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Taylor Review of precarious work disappoints

THE LONG-AWAITED Taylor Review of Modern Working Practices, an independent review commissioned by the government to address issues of exploitation and injustice around the "gig economy" is out.

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Matthew Taylor delivers his views

The Freelance is ploughing through all its 116 pages. On first impression, it looks pretty disappointing. The GMB union's General Secretary Tim Roache was among many who described it as a missed opportunity after its launch in July. Revelations that panel members had been investors in Deliveroo met with widespread derision. (To be fair, panellist Greg Marsh agreed to sell his stake once asked to take part.)

Freelances can stay freelance, says the Taylor Review. It has much on how the self-employed actually enjoy the flexibility of their working lives, and the phrase "genuine self-employed" appears throughout. (The word "freelance" isn't used, it has no legal status.) There's a notable absence in the review of any talk of the Minimum Wage Act applying to the self-employed.

A key recommendation involves the increasing number of people working under a "false freelance" arrangement - forced to accept a "self-employed" contract by (effectively) their employer, purely because it is in the interests of the company engaging them to do so, denying them holiday pay, sick pay and often even minimum wage. This is in spite of the worker working for only one company, being self-employed in name only. Freelance readers will be familiar with the struggles of "self-employed" bicycle couriers organised as the IWGB union. It crowdfunded Industrial Tribunal cases that won them some of the rights of employees.

The review creates a new status of worker, "dependent contractor", so any (technically) self-employed worker who's under the "control" and "supervision" of a single company should get holiday pay, sick pay and - in most cases - the minimum wage.

Dependent contractors will be clearly defined as different to the legitimately self-employed. There will be obligations put on companies hiring "dependent contractors" to supply these with clear terms of engagement, in writing. There's also an automatic right to compensation at an Employment Tribunal if you weren't issued such documentation. (One frequently heard complaint during the Review and in Parliament Committees was that many such contracts were "gibberish." See the Freelance Fees Guide for some detailed background on employment status and degree of "control" the workforce.

Some types of companies should be required to publish data on how many zero-hour contract or agency workers they use. Another recommendation is for a slightly higher minimum wage for zero-hour piece-work, although Taylor stops short of calling for zero hour contracts to be abolished. Umbrella companies, agencies that charge employees for their admin, are up for abolition either.

Another cop-out is Employment Tribunal fees, a huge deterrent to workers seeking claims. The Review doesn't address this, it only suggests that claimants should be advised right at the beginning of their case whether they're even eligible to bring a claim (based on their "work status").

There is much about taxation of labour, particularly how confusing it is and - ominously for freelances - discussion of "a need to make the taxation of labour more consistent across employment forms". There's also talk of a "need to remove disparity between different NIC rates paid by employed and self-employed." Could this mean that the tax raid on the self-employed in the last Budget, currently postponed, may reappear? The "Review believes that the principles underlying the proposed NI reforms in the 2017 spring budget are correct" so there's a real possibility. There is vague talk of more "areas of entitlement" such as parental leave for the self-employed as a pay-off for being taxed more.

This is a preference for "good corporate governance" over regulation. Prime Minister Theresa May said the recommendations would be taken on board in "a British way", so there's unlikely to be any actual legislation. The ability of this government to achieve or implement anything is very limited anyway, and May's record on workers rights is not good (remember what happened to workers on company boards?)

The Taylor Review is also weak on the "enforcement landscape," suggesting that HRMC enforce holiday pay while Business and Enterprise go after employers who don't cough up after a Tribunal case by naming and shaming. This seems to ignore the fact that successive cuts to government agencies' budgets mean there is now effectively almost no labour market enforcement at all actually happening.

  • This article was updated on 04/08/17 to correct a typo.