An HGV/Lorry Driver Contractor Agreement is a legally binding contract used in England and Wales to formalise a self-employed engagement between a haulage business (the operator) and a self-employed Heavy Goods Vehicle (HGV) driver. Unlike an employment contract, this agreement establishes that the driver is an independent contractor rather than an employee, with important consequences for tax, National Insurance, employment rights, and operational responsibilities.

HGV operations in Great Britain are subject to a complex and highly regulated framework of legislation. The Goods Vehicles (Licensing of Operators) Act 1995 requires haulage operators to hold a valid Operator's Licence (O-licence) issued by the Traffic Commissioner, and sets out the obligations of operators in relation to vehicle maintenance and the fitness of drivers. EC Regulation 561/2006 (as retained in UK law following Brexit) prescribes the maximum permitted daily, weekly, and fortnightly driving times and minimum rest periods that all HGV drivers must observe. The Road Transport (Working Time) Regulations 2005 impose additional working time limits on mobile road transport workers. The Road Transport (Driver Qualification) Regulations 2014 require all professional HGV drivers to hold a valid Driver Certificate of Professional Competence (Driver CPC), renewed every 5 years through 35 hours of periodic training. EU Regulation 165/2014 (as retained in UK law) governs the use of digital tachographs, which must be fitted to most goods vehicles over 3.5 tonnes and used to record driving time, breaks, and rest periods.

From a tax perspective, the IR35 off-payroll working rules contained in the Income Tax (Earnings and Pensions) Act 2003 are critically important. Where the haulier is a medium or large business, it has the responsibility of determining whether the driver would be deemed an employee for tax purposes if engaged directly. A well-drafted HGV Contractor Agreement that reflects the true nature of a self-employed relationship — with a genuine right of substitution, financial risk, and no obligation of personal service — supports an outside-IR35 determination and protects both parties from unexpected HMRC liabilities.

This agreement covers all key aspects of the engagement: the driver's licence, Driver CPC, and tachograph card details; the scope of driving services; compliance with drivers' hours and working time rules; fee structure and payment terms; insurance obligations; substitution rights; confidentiality; and termination provisions.

An HGV/Lorry Driver Contractor Agreement is essential whenever a haulage business in England or Wales engages a self-employed HGV driver on a contract basis rather than hiring them as an employee. This is a common arrangement in the road haulage industry, particularly during periods of peak demand, seasonal fluctuations, or driver shortages, where businesses need flexible access to qualified drivers without the long-term commitment and cost of direct employment.

You should use this agreement whenever you are engaging a self-employed lorry driver to haul goods on a national or international basis; when taking on a driver through a driver agency on a labour-only sub-contracting arrangement; when a driver operates through their own limited company or personal service company (PSC) — in which case IR35 compliance is particularly important; when engaging a specialist driver for abnormal loads, temperature-controlled transport, or hazardous materials haulage; or when a sole trader haulier is taking on a sub-contractor to cover additional work.

The agreement is equally relevant for the driver as for the haulier. Without a written contract, the driver has no documented record of the agreed fee rate, payment terms, notice period, or working arrangements. In the event of a dispute about whether the driver is entitled to employment rights (such as paid holiday under the Working Time Regulations 1998), the absence of a written agreement makes it more difficult to demonstrate the true nature of the relationship.

Given the severe consequences of non-compliance with drivers' hours rules — including criminal prosecution, prohibition notices, and loss of the operator's O-licence — both parties benefit from a written agreement that clearly allocates responsibility for tachograph compliance, vehicle inspections, and licence maintenance between the haulier and the driver contractor.

A comprehensive HGV/Lorry Driver Contractor Agreement for use in England and Wales should address several areas that are specific to the road haulage industry and distinguish it from a standard freelance or contractor agreement.

The employment status and IR35 provisions are foundational. The agreement must clearly state that the driver is engaged as an independent contractor and not as an employee, and should record the outcome of the haulier's IR35 determination where the haulier is a medium or large business. A genuine right of substitution clause — allowing the driver to provide a suitably qualified substitute — is one of the most important indicators of self-employment under English case law, particularly following the Supreme Court's analysis in Uber BV v Aslam [2021] and the Court of Appeal's decision in Pimlico Plumbers Ltd v Smith [2017].

The qualifications and compliance clause should record the driver's DVLA licence number and category, Driver CPC card number and expiry date, and digital tachograph card number. The driver should give a warranty that all licences and qualifications are valid and undertake to notify the haulier immediately of any suspension or revocation.

The drivers' hours compliance clause must reference EC Regulation 561/2006 as retained in UK law and the Road Transport (Working Time) Regulations 2005, and should clearly state the maximum permitted driving times and rest period obligations. The tachograph obligations clause should confirm that the driver must use the digital tachograph correctly throughout each engagement.

The Operator's Licence clause should record the haulier's O-licence number and confirm that the haulier is responsible for maintaining a valid licence throughout the term of the agreement. The insurance clause should specify the minimum levels of public liability insurance the driver must maintain, and confirm the haulier's obligations in respect of fleet motor insurance and (where applicable) goods in transit insurance.

The fee and payment clause should specify the rate (hourly, daily, mileage, or fixed per assignment), payment frequency, and the Late Payment of Commercial Debts (Interest) Act 1998 interest rate applicable to overdue invoices. The termination clause should allow immediate termination if the driver loses their licence, CPC, or tachograph card.