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Barry  Stanton
Barry Stanton,
Good work: Taylor review sets out proposals for reform
21 February 2018

The Taylor review set out a range of proposals for reform of employment law including clarification of employment status with its aim of “good quality work for all”.  With the Supreme Court hearing the Pimlico Plumbers’ appeal and with other status cases working their way through Tribunals, employment law has rarely had such focus.

Earlier this month, the Government responded to the Taylor Review (published last July). For some this response was a damp squib, as for others the Taylor Report had been. Expecting seismic change is probably at best, optimistic. Are the proposals a damp squib or is there something for all?  After all, it would be expecting a lot for a Conservative Government to launch an attack on its bedrock of business support.

The Taylor Review made some 53 Recommendations. The Government’s response is to accept or agree with 34 of them and to launch four consultations. These consultations invite views on proposals relating to:

• employment status
• enforcement of employment rights 
• agency workers 
• transparency in the labour market

The employment status consultation will close last on 1 June 2018.  

Some of the key recommendations currently being consulted on include:

  • legislative reform to clarify the current legal tests for employment status i.e. whether someone is an “employee” a “worker”, or “self-employed”;
  • the potential reclassification of workers  as “dependent contractors” with a greater focus on the issue of control;
  • the right to a section 1 statement to be extended to contractors;
  • improving transparency for agency workers;
  • obtaining detailed evidence to determine the extent of abuse of the “Swedish Derogation” (which allows agency workers to opt out of equal pay entitlements);
  • providing more transparency for casual/zero hours workers, including provision of a list of “day one” rights, such as holiday pay, sick pay entitlements and a new right to a payslip for all workers;
  • providing a right for workers to request a contract with “more predictable and secure working conditions”;
  • proposals to increase the holiday reference period to 52 weeks, with a view to better protecting atypical workers (to take account of seasonal variations);
  • introduction of a “naming and shaming” scheme for employers that don’t pay tribunal awards;
  • quadrupling employment tribunal fines for employers showing malice, spite or gross oversight to £20,000, and increased penalties for employers who have previously lost similar cases; and
  • asking the Low Pay Commission to consider introducing a higher minimum wage for workers on zero-hour contracts.

One proposal from Taylor that the Government has said it will come back to, is the reversal of the burden of proof in status cases (i.e. that the employer would need to demonstrate that a particular employment relationship does not exist). This will be reconsidered once the Government has developed an online tool to help determine employment status. There is also acceptance that the Government should assist with the enforcement of basic rights for the lowest paid workers.

It is perhaps unsurprising that the Government wants to consult. Only from doing so can it truly gage the views of industry leaders and the unions. Whatever it does it will be difficult to find solutions that please all.  Taylor’s recommendation to codify the case law on status is also significant. One challenge that this will immediately create is that any new legislation would need to be sufficiently flexible to prevent some from using it as a blueprint to avoid employment status.

It seems inevitable that there will be change, hopefully for the better. What is clear from the Government’s response is that change is not imminent and will take time to be achieved. It is to be hoped that when the proposals are finally put forward they take a holistic approach to the problems identified and seek to achieve a better protection for the vulnerable whilst still enabling an agile workforce that is able to respond to the demands of a post-Brexit era.

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.

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