The Taylor Review Of Employment Practices has been released – and received with mixed reviews
The long awaited Taylor Review of employment practices suggests that a national strategy is needed to help provide security in such areas as wages, quality of employment, education and training, working conditions, work life balance and the ability to progress at work.
One of the areas of focus relates to the ‘gig’ economy, with the report recommending the creation of a new category of worker, known as a ‘dependent contractor’, to provide additional rights and benefits for those who are currently classed as self-employed, but who work for businesses which have a ‘controlling and supervisory’ relationship with their workers.
The additional benefits would include sick pay, holiday entitlement and the minimum wage, and the new employment status would also oblige these businesses to pay national insurance contributions for these workers.
What does this mean for self employed businesses?
Business groups have given mixed reactions to the report’s findings, with many welcoming the focus on labour market flexibility. However, some believe the report falls short of solving the most pressing issue facing the UK’s flexible labour market – clarifying what self-employment is.
Self-employment should mean being able to decide when and how you work, fitting it around other commitments and responsibilities such as childcare. Beyond that, it is often an empowering and rewarding way of working. This came across clearly in Taylor’s report. British consumers, businesses and the wider UK economy have greatly benefited from the flexibility offered by freelancers, those on zero-hours contracts and the self-employed, and this flexibility helps businesses to cope with peaks in demand and enables them to be more innovative.
However, there are still instances where individuals are miss-classified as self-employed, and this is what must be resolved. Taylor does seem to touch on this issue as the report calls for clearer legislation on status – but what’s really needed is a statutory definition of self-employment and currently, self-employment is a default category assigned to those who are neither employees nor workers.
Taylor wants to rename worker status ‘dependent contractor’. This could lead the way to a clearer definition, but there could still be am issue of who falls into this group correctly. Taylor highlighted that it will still be up to the courts to rule on employment status, which is a big hurdle for those who may believe their status is different to what their employer has suggested. However, it could be a problem for HMRC as they can challenge a person they believe is falsley self-employed, in this case, this can be a time consuming case.