UK: The gig economy – a new report and draft Bill

The Taylor Review, published in July, listed a number of proposals for reform on employment status and workers’ rights. The Work and Pensions Committee and the Business, Energy and Industrial Strategy Committee have now published a report ‘A framework for modern employment’ and have prepared a draft Bill which aims to take forward “the best” of the recommendations in the Taylor Review.

The key recommendations in the Committees’ report include:

• There should be simpler, clearer statutory definitions of employment status to protect workers and reduce the need to go to tribunal. In distinguishing between workers and the self-employed, the legislation should emphasise the importance of control and the supervision of workers by a business.

• The intention appears to be that the worker by default model (i.e. if the issue of employment status arises in a tribunal claim, the assumption will be that they are a worker, unless the business can establish they are self-employed) should apply to companies that have a self-employed workforce over a certain size. However, no indication is given as to what that number, or what proportion of the workforce, that would be.

• Businesses should have to provide a clear written statement of particulars for workers on their rights and entitlements within seven days of the start of their engagement.

• Companies that benefit from a flexible workforce should either guarantee hours that reflect the periods worked each week or compensate zero hours contracts workers for uncertainty – with a pay premium on the National Minimum Wage or the National Living Wage.

• The ‘Swedish derogation’ model should be abolished – this allows agency workers to opt out of equal pay with permanent employees of the end user and instead receive a minimum level of pay between assignments.

• Both employees and workers should be counted towards the 50 workers requirement for companies to be covered by the workplace consultation regulations, and the threshold for establishing workplace representatives should be reduced from 10% to 2% of the workforce making the request.

It remains to be seen whether the Committees will be allowed legislative time to take through a Bill with Government support. However, it may well be that those changes that can be made easily through secondary legislation, like the agency workers ‘Swedish derogation’ and the workplace consultation reforms, will be introduced soon.

For more information on these articles or any other issues involving labour and employment matters in United Kingdom, please contact Robert Hill, Partner at Clyde & Co (www.clydeco.com) at robert.hill@clydeco.com
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