Couriers who deliver parcels for Marks & Spencer, River Island and John Lewis face being charged £150 a day if they cannot find cover when they are ill.
Drivers for the multinational company DPD, which also makes home deliveries for Amazon and Asos, told the Guardian the contractual threat meant they sometimes forced themselves to work when sick.
One driver in the east of England said his manager charged him £150 last year when he couldn’t work because of an upset stomach.
“I said I couldn’t come in because I was too sick and it wouldn’t have been safe for me to drive,” said the driver, who did not wish to be named. “He said: ‘Sorry, I have to charge you.’”
DPD uses about 5,000 couriers in the UK, many of whom are self-employed and are only paid when they work. It made more than £100m in profit in 2015, according to its latest accounts, amid rapidly rising demand for online shopping.
Earnings lost from missing a day’s deliveries were compounded if couriers could not arrange cover and DPD levied “liquidated damages”. When that happened a courier, who typically earns £200 a day, not only lost their pay but another £150, taking their total loss to £350.
Frank Field, who chairs of the Commons work and pensions committee, said the arrangement was appalling.
Drivers said the charges seemed to be applied inconsistently, at managers’ discretion, and that they represented a constant threat.
A spokesman for DPD, which is part of the international parcel group GeoPost, which has a turnover of £5bn, defended its right to recover costs if couriers missed rounds.
“DPD franchisee drivers are not fined for being off work sick,” he said. “Franchisees are contracted to provide a service – if they are unable to provide that service themselves they are required to provide a substitute driver. 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.”
A courier’s contract shown to the Guardian states: “If the franchisee fails to ensure that the service vehicle, the service equipment and the driver are available to perform the services when requested by GeoPost the franchisee shall at GeoPost’s option pay ... for any loss sustained by GeoPost the sum of £150 per day or £75 for any part of a day.”
There is growing concern at Westminster that workers in the gig economy are missing out on important protections, including the minimum wage, sick pay and holiday pay.
On Friday, the Office for National Statistics revealed that the number of people on zero-hours contracts had hit a record high. The number of employees without any guaranteed hours grew by 13% last year to hit 910,000.
“The gig economy is producing wave after wave of evidence on the grim reality of life at the bottom of Britain’s labour market,” said Field, whose committee is holding a parliamentary inquiry into the gig economy. “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 … This move [by DPD] makes the rest of the gig economy look as though it operates in the Garden of Eden.”
DPD couriers deliver 1.6m parcels a week in Britain. It stresses that its drivers are relatively well-paid and claimed that, after 12 months’ service, they earned an annual average of £37,000 after costs.
The practice of sometimes charging drivers who could not find cover for missed shifts is believed to have been in operation for several years. DPD said that when it established the franchisee scheme it “obtained clearance from HM Revenue & Customs to ensure that franchisees were genuinely self-employed and that the scheme was fully compliant with relevant legislation and good practice”.
It said it had since received HMRC clearance over further changes to the arrangements. “These drivers own their own franchise and run their own businesses,” the spokesman said. “It isn’t a ‘lifestyle’ option, and the scheme differs from that run by a number of other companies.”
However, one courier said DPD’s compulsory training, its use of a rota which is emailed regularly to drivers, a uniform, and the requirement to use DPD’s handheld computers meant “it is not real self-employment, it is employment”.
Another claimed: “We have to adhere to the same procedures as employed people. The only difference is that we don’t get any holiday pay or sick pay and we have no rights at all.”
River Island and John Lewis declined to comment. A spokesperson for M&S said: “It’s not appropriate for us to comment on the specific detail of DPD’s contracts.” Asos and Amazon did not respond to inquiries.
For other companies that use large self-employed workforces, the question of whether they are genuinely being self-employed is being tested through the courts.
This week the ride-hailing app Uber was granted the right to appeal against an employment tribunal ruling that its drivers were not self-employed, but were workers. If upheld, it will mean Uber must pay the minimum wage, sick pay and holiday pay.
Rob Booth, The Guardian