The Taylor Review of Modern Work Practices (also known as the Good Work Report) was published this week.
The report, spanning 116 pages, provides an in depth review of the current state of the UK Labour Market and sets out reforms suggested by the author and researchers, Matthew Taylor, Greg Marsh, Diane Nicol, and Paul Broadbent.
The Government requested this review based on a single overriding ambition:
All work in the UK economy should be fair and decent with realistic scope for development and fulfilment.
Here are three key suggestions made by the report which could have considerable effects on UK employment law.
Employment Status Legislation
The report concludes that employment status and its subsequent frameworks are too confusing for the everyday person to decipher without the help of the courts. They have proposed a clear set of legislation be drafted to help employees and employers to easily establish employment status’ and the employment rights that are associated with them.
Taylor’s review states,
“…the rights of individuals under each status are difficult to understand…[meaning individuals]could be missing out on key rights, such as holiday pay.”
It has also been highlighted that many employees and employers believe that someone’s employment status is based on the words stated in their employment contract (if they are given one). However, employment status is actually established through meeting a certain criteria, so while your employment contract may give you one employment status, a court may decide that you actually hold another.
The severity of this ambiguity is summed up very well by the Law Society in their submission to the review,
“Determining whether you are an employee, a worker or genuinely self-employed requires the ability to understand complex legislation, which is spread over many Acts, and be aware of a mountain of case law. For individuals, not knowing your employment status means not knowing what employment rights you deserve. For businesses, this situation can lead to uncertainty about their responsibilities and what can be demanded from workers. The situation does not need to be this complicated.”
The Future of “Workers” and the Gig Economy
Recent cases have shown the ease and frequency of exploitation of workers in the gig economy. Companies such as Uber, Deliveroo and Sports Direct have been involved in major court cases to reveal the extent of the general lack of understanding of the rights of those who work on a flexible basis.
In order to distinguish between employees and workers (since a worker can be found to be an employee but an employee can never be a worker), the review has suggested now naming Workers as Dependent Contractors instead.
Taylor has recommended that the opportunity for people to work hours that suit them continue, however the government should work to allow greater protection to workers without removing the flexibility of their work. He speculates that the success of the current Labour Market may be down to the fact that more women and older people are getting into employment due to the flexibility offered by this type of work. For this reason, the review is keen to persuade the Government to allow this kind of working to continue. On the other hand, they were concerned that the current pay practices for workers left many with uncertain incomes leading to those people struggling to get approval for mortgages and even phone contracts.
Baseline of Protection for All
The review makes one recommendation that covers all, regardless of employment status; everyone should have a “baseline of protection”. The three tier approach (employed, self-employed and worker/dependent contractor) must be retained but minimum rights for each tier should be put in place and adhered to. The balance of power between employer and employee should be redressed to ensure ‘good work’ for all. There should be a fair balance of rights and responsibilities to benefit both the worker and the employer equally.
Taylor has suggested tougher penalties for businesses found to be exploiting workers’ rights but has also suggested incentives for businesses that provide good work places, which are fair and open with their practices.
This report is just offering suggestions to the Government based on their extensive research so there is no guarantee any of them will become law however it is important for business owners and employees to keep their eye on any further developments.
Farleys employment law solicitors can help your business by advising on forthcoming changes to employment law; advising on your businesses legal position, options, processes, tactics and strategy together with a wide range of HR and employment law matters. Contact Farleys Commercial HR & Employment law team on 0845 287 0939 or email us here.
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