Agency Workers set to reach one million by 2020 if current growth trends continue, reports the Resolution Foundation Think Tank this week. What does this mean for employers and our future working practices?
This announcement comes in the midst of a flurry of activity around Britain’s employment laws and practices. Not a week seems to go by at the moment without at least one story hitting the headlines concerning zero hour contracts, the Gig Economy, worker status and this week it’s agency workers, also described as, ‘the forgotten face of the modern workforce’.
In the release of his Autumn Statement, Chancellor Philip Hammond indicated how the Gig Economy is beginning to affect budget revenues. The Office for Budget Responsibility estimated that in 2020/2021 self-employment and casual work will cost the Treasury £3.5billion from the reduction in tax paid under those models. It is estimated that individuals working under these models are paying £2000 less a year on average in tax than employees doing similar or equivalent jobs.
Agency workers however have significantly less rights and job security than employees. It is estimated that a full time agency worker earns on average £430 a year less than an employee in the same role. With agency worker numbers growing 30% since 2011, the trend certainly looks set to continue. With such stark statistics, it is clear that some effort needs to be made to acknowledge this trend and recognise it in employment legislation. The million dollar question is of course “how”? The Taylor Review may well provide an answer.
We recently reported our analysis of the Uber judgement and zero hour contracts and following on from this judgment Matthew Taylor (Chief Executive of the Royal Society for the Arts) was selected to lead a general review into working practices. Last week the review was officially launched and it is now clearer about what it will entail. The review will be carried out by a team of four experts including Taylor and is planned to last six months, with the team taking evidence in public hearings across the UK between January and March next year. This tour will cover Glasgow, Coventry and Maidstone looking at the manufacturing and rural economies as well as the Gig Economy.
Taylor has stated that he hopes the review ‘will provide a national conversation and explore how we can all contribute to work that provides opportunity, fairness and dignity’. Interestingly (and of great relevance to employers) is his suggestion that companies which have lost in Employment Tribunals should face automatic investigation to check whether illegal behaviour such as the underpayment of national minimum wage or false self-employment were endemic.
Alongside Taylor’s review, is the smaller scale review by the Department for Business Energy and Industrial Strategy launching a research project specifically into the Gig Economy looking at both the scale and the motivations of people engaged. We will keep you posted on the progress of both reviews, but for now it is vital that you start considering a process and approach for reviewing your practices, your terms and conditions of employment and what you are paying your workers. We also suggest keeping an eye out for public hearings on the Taylor Review that may be taking place near you which you could attend.
Training and Awareness
Does your organisation need help understanding agency workers from contractors; Employees or casual staff? Our Employment and HR Training Academy has courses designed to help managers and HR get to grips with how it engages workers and understand the rights and the risks of using different working arrangements. Our business immigration training also outlines document checking responsibilities in respect of the people who work for you. For details of our courses on Employment Rights, Status or Business Immigration please email Emma O'Connor Head of Employment and HR Academy on [email protected].
Consistent with our policy when giving comment and advice on a non-specific basis, we cannot assume legal responsibility for the accuracy of any particular statement. In the case of specific problems we recommend that professional advice be sought.