An independent review into employment practices in the UK has called for work to be “fair and decent”.
The much awaited Taylor Review which has placed changing employment models under the spotlight, has been conducted by Mathew Taylor, head of leading think tank the Royal Society of Arts.
Key to the review has been an exploration of how workers’ rights should be protected, while maintaining the flexibility of modern working practices.
The 115 page report comes after a number of tribunals were launched by so-called ‘gig economy’ workers, who claimed that while technically self-employed workers they were treated more like employees by the businesses they worked for and should therefore benefit from the same sick pay, holiday pay and minimum wage rights as full employees.
The review, which was launched last year to look into ‘exploitative’ practices, recommends that firms which currently closely supervise and direct their self-employed workers should pay a range of benefits, including National Insurance Contributions.
In order to do this, the report says that a new class of workers called Dependant Contractors be created and that they be afforded greater protection, including sick pay and holiday pay.
Taylor has called for the creation of a new minimum wage scheme for these workers, overseen by the Low Pay Commission, which would see their wages calculated by the number of ‘gigs’ they conducted, similar to how ‘piece work’ is administered in some rural sectors.
The report states: “The best way to achieve better work is not national regulation but responsible corporate governance, good management and strong employment relations within the organisation.”
The report also includes recommendations on reducing non-wage costs associated with employment, a strengthening of the National Living Wage and a national strategy to ensure ‘good work for all’.
Taylor also recommended the phasing out of cash-in hand employment and a move towards online platforms to pay for more casual work.
Following the release of the proposals, the Prime Minister Theresa May said the Government would consider the report carefully to see what elements could be enshrined in law and said that with the support of Parliament she would attempt to implement some of the recommendations.
Lara Murray, an Associate Solicitor and employment law expert with Palmer said: “One of the main tenets of the report is the ‘Dependent Contractor’ proposal.
“This new category of worker aims to clear up the confusion some employers face between a fully employed and a self-employed person and will afford ‘contractors’ some basic rights to sick pay and holiday leave, as well as minimum wage requirements that they currently do not enjoy.
“In recent years the number of companies using new models of employment has increased from the building industry to retail to taxis and food deliveries. The growth of the ‘gig economy’ has been tremendous and there are now thought to be around 1.1 million people involved in the sector in the UK.
“The ambiguous status of these self-employed workers has led to a number of employment tribunal claims being made, as workers try to establish their position and rights. This has created confusion and uncertainty for businesses.
“A new class of worker could potentially offer employers and those they employ the best of both worlds, by allowing flexibility while offering greater protection.”
Lara added: “Although these are only proposals at the moment it is widely expected that they will be implemented in some form or another. The devil will be in the detail of any new laws passed by the Government.”
For advice and support on all aspects of employment law, including how the Taylor Review may impact on your business, please contact us.
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