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No ‘Taylor’-made employment law changes on the horizon

03 April 2018

July 2017 saw the release of the much anticipated ‘Taylor Review of Modern Working Practices’, otherwise known by its catchier name, the ‘Good Work Report’. It paid particular attention to the gig economy and looked at not only how people are engaged in work, but also the quality of the work arrangement.

The Good Work Report also endorsed the present system of employment status which distinguishes between employee, worker and self-employed. It recommended that the category of ‘worker’ (currently used to categorise individuals in less formal employment relationships) be renamed ‘dependent contractor’, and suggested that those in this group receive at least basic employment rights, alongside a statement of employment on commencement of work.

The report also noted that ‘too many’ employers rely on zero- hours contracts, short-hours or agency contracts; a higher rate of national minimum wage should be considered for hours not guaranteed by the individual’s contract, and that a right should be introduced to request a ‘guaranteed hours contract’ when an individual has been under a zero-hours contract for 12 months.

The government has now responded to the Good Work Report.

Those expecting a big shake-up in employment legislation will be thoroughly disappointed. Whilst the government has not ignored the recommendations of the report, it has not committed to actually implementing the recommendations. Instead, four consultations have been launched, seeking views on certain aspects of the report, namely:

  • employment status – considering the proposals on the definitions of employee and worker
  • employment rights recommendations – looking at the problem of unpaid tribunal awards and repeat offenders
  • protecting agency workers – the proposal to amend the Agency Workers’ Regulations that allow agencies which directly employ the workers they supply to avoid having to match the pay of the end user in certain circumstances
  • increased transparency – addressing the proposals on written statements of terms and conditions, holiday pay, continuity of employment etc.

Whilst this may seem like a step in the right direction, the government has not made any proposals of its own; rather, it is simply asking for opinions on the recommendations of the Good Work Report. Very little progress has been made since July 2017.

The government’s press release did confirm that it will “seek to protect workers’ rights” by (not an exhaustive list):

  • taking further action to ensure unpaid interns are not doing the job of a worker
  • introducing a new naming scheme for employers who fail to pay employment tribunal awards
  • quadrupling employment tribunal fines for employers showing malice, spite or gross oversight to £20,000 and considering increasing penalties for employers who have previously lost similar cases
  • providing all 1.2 million agency workers with a clear breakdown of who pays them and any costs or charges deducted from their wages
  • asking the Low Pay Commission to consider the impact  of higher minimum wage rates for workers on zero-hours contracts
  • considering repealing laws allowing agencies to employ workers on cheaper rates.

However, the reality is that there are no actual proposals for new legislation on any of the above, and whilst the government may have the best of intentions, an overhaul of employment legislation is unlikely to happen in the foreseeable future.

Matthew heads up our Legal 500-rated employment team. He handles the full range of contentious and non-contentious employment law issues for a client base which includes multi-national companies, owner-managed businesses and not-for-profit organisations. His particular specialisms include complex staff restructurings and employment issues concerning business transfers. He is a member of the Employment Lawyers’ Association, and a GL Ambassador for GFirst LEP. 

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Matthew Clayton MA LLM (Cantab), CIPP/E
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