A long-awaited review into employment practices has spurned calls for it to recommend a wholesale shake-up in the law, instead proposing that an existing employment category be renamed to cater for so-called 'gig economy' workers.
In his review of modern employment practices, political strategist Matthew Taylor said that 'the best way to achieve better work is not national regulation but responsible corporate governance, good management and strong employment relations within the organisation'.
He recommends that 'worker' status be renamed ‘dependent contractor’. This should be clearer about 'how to distinguish workers from those who are legitimately self-employed'.
Taylor, chief executive of the Royal Society of Arts, Manufactures and Commerce, set out plans to achieve 'good quality work for all' without imposing new legislative burdens. The review notes that the ‘employment wedge’, the additional costs associated with taking on an employee, is already significant and that efforts should be made to avoid increasing it further.
‘Dependent contractors’ are the group most likely to suffer from unfair one-sided flexibility and therefore need to provide additional protections and stronger incentives for businesses to treat them fairly, the review said. Protections should include sickness and holiday pay and a realistic chance to earn above the minimum wage.
The review sets out seven principles for 'fair and decent' work, including sectoral strategies engaging employers, employees and stakeholders to ensure that people are not stuck at the living wage minimum or facing insecurity.
Law Society president Joe Egan welcomed the review, saying UK employment laws are overly complex and that too many people miss out on basic workplace rights. 'The proposed dependent contractor status – a key part of this clarification - is a practical way of lifting people out of false self-employment and giving them clear minimum rights, without closing the door to new and flexible ways of working,' Egan said.
'The current law, which depends on someone taking their own employer to court, is clearly not working, letting bad employers exploit vulnerable staff and deny them their rights,' he added. 'Only independent government enforcement of employment rights can challenge bad employers on a level playing field, and we’re pleased to see the Taylor review embrace this.'
He also welcomed the review's recognition of the barrier to justice created by employment tribunal fees. 'We know that employment tribunal fees have cut people’s ability to defend their rights at work by 70%, and so it is only right that someone should be able to get a ruling on what rights they have at work without paying exorbitant fees.'