Employment Law News Alert – Response to Taylor Review

February 12, 2018

A potted summary of the Government’s response to the Taylor Review.

The Government published its full response to Matthew Taylor’s Review of Modern Working Practices on Wednesday. They did so alongside consultation papers seeking views on employment status, increasing transparency in the labour market, agency workers, and enforcement of employment rights.

The Government response can be found at: https://www.gov.uk/government/publications/government-response-to-the-taylor-review-of-modern-working-practices.

A potted summary of the Government’s response and consultation questions are set out below:

Employment status 

The Government accept that the core tests currently used to determine employment status (drawn from case law), have caused a real lack of clarity. It asks whether the main principles of mutuality of obligation, personal service and control should be enshrined in legislation and, if so, to what extent.

The Government also:

  • asks whether narrowing down the number of factors to be considered to determine employment status would make for a less complex and more objective test. A narrower test is already used in determining whether agency workers should be taxed as employees by assessing whether they work under another’s ‘supervision, direction or control’.
  • intends to develop an online tool which provides people with an indication of their employment status, similar to the existing tax tool, will be developed.

 

Working time and basic worker rights

The Government:

  • has sought views on how working time and national minimum wage rules should be enforced in the context of digital platforms.
  • plans to make it easier for people without traditional working relationships to establish continuity of service by extending the period of time between contracts, which breaks continuity, beyond one week.

 

All workers should receive a written statement of terms and have the right to request a more predictable and stable form of employment.

The 12-week reference period used to calculate a week’s holiday pay does not work for everyone and the Government has therefore sought opinions on whether the period should be extended to 52 weeks.

HMRC should take responsibility for enforcing NMW, sick pay and holiday pay for the lowest paid workers. The Government will assess the scale of abuse in order to decide the best way to enforce the laws.

 

Agency Workers

Depending on the extent of abuse found by the Government, it might repeal the ‘Swedish Derogation’ (which allows opt-put of pay obligations under the Agency worker Regulations).

Agency workers and work-seekers should be provided with clear information on who will pay them and the rate of pay they will receive, possibly via a ‘key facts’ page.

 

General

The Government will:

  • consider a new requirement for companies to publish a ‘People Report’ on workforce structures and employment practices, if necessary.
  • review and consolidate guidance on the statutory protections that apply to pregnant workers and those on maternity leave, and will review legislation relating to protection against redundancy
  • consider whether to reform statutory sick pay so that all workers are eligible regardless of income from day one.  The Taylor Review had suggested that individuals returning from a period of long-term sick leave should have the right to return to the same (or similar) job – however, the Response states that this requires further thought and the Government will consider how engagement with occupational health services can support this.

 

HM Courts and Tribunal Service has commenced a review of the process for dealing with unpaid awards throughout the courts and tribunals system, and the Government has acknowledged that this and further work is necessary.

Employers who receive an employment claim judgment against them, the facts and circumstances of which apply to other workers within the organisation, should ensure their contracts and relationships are updated accordingly. Repeat offenders could be liable to pay a fine for aggravated breach which will be raised from £5,000 to at least £20,000.

The Government proposes introducing ‘naming and shaming’ scheme for employers who do not pay employment tribunal awards.

 

If you require advice on any employment matter, please get in touch.

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