The New South Wales (NSW) Industrial Relations Commission (IRC) in Australia has ruled that a minimum wage rate must be set for delivery drivers in the state.

The decision comes after an industry-wide consultation led by the Transport Workers’ Union (TWU) and other stakeholders, including ARTIO, Ai Group, the NSW Business Chamber, FedEx, Global Express and Toll.

From next month, courier van drivers whose vehicles have carrying capacities of 1.5t and 3t will receive A$43.74 ($31.58) an hour.

Amazon Flex drivers and other couriers in the state will be entitled to an enforceable rate of A$37.80 an hour by 2025.

TWU NSW/QLD Secretary Richard Olsen said: “The minimum pay rate for a courier using their own van was set at $28 almost 15 years ago.

“Since then, their operating costs have skyrocketed but their pay hasn’t changed, leaving some drivers earning below minimum wage after costs.

“Today’s decision will be a welcome relief to those drivers – an increase of more than 40% over the next three years, to finally catch them up to where they should be after 15 years of stagnant pay.

“This decision is a massive victory for the thousands of couriers who have been part of the TWU’s Fight for 40 campaigns over many years.”

Prior to this regulation, rates of pay for contracted owner-drivers in NSW were generally governed by the General Carriers Contract Determination.

The contract did not set enforceable rates for vehicles carrying capacities of less than 2t.

With this decision, NSW has become the first jurisdiction in the world to mandate enforceable rates for Amazon Flex drivers.

Drivers under the Amazon Flex programme are categorised as independent contractors and can use their personal vehicles to deliver goods and groceries.

Last February, the US Federal Trade Commission and Amazon reached a settlement worth more than $61.7m for mishandling customers’ tips to Flex drivers.