NSW courier contractors win pay rise

The Transport Workers' Union had claimed multinational logistics giants have been classifying such workers as independent contractors to avoid giving them fair pay and conditions.

The commission's decision closes that loophole, they say, giving many of these drivers their first increase in rates for more than 15 years, TWU NSW secretary Richard Olsen said.

"It is shameful that could occur, but it has, and today we have succeeded in the NSW (Industrial Relations) Commission in putting forward a plan for the next three years moving those rates by more than 40 per cent," Mr Olsen said.

Rates will rise over three years, beginning in March.

Drivers with vans that have a load capacity between 1.5 and three tonnes will be entitled to $43.74 an hour at the end of the phased pay increases.

At the other end of the scale, drivers who use their own cars to deliver packages for services such as Amazon Flex will eventually be entitled to $37.80 per hour.

Mr Olsen said the pay rise will go towards helping independent contractor drivers recoup extra costs including insurance, maintenance and fuel.

Amazon Flex driver Jatinderpal Singh said he hopes the decision will ensure the company's workers can keep up with the costs of running their business.

However, in a statement a spokeswoman for Amazon said its Flex drivers already earn competitive pay, with the added benefit of the flexibility to work when it suits them.

"Amazon Flex delivery partners in NSW driving a sedan earn an average of over $128 for a four-hour block which already exceeds the new rate that will come into effect from 1 March."

However once the full pay increase is phased in, drivers would be entitled to a minimum of $151 for four hours of work.

Former courier Chris Turner said his experience in the industry showed the independent contractor model "just does not work".

"You have to set up as a company but you get paid like an employee," he said.

"You're basically going to be set up for financial and emotional disaster."

He said he's watched couriers signing bankruptcy forms, seen others have their vans repossessed by creditors, and previously lived in his van "to keep my head afloat".

The TWU wants the federal government to legislate similar pay requirements at a national level.