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14th July 2017

Taylor Review of Modern Practices – The Beginning of Employment Law Reform?

On 11th July 2017, the Taylor Review of Modern Practices was published which has outlined its findings and recommendations to the UK’s gig economy.The review - published by Matthew Taylor – has looked at issues and controversies surrounding jobs within the gig economy such as the employment status of Deliveroo drivers which our Head of Employment, Deborah Scales, has commented on in a previous article.

The Issue – The Gig Economy

The gig economy refers to organisations who ‘offer’ the opportunity for people to essentially work for themselves, when in reality they are treat as contractors rather than employees of the respective company. Due to this employment structure, many critics are of the belief that the gig economy intentionally exploits workers by taking away the same rights that a full-time employee would usually be entitled to. These rights can include, but are not limited to, having a fixed contract, entitlement to paid sick leave and being paid at an hourly rate rather than per delivery.

What is outlined in the ‘Taylor Review’?

The Taylor Review of Modern Practices aims to help over 1 million people who are currently working within the ‘gig economy’ structure by outlining areas that need to be scrutinised and rectified. The review considers the implications of new models of working on the rights of workers and the freedoms and obligations of employers and has made numerous proposals for clarifying the law governing employment status and adjusting the scope of various employment protections. Some of the key issues include the following:

  • Outlining a distinction between ‘employers’ and ‘workers’ and what their respective employee rights should be
  • A reformation of statutory sick pay (SSP) so that it becomes a basic employment right
  • Improving access to holiday pay for seasonal, casual and zero-hours workers by increasing the pay reference period from 12 to 52 weeks
  • Agency workers and zero-hours workers having the right to request a direct contract of employment after 12 months with the same employer
  • The abolition of the ‘Swedish derogation’
  • The extension of the Information and Consultation of Employees Regulations 2004
  • The Government asking the Low Paid Commission (LPC) to advise on the impact of bringing in a higher National Minimum Wage (NMW) for hours which are not guaranteed in a contract, allowing businesses to continue to use zero and short-hours employees but would pay more for their flexibility
  • Employees having the choice to be paid either ‘rolled-up’ holiday pay, receiving premium on their pay rather than paid time off
  • Dependent contractors having the right to a written statement at the start of their engagement, similar to that currently enjoyed by employees, backed up by standalone right to compensation for failure to comply
  • A paid structure put into place for ‘gig economy’ workers who provide their services via an app
  • Putting emphasis on the Government to outline clear tax schemes for ‘employees’, ‘workers’, ‘contractors’ and those that are self employed

In addition to these amendments, the review also calls for the Government to enable a ‘naming and shaming’ scheme for those employers who do not pay employment tribunal awards within a reasonable time. This could also potentially be the case for if any of the basic rights mentioned in the review are not adhered to, meaning that employers will have to take full responsibility for their actions.

The Reaction

The review has since gained a mixed response since publication across various disciplines. A spokesperson for the meal delivery service Deliveroo stated that “we would welcome the opportunity to work with the government so we can end this trade off between flexibility and security” while the head of policy at Uber, Andrew Byrne, has also been positive by saying “(Uber) would welcome greater clarity in the law over different types of employment status”.

On the opposite end of the spectrum, Labour’s shadow business secretary Rebecca Long Bailey took a different point of view by saying "if it looks like a job or it smells like a job then it is a job, and the worker should be employed, and I think in those situations where a worker is carrying out work on behalf of an employer... they should not be exploited as a flexible workers."

TUC general secretary Frances O’Grady echoed Rebecca Long Bailey’s criticism by adding “From what we've seen, this review is not the game-changer needed to end insecurity and exploitation at work."

Deborah Scales and Daniel Stander, Employment Solicitors at Cartwright King, believe that:

“More radical treatment is required to redress the balance between having a legal right on the one hand, and being in a position to enforce that right. The Taylor Review has acknowledged as much, stating that ‘From the decision to take action against your employer to winning or losing the case against them, the odds are often stacked against the worker. This has to change if we are to effectively police fair and decent work.’

“Indeed, whether individuals are to be classed as workers or ‘dependent contractors’ is not much good if access to employment tribunals, the legal mechanism for enforcing employment rights is beyond the reach of many would be claimants, as it can cost up to £1,200 to reach a tribunal. Since employment tribunal fees came into effect in 2013, claims have plummeted by up to 70%, so in our opinion tribunal fees are intertwined with any proposals to reform the law for the gig economy.”

If you have a legal query in relation to Employment Law, please contact our Employment Solicitors on either 0808 168 5550 or info@cartwrightking.co.uk and they will be available to discuss any issues either you or your business may have with you further.

For further information please get in touch with our dedicated team.

You can always call us on 0845 894 1622 or email on info@cartwrightking.co.uk

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