31 Jan 2017
The Business, Energy and Industrial Strategy Committee has recently launched an inquiry into the “Future World of Work and Rights of Workers”, focusing on the rights and status of individuals who work in the colloquially-known ‘gig economy’ and those individuals who work in non-traditional employee roles. This particular committee has also recently looked into the working practices of Sports Direct, and the employment status of individuals in the ‘sharing economy’. Furthermore, there is a lot of recent or pending litigation in in relation to the employment status of those purported to be self-employed, such as Uber, CitySprint, Addison Lee, eCourier and Excel. In addition, HMRC investigations are taking place in relation to the same issue for renowned couriers, Hermes. The employment status of individuals is certainly a hot topic and is set to affect a significant amount of people if changes are made, given that the latest statistics report an unprecedented number of people who purport to be self-employed – some 4.79 million. The inquiry is firstly looking into the current legislative definition of what exactly constitutes a worker, and whether it is sufficiently defined. Under current definition, a worker is essentially anyone who works under any form of contract, where they agree to personally perform any work or services for another party, provided the contract is not one of a client or customer of any profession or business. There has been a plethora of litigation regarding this definition, which suggests that it is not clear enough, and needs redefining. Other areas under review are whether those individuals who are agency workers and workers who are not employees have sufficient protection and rights. However, in our opinion, we are unsure whether this line of inquiry will prove to be productive. Agency workers are already provided with statutory protection and rights under the Agency Workers Regulations 2010. Similarly, all forms of workers are provided with protection under discrimination legislation and other areas of employment such a National Minimum Wage/Living Wage and working time, rest time and holidays under the Working Time Regulations 1998. The main area that workers do not have protection which employees do is unfair dismissal, which is generally only applicable to employees who have at least two years’ service. Arguably, this means that it would not apply to many agency and casual workers. Interestingly, the Committee is also questioning the levels of support offered to employees and self-employed individuals in areas such as statutory sick pay (“SSP”), holiday pay, pensions and maternity pay. In our opinion, if an individual cannot work due to sickness or maternity, Government assistance should not be dependent on the employment status of the individual. However, this is more or less the case at the moment, albeit they are different vehicles for this support. For example, SSP is paid to workers, and Employment and Support Allowance can be applied for by an incapacitated self-employed individual – although they are paid a lower rate than SSP for the first 13 weeks. However, we consider that areas such as holiday pay would not be applicable for Government support for self-employed individuals, given that these individuals have contractual freedom to take holiday, to budget for and include this in any contract that they choose to enter into. This is not the case for employees, whereby the employer has control over the level of work and how much holiday an employee takes. We consider that, although the other lines of inquiry for this Committee are worthwhile, ultimately we are of the opinion that the priority for any Parliamentary intervention in the area of employment status should be to provide a legislative change to the definition of a worker, in order to provide clarity to businesses, employers and individuals to ascertain their status and what their rights are when entering into contracts to provide work or services. The Committee has asked for written submissions from interested parties to assist in this inquiry and Amanda Beattie and Kaushik Chaudhuri have provided them with a written submission on behalf of Croner Group Limited, which can be read in full here. Croner has also previously published a guide to Employment Status and worker rights, click here to download your copy.
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