The recently published Taylor Review of modern employment practices proposes a number of changes to employment law and although these are currently only recommendations, it’s expected that new rules will be introduced.
Here, employment law expert Michael Shroot explores the potential future changes and how these could impact employers.
Under current laws there are three employer status types – employee, worker and self-employed or contractor. The review proposes that this should be retained but the worker status should be renamed as dependent contractor.
When it comes to determining a person’s employment status, the review suggests the requirement for a person to perform work ‘personally’ for the employer should no longer be a barrier to them gaining dependent contractor (currently worker) status.
This would potentially result in current self-employed or contractors being treated as dependent contractors, meaning they’d gain additional rights, including holiday pay and protection against unlawful discrimination.
It’s proposed that in the event of a dispute about the status of an individual, the burden of proof should be on the employer and not the worker, should the matter go to a tribunal.
The Taylor Review states it should be made easier for dependent contractors to gain access to employment rights which demand a period of continuous service, for example, maternity pay, while statutory sick pay should become a basic right available to all workers from the moment their contract starts.
It was anticipated that the report would recommend all workers should be paid the national minimum wage (NMW), however it did not go this far. Instead, it proposes an opt-in flexible system with companies have to pay at least the minimum wage in exchange for a worker working during busy periods.
The government has also been advised to ask the Low Pay Commission to consider introducing a higher national minimum wage rate for hours that are not guaranteed as part of a worker’s contract. For example, a worker who was contractor for ten hours a week, but who regularly worked more than that could be paid NMW for the first ten hours and a higher amount for any additional hours worked.
A recommendation is made that tribunal fees should be reduced, making it easier for workers to pursue claims. Also, any organisations that fail to pay tribunal awards should face additional costs, and also face the possibility of being named and shamed.
For organisations that rely on self-employed, contractors or workers, the review could have major impact, should the government introduce new legislation to bring the recommendations into effect.
The costs to businesses would be significant if these individuals were to gain rights to NMW, holiday pay, sick pay and other rights, therefore it’s imperative to seek legal assistance at the earliest opportunity.
For advice on worker rights or any other employment law matter, call Michael Shroot on 0161 761 8087 or email him at firstname.lastname@example.org