Two employment lawyers have forecast that significant change, including further clarifications on the distinctions between employees, vulnerable workers and contracting professionals, will arise in 2018 via case law, irrespective of whether the government has time to introduce formal employment law reforms.
Writing for the online legal news site Lexology, lawyers Kirsti Laird and Clare Davis of the employment law firm Charles Russell Speechlys, chart how the gig economy has transformed the landscape of work in the UK in the past a few years. Just ten years ago, those designated as self-employed were predominantly highly skilled contracting professionals. Fast forward to the present, and vastly more people have come under this heading through the rise of the gig economy and flexible working arrangements, even though they are often engaged in a far more precarious way and earn considerably less than high-end contractors.
Currently, UK employment law recognises three groups:
- Employees, who enjoy the full suite of statutory employment rights and protections.
- Workers, who have more limited employment rights such as the national minimum wage, holiday pay, restrictions on working time and protection against discrimination.
- Self-employed (contractors), who have few rights beyond those specifically connected to their contract for services.
But with such large numbers of people being engaged as “contractors” in the gig economy yet lacking the control and flexibility over their working arrangements enjoyed by their well-paid professional counterparts, the waters have been muddied. Concerns have multiplied that too many are being forced into dubious forms of self-employment to allow gig businesses to avoid paying for employment benefits.
The Taylor Review of Modern Working Practices offered recommendations that would allow genuine independent professional contracting to flourish while also ending exploitation of workers inappropriately forced into dubious self-employment. In December 2017, the Parliamentary Committees for Work and Pensions and Business, Energy and Industrial Strategy issued a joint report based on the Taylor review. It included clearer statutory definitions of employment status, stressing the importance of supervision and control of workers by a company in differentiating between workers and genuine independent contractors.
But Laird and Davis appear doubtful that much legislative progress will be made on these proposals for reform in 2018 as Brexit negotiations are too consuming of government time. Even so, crucial decisions are setting precedents in case law, which has so far predominantly favoured the claims of gig workers that they should receive employment benefits rather than be classified as self-employed. These developments, Laird and Davis explain, will certainly continue this year, and employers would be wise to seek advice “when employing or engaging individuals to ensure assessments of the relationship are made at the time and appropriate documentation is put in place.”