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The Taylor Review…..What Does It Mean For Employers?

July 13, 2017

The Taylor Review, also known as the ‘Good Work’ Report, published 11 July 2017, has recommended changes to employment law to protect workers it considers are most vulnerable and at risk of exploitation. The Government has said that it will take the Review’s recommendations seriously. But at this stage all the recommendations in the Review are just that – recommendations. The Review makes no changes to the law, but it could be a sign of things to come.

The Review, led by Matthew Taylor, was commissioned by the Government to consider how employment practices need to change in order to keep pace with modern business models. The stated ambition of the Review is that all work in the UK economy should be fair and decent, with a realistic scope for development and fulfilment. In order to help achieve this it says that the Government needs to make a long-term, strategic commitment to this goal.

At present there are three types of individual in the work place – employees, workers and those who are self-employed. Employees have the most employment law protection, then workers and then the self-employed. While the Review wants to retain the three tier model, it says that as the labour market changes and business models develop, legislation needs to be updated. At present deciding the employment status of an individual can be difficult as the guidelines are set out in case law, often making it hard to reach a definitive conclusion. The Review wants:

  • It to be easier for individuals to know what their employment status is, so they know what their rights are – this could help both employers and workers.
  • Changes to the tests to decide employment status.
  • The term ‘dependent contractor’ to be introduced to replace ‘worker’.

The proposals in the Review also include:

  • A requirement that employees and ‘dependent contractors’ receive a written statement of employment particulars on day one, which includes a statement of an individual’s rights, and the right to bring a claim for compensation if this is not provided.
  • Consideration of changes to the national minimum wage rate for hours that are not guaranteed as part of the contract.
  • Allowing holiday pay to be paid on a ‘rolled up basis’, which would mean that workers could be paid holiday as part of their hourly rate.
  • Giving agency workers the right to request a direct contract with the end user after 12 months on an assignment.
  • Giving those on zero-hours contracts the right to request guaranteed hours after 12 months.
  • Giving HMRC responsibility for enforcing sick pay and holiday pay, in addition to its current responsibility to enforce the national minimum wage.
  • Changes to statutory sick pay so that it is accrued based on length of service, in a similar way to paid holiday, along with the right to return to work after an extended period of sick leave.

While the Government has committed to consider the proposals in the Review, it is not under any obligation to make changes to legislation, so for now it is a question of waiting to see what it will do.

Louise Paull, expert Employment LawBrief for LawBite. To consult with Louise about any employment matter or to have an employment agreement reviewed you’re welcome to submit an enquiry here.