Taylor made recommendations
We report on the recommendations of the Taylor Review and the implications for all employers.
The eagerly anticipated Taylor Review of modern employment practices was published on 11 July 2017. The review considers the implications of new forms of work, including the “gig economy”, on worker rights and responsibilities and aims to address the challenges facing the labour market.
A key focus of the review is the problems that the gig economy has created in assessing employment status for tax and employment rights purposes. There has been considerable publicity recently concerning how such individuals should be classified and whether they are receiving sufficient legal protection.
Commentators have suggested there is a sense that the gig economy puts too much power into the hands of the employer by transferring risks to workers – something the report refers to as ‘one-sided flexibility’. In order to combat this development the review makes various recommendations designed to improve the working conditions of workers in the gig economy.
This includes a suggestion to reverse the burden of proof so the employer has to prove that the individual is not entitled to employment rights whenever there is a dispute. Another proposal is the creation of a free online tool providing advice and information on entitlement to rights, how to qualify for them, and signpost other relevant information. Individuals would also have a right to have a tribunal evaluate their status without having to pay tribunal fees.
Zero-hour contracts, another contentious modern working practice, are also discussed in the review. The review suggests introducing a higher rate of national minimum wage for hours that are not guaranteed as part of a contract, i.e. an employer would have to pay a zero-hours worker more than a worker with guaranteed hours. This could lead to additional costs for businesses that rely on flexible working arrangements and may prompt businesses to review the contracts they offer their workers.
The review covers a host of employment issues and some recommendations arguably lack the necessary detail to be fully evaluated. Consultations will need to take place before any new law is drafted and it remains to be seen whether the government would, or could, implement any of the recommendations.
Employers should keep the review in perspective and until consultations take place (expected to begin in autumn 2017) and new laws are drafted there is no legal need to implement any changes. However, employers must still ensure that they are correctly classifying the status of the people who work for them and treating their zero-hour workers in accordance with current legislation.