Taylor Review - The government response to Good Work?

The government has today published it’s response to the Taylor Review – Good Work.  The overarching ambition of the final report from the Taylor Review was that all work in the UK economy should be fair and decent with realistic scope for development and fulfilment. 

The Good Work report included 53 recommendations and the government has accepted all but one of them.  It rejected his proposals to reduce the difference between the National Insurance contributions of employees and the self-employed following Budget 2016 and subsequently have no plans to revisit the issue.

Delivering on the Prime Minister’s pledge to not just protect but build on workers’ rights, the government set out proposals to ensure workers know their rights and receive the benefits and protections they are entitled to, and that action is taken against employers who breach workers’ rights. For the first time, will be accountable for good quality work as well as quantity of jobs.

In some cases the government plans to go further than the review’s proposals, including:

• enforcing vulnerable workers’ holiday and sick pay for the first time;
• a list of day-one rights including holiday and sick pay entitlements and a new right to a payslip for all workers, including casual and zero-hour workers;
• a right for all workers, not just zero-hour and agency, to request a more stable contract, providing more financial security for those on flexible contracts;
• making reforms that will ensure that employment law and practices keep pace with modern ways of working created by rapid technological change.

The response from the Government launches several consultations which are:

•  Employment Status – deadline 11.45pm, 1 June 2018
• Enforcement of employment rights recommendations – deadline 11.45pm 16 May 2018
• Increasing transparency in the labour market – deadline 11.45pm, 23 May 2018
• Agency Workers recommendations  - deadline 11.45pm, 9 May 2018

There needs to be full consideration of the legislative options for employment status in order to ensure that any reforms achieve their aims and do not have unintended consequences, such as damaging genuine flexibility or creating opportunities for less scrupulous employers to game the system and gain an unfair competitive advantage.  The purpose of the consultation is to improve clarity for those on the boundary between employment, self-employment and the worker.

In the consultation on employment status for tax purposes, the consultation considers the tests that define the boundary between those currently taxed as employees and those who are taxed on a self-employed basis.  While the government acknowledges that some have suggested there should be no boundary at all for tax, that proposition is not considered in this document.  This document does also not consider changes to tax or NICs rates or reliefs.

So, the Government are looking at everything ‘employment status’ apart from the actual tax treatment.  They are not planning on adjusting the primary contributions for national insurance for the self-employed but, are they planning on an equivalent tax for the employer or person who engages the self-employed person?

What we do know is that there is due to be a consultation on off payroll working in the private sector, which affects those who provide their services through a limited company, otherwise known as a personal service company.  Although, I hasten to add, there is no actual definition of personal service company.   If brought in, this measure is likely to include the secondary contribution for national insurance by the employer. 

What we know for certain is that the Government has to do something to plug the 4.5bn deficit which will be created by the so called gig economy by 2020.

So, is the Good Plan a good response?  It promises a lot and there will be a lot of work for those who choose to respond to the consultations but, there is nothing concrete as it all depend on the outcomes from the consultations.

Documents

7 Feb 2018 - Press Release - Millions to benefit from enhanced rights as government responds to Taylor review of modern working practices

The UK will become one of the first countries to address the challenges of the changing world of work in the modern economy.

https://www.gov.uk/government/news/millions-to-benefit-from-enhanced-rights-as-government-responds-to-taylor-review-of-modern-working-practices

1.            Government response to the Taylor review of modern working practices

The government’s response to the Matthew Taylor review, including our Good Work Plan for taking forward its recommendations on employment policy and legislation.

https://www.gov.uk/government/publications/government-response-to-the-taylor-review-of-modern-working-practices

2.            Consultations

Employment Status – deadline 11.45pm, 1 June 2018

We’re seeking views on whether the options proposed in the Taylor Review of Modern Work Practices could achieve more certainty and clarity for businesses when determining employment status, particularly in relation to the realities of the modern labour market.

We are also seeking to understand the potential impacts and implications of those proposals. In addition, this consultation considers whether there are alternative approaches that could better achieve these aims. For tax, this consultation considers the tests that define the boundary between those currently taxed as employees and those who are taxed on a self-employed basis.

https://www.gov.uk/government/consultations/employment-status

Enforcement of employment rights recommendations – deadline 11.45pm 16 May 2018

We’re seeking views on the recommendations in the Matthew Taylor Review of modern working practices on the enforcement of employment rights.

This consultation:

• sets out the government’s intention to enforce a wider range of basic employment rights on behalf of vulnerable workers
• seeks evidence on the extent of the problem faced by low paid workers in accessing sick pay and holiday pay to help target enforcement efforts
• sets out the government’s plans to simplify the enforcement process for employment tribunal awards
• outlines the government’s intention to introduce a naming scheme for unpaid employment tribunal awards
• takes forward the review’s recommendations that employment tribunal judges should be obliged to consider stronger punishments for employers who ignore previous tribunal judgments
• seeks views on how best to implement these measures

https://www.gov.uk/government/consultations/enforcement-of-employment-rights-recommendations

Increasing transparency in the labour market – deadline 11.45pm, 23 May 2018

We’re seeking views on the recommendations in Good work: the Taylor review of modern working practices that focus on increasing transparency between employers and individuals in the UK labour market.

We welcome views from businesses, unions, employer associations, workers and other interested organisations and individuals on our proposals.

https://www.gov.uk/government/consultations/increasing-transparency-in-the-labour-market

Agency Workers recommendations  - deadline 11.45pm, 9 May 2018

We’re seeking views on recommendations made in the Good Work: Review of modern employment practices published on July 7 2017.

It looks at:

• how to increase transparency of contractual arrangements for agency workers
• how umbrella companies or intermediaries could be brought within the scope of the Employment Agency Standards Inspectorate (EAS)

It also seeks to gather evidence on the level of abuse of the ‘Swedish Derogation’ with consideration of whether EAS’ remit should be extended to cover the enforcement of the Agency Workers Regulations.

https://www.gov.uk/government/consultations/agency-workers-recommendations

3.            Research

Gig Economy research (Dept. Business, Energy & Industrial Strategy ‘BEIS’)

https://www.gov.uk/government/publications/gig-economy-research

The characteristics of individuals in the gig economy

This research uses nationally representative surveys to cover 3 key areas:

• developing a working definition of the gig economy
• using the working definition to estimate the number of individuals who have found work via the gig economy
• providing information on the characteristics of those who work in the gig economy
• 
  

The experiences of individuals in the gig economy

This research uses 150 interviews to look at several aspects of the gig economy and the experiences of individuals within it:

• motivations for working in the gig economy
• experiences of working in the gig economy
• pay and conditions
• employment rights
• skills and training
• main perceived advantages and disadvantages
• future plans

The use of Pay Between Assignment contracts for agency workers including the role of umbrella organisations

This study aimed to understand reasons why individuals choose to sign up to Pay Between Assignment contracts, and to obtain more information on the role of umbrella organisations in the use of these contracts.

Labour Market Reform

All links to what the government is doing about labour market reform.

https://www.gov.uk/government/policies/labour-market-reform