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Taylor Review: Leaked report suggests radical reform for modern working practices

The Taylor Review was commissioned to consider how modern employment practices need to change in order to keep pace with modern business models. The Times has received a leaked draft of the Review and the headlines reveal raising taxes from self-employment and improved rights for those working in the gig economy.

Background

The gig economy has certainly grown in momentum in recent years with companies like Deliveroo and Uber basing their business model on a flexible workforce. With this rapid increase in a new category of worker it is unsurprising that questions relating to employment rights and worker protection need addressing.  The Taylor Review was launched in November 2016 with its key focus to consider the rights and responsibilities of workers as well as employer freedoms and obligations.  Matthew Taylor (former head of policy for Tony Blair) has spent the last eight months gathering information from employers and the workforce about the UK’s labour market.

The Times – leaked report

The Taylor Review is due to issue its report this week and a 96 page draft copy of the report has been leaked. The following are the key recommendations and findings reported by the Times:

  • There should be a new category of contractors who are eligible for workers’ rights but are not employees.
  • The category of contractors should be referred to as ‘dependent contractors’ and some at least should receive minimum wage protection.
  • The draft report states “the same basic principles should apply to all forms of employment — there should be a fair balance of rights and responsibilities, everyone should have a baseline of protection and there should be routes to enable progression at work.”
  • The report says: “Dependent contractors are the group most likely to suffer from unfair one-sided flexibility and therefore we need to provide additional protections for this group and stronger incentives for firms to treat them fairly.”
  • Although there is no suggestion of a ban on zero hours contractors, further regulation seems likely with the report stating: “We believe that too many employers and businesses are relying on zero-hours, short-hours or agency contracts when they could be much more forward-thinking in their scheduling.”
  • Workers need certainty of hours and income and businesses need to be reasonable with regard to their demand on flexibility. Workers need to be able to make plans around their work and receive compensation if arrangements change at short notice.
  • More must be done to equalise taxes between the employed and self-employed. However, it is questionable how far this will be taken with the backlash which was received following the (now reversed) policy announcement on increased National Insurance Contributions for the self-employed.
  • Finally, with a positive nod towards technology based companies such as Uber and Deliveroo: “Technological change will impact work and types of employment and we need to be able to adapt, but technology can also offer new opportunities for smarter regulation, more flexible entitlements and ways for people to organise.”

Conclusion

With an estimated 4.79 million self-employed people in the UK and over 1 million working within the gig economy the Taylor report is much anticipated. The trend in recent months in the tribunals and courts has certainly been that this so called category of ‘self-employed contractor’ should have worker status and the ensuing rights.  It was perhaps predictable that the Taylor Review would follow suit and ensure greater protection for these workers.  As is often the case the devil will be in the detail and we look forward to receiving the full report.  We will keep you updated.

See our employment status – the barometer hub for a full consideration of all the recent cases, reviews and a table setting out the true impact of employment status. We are also offering an employment status audit where we can assess your workforce and the employment status of the different categories of individuals.

To read a full copy of the Times article please click here

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Legal news, views, trends and tools for HR Professionals. Stay ahead. Go further