See our blog on the Matthew Taylor Report on workers rights
The Matthew Taylor Review
If you have been keeping up to date with the ongoing ‘worker status’ saga in the news this year, you will know that companies such as Deliveroo, Uber, CitySprint and Pimlico Plumbers have been forced to turn to the tribunal to decide whether or not the individuals they employ are self-employed or whether they would be classed as workers. This distinction is important as workers benefit from employment rights such as sick pay, holiday pay, rest breaks and the National Minimum wage, whereas self-employed individuals do not.
Employee status has often proved to be a grey area of the law, but the rise of the ‘gig economy’ has caused a whole new breed of worker to emerge, forcing employers to reconsider their business models.
This ongoing ambiguity has now been addressed in a review called ‘Good Work: the Taylor Review of Modern Working Practices’, which revealed its findings and suggested guidance this week. This review was announced at the end of 2016 – in order to provide the Government with recommendations for much needed legislative reform in this area.
In particular, the review has highlighted the need for legislation to move with the fast pace of change in the economy, especially in relation to gig economy workers. There are an estimated 1.1 million people working in the gig economy and, while this style of work does provide individuals with a great deal of flexibility in theory, in reality, employers are being permitted to utilise the lack of security these contracts provide to their advantage. This is especially the case when it comes to more basic rights such as holiday and sick pay.
Some of the main recommendations of the review are as follows:
- There should be a new classification of employment status called ‘dependent contractors’, which would likely apply specifically to those working for platform-based companies such as Uber and Deliveroo. This would replace the term ‘worker’ and enable these individuals to benefit from additional employment rights, such as holiday pay and sick pay.
- Individuals who want to challenge their employment status in the tribunal should not be obliged to pay tribunal fees and the burden of proof should be moved on to the employer.
- Statutory Sick Pay (SSP) should become a basic right like the National Minimum Wage.
- The Government should seek to freeze or reduce the costs of employing individuals, over and above the costs of their wage. For example, in relation to the apprenticeship levy.
- Workplace health needs to be made a greater priority, as this will have a lasting benefit for companies.
- The ‘Swedish Derogation’ loophole should be abolished, which would mean that employers would no longer be able to pay agency workers less than permanent staff for performing the same role.
Theresa May has stated that the Government will take these recommendations seriously; however, trade unions have indicated that the findings of the review do not go far enough in addressing the exploitation suffered by many individuals.
While the recommendations seem like good news for those working in uncertain and insecure employment arrangements, whether these guidelines will have any significant impact in the future is yet to be seen.
The full review can be found here: https://www.gov.uk/government/publications/good-work-the-taylor-review-of-modern-working-practices .
Sanya Masood , Associate Solicitor