermes couriers who are engaged under the same contract as the 65 couriers who took the case to the tribunal.”

Hermes has not been alone in seeing pressure on its staffing model in the UK parcels market. DPD responded to a tragedy among its contractor drivers when one died in part due to skipping hospital visits for his diabetes. The Guardian reported in March, DPD “would offer its 6,000 couriers the right to be classed as either workers, an interim status that includes paid holiday, sick pay and access to a pension scheme with the possibility to still be paid per delivery, as a fully-fledged employee or to remain a self-employed franchisee.”

This, and other issues in the market are explored in our recent report on the industry: UK Parcels Market Insight Report, 2018.