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David Ellesmere: City Link collapse illustrates failings of Tory economic policy

The closure of the City Link delivery company before Christmas illustrated a number of problems with the state of Britain today, says Labour's Parliamentary Candidate for Ipswich, David Ellesmere.


There was the shoddy way the owners behaved, taking orders until the last minute and pretending there was nothing wrong. Customers placed orders which the owners knew would not be delivered. Employees - told that everything was ok - carried on working with the owners knowing they wouldnt get paid.

The venture capital owners meanwhile had secured their own position to ensure they at least would get their money back.

However, one of the biggest spotlights was thrown on the so-called self-employed drivers of City Link.

As the economy has started growing and unemployment has reduced, the number of self-employedpeople has shot up. Around 4.6 million people are now classified as self-employed in the UK. At 15% of the workforce, this is the highest proportion for 40 years.

When most people think of someone who is self-employed they imagine perhaps the owner of a small shop, a plumber or an electrician. The sort of jobs where if you work hard and do a good job then you can earn reasonable money. It can be risky, but there is a sense of freedom from being your own boss.

Sadly, this is a rose-tinted view of what self-employment means to many people in Britain today. An increasing number of self-employed people are not their own bosses. Instead they are providing work for only one firm. To all intents and purposes they are employees of this firm but they are forced to be self-employedso the company avoids paying any tax and giving them employment rights.

This was the situation with many of the City Link drivers. They only worked for City Link. Their vans were painted with the City Link logo and colours. To get work anywhere else, they will first have to pay to re-spray their vans.

They were paid a fixed price per delivery whether it contained one item or twenty. If they were sick, they didnt get sick pay. They were fined.

If they wanted to go on holiday they had to arrange - and pay for - someone to cover for them.

The lack of maternity pay meant that women were all but excluded from the job.

They werent eligible for redundancy pay. They had to invoice City Link and were paid in arrears, so many of the drivers were left being owed thousands of pounds. Its unlikely that they will ever see this money.

Imagine trying to get a mortgage on earnings as insecure as this.

There has been a lot of attention paid to how zero hours contracts are being used to weaken workersjob security and employment rights. Self-employment is increasingly being used to weaken them even further.

I met one self-employed taxi driver in Ipswich who said he dreamed of being on a zero hours contract because it would give him better security than he had now.

This race to the bottom is depressing wages for ordinary workers and is a major contributor to the Cost of Living Crisis, which has cost the average family £1,600 a year since 2010.

This is only going to continue with the current Government in charge. They want to weaken workersrights even further.

The race to the bottom and the Cost of Living Crisis will not be solved by the Conservatives’“long term economic plan.

They are the Conservativeslong term economic plan.

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