Government response to the Taylor Review on Modern Working Practices

We wrote last year about the review done by Matthew Taylor into modern working practices. The review resulted in a number of recommendations, just over 50 in all, over changes to employment law.

The Government has published its response to the Taylor Review.

Rather than adopt the most striking of the recommendations the Government has decided to launch a number of consultations, and has produced papers in respect of each of the proposed consultations. The topics of those consultations are: protection for agency staff, measures to increase transparency in the UK labour market, employment status, and the enforcement of employment rights.

There are a number of measures that the Government has stated that it will take as a consequence of the Taylor Review. However, there are also a number of recommendations in the Review that the Government has stated that it will not be adopting.

The measures that the Government has decided it will be adopting include:-

• Quadrupling fines available in the Employment Tribunal against employers that show malice, spite, or gross oversight, to £20,000 and considering increasing penalties for employers who have previously lost similar cases,

• Naming and shaming employers that fail to pay Employment Tribunal awards,

• A new right to a payslip for all workers (including casual and zero-hours workers) [remember that all employees already have this right]

• Helping workers enforce their rights to holiday pay and sick pay,

• A right for all workers, ie not just zero-hours workers and agency workers, to “request a more stable contract.”

  It is unclear as to exactly what is meant by the phrase “a more stable contract,” which leaves us wondering what this right actually amounts to.

  Turning to the consultation subjects:

  Employment status

  The consultation paper asks if employment status should be codified in legislation. The Taylor Review had recommended that the case law principles in this area should be codified, ie derived from the cases that address the subjects of control, mutuality of obligations and personal service. The Government appears to accept that that is currently a lack of clarity and certainty over employment status, and raises the question of moving to a different test for employment status. The Government has also proposed to introduce an online tool to assist people in helping to ascertain their employment status.

  The Government has said that it intends to extend the rights to written particulars of employment (currently only enjoyed by employees) to all workers from the start of their employment.

  Protection for agency staff 

  The Government has invited suggestion and comments on how agency and other irregular staff can establish “continuity of service” (currently a break of over a week breaks continuity of employment for these workers in many cases).

  The consultation invites suggestions on how long an individual should be required to wait before being able to ask for a direct contract, and about requesting for a more predictable contract (though as indicated above, there is no explanation of this term). The consultation also asks for views on the “Swedish derogation”- which excludes workers who have a contract that provides for a minimum level of pay between assignments from the right to have equal pay with the permanent staff.

  Enforcement of employment rights

  The Government accepts that the HMRC should take responsibility for enforcing the basic set of pay rights that apply to all low paid workers (ie minimum wage, sick pay, and holiday pay). The consultation also raises the question of how to apply enforcement reforms through the Employment Tribunals.

  The Government has also indicated that it will consider proposals to reform statutory sick pay, so that all workers are eligible regardless of income from day one, and that it accrues on length of service.

  Not going forward

  Proposals not going forward include a proposal that where employment status is in dispute that the burden of proof should be on the employer to show the individual was not an employee (currently the individual has to establish that they are an employee).  

  Obviously, we will have to see what comes out of the consultation before knowing what changes, if any, will be made in the areas being consulted over.

  If you need any further advice on any matter raised in this article do not hesitate to contact us at Hallett Employment Law Services Ltd.