The government has published its Good Work Plan in response to Matthew Taylor's review of modern working practices. While the response sets out the government's intention to proceed with nearly all of the review's recommendations, it lacks specific proposals and much of the detail will be subject to further consultation.
Taylor's independent review of modern working practices, published in July 2017, recommended various reforms to the employment law framework. Since then, while the government's response was awaited, legal challenges to employment status (for further details please see "Uber's worker status appeal rejected") and media reporting on working arrangements have continued. In November 2017 two select committees published a joint report and draft bill on employment status (for further details please see "Employment status review announced in response to Taylor report").
Although the government's response states that it has acted on "all but one" of Taylor's 53 recommendations, the four related consultation documents published alongside the response largely focus on seeking views on the detail and impact of potential changes, rather than committing to any specific changes to the law. In many cases, the government asks for further evidence on how the rules are working.
The government's commitments to take action, on which consultation is invited, include:
- considering the case for legislative change and potential for reforming the tests for establishing employment status in order to achieve clarity and certainty;
- defining 'working time' for national minimum wage purposes for flexible workers who find jobs through app-based platforms;
- enforcing a wider range of basic employment rights, including holiday and sick pay, for vulnerable workers;
- simplifying the enforcement process for employment tribunal awards;
- introducing a 'name and shame' scheme for employers that fail to pay employment tribunal awards;
- implementing stronger penalties for employers who have previously lost similar cases and greater use of aggravated breach penalties and costs orders, including increasing the limit on financial penalties from £5,000 to £20,000;
- improving pay transparency for agency workers;
- gathering evidence of the level of abuse of the so-called 'Swedish derogation' under the Agency Workers Regulations 2010, with a view to strengthening enforcement or repealing it;
- extending the right to written particulars to all workers from day one;
- introducing a right for workers with variable hours to request a more predictable and stable contract;
- asking the Low Pay Commission to consider the impact of higher minimum wage rates for workers on zero-hour contracts;
- increasing the pay reference period for calculating holiday pay from 12 to 52 weeks (the government's position on rolled-up holiday pay remains unchanged);
- extending the relevant break in service for the calculation of the continuous service qualifying period (currently one week);
- gathering more evidence on the effectiveness of the Information and Consultation of Employees Regulations in order to assess Taylor's recommendations; and
- supporting the development of a worktech catalyst to encourage greater collective voice among self-employed individuals.
Acknowledging that employment status in particular is a complex area, the government has put forward no firm proposals. The consultation document clarifies that "no decisions about whether or how to reform employment status, or to aim for alignment between the tests for tax and rights, have been made yet". However, it also clarifies that the government has no intention of revisiting the arguments for reducing the difference in the rate of national insurance contributions paid in respect of employees and self-employed individuals, stating that "we are clear we have no plans to revisit this issue".
The government will also "take into account any significant changes in the case law precedents as work in this area progresses". With a number of appeals concerning employment status in the pipeline, this may influence the government's direction on the issue.
Notwithstanding the government's assurances that the consultations are about how, rather than whether, to implement Taylor's recommendations, many areas remain unresolved. Despite government calls for "quick progress", it is likely to be some time before any specific proposals for reform materialise following the consultation process, let alone become law. The four consultations close on various dates between May 9 2018 and June 1 2018; therefore, the chances of any significant proposals for legislative change appearing before autumn (at the earliest) seem slim.
Taylor's recommendations could be the catalyst for a significant shake-up of employment law to meet the challenges of the changing world of work. However, it remains to be seen how bold the prime minister will be in the context of competing priorities in the run-up to Brexit.
The four consultation documents refer to:
- employment status – consultation closes on June 1 2018;
- enforcement of employment rights recommendations – consultation closes on May 16 2018;
- agency workers recommendations – consultation closes on May 9 2018; and
- increasing transparency in the labour market – consultation closes on May 23 2018.
For further information on this topic please contact Colin Leckey or Madeleine Jephcott at Lewis Silkin by telephone (+44 20 7074 8000?) or email (firstname.lastname@example.org or email@example.com). The Lewis Silkin website can be accessed at www.lewissilkin.com.
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