A new Whitehall working group on employment status “offers little hope of badly needed reform,” a leading industry expert has warned.

Crawford Temple, CEO of the Umbrella Company trade group PRISM, has drawn attention to the fact that the new cross-government committee is not as ‘new’ as it might appear: its membership is drawn from the same departments which have so far consistently failed to bring employment rules up to date.

Mr. Temple last week announced that PRISM is to invite the Social Market Foundation (SMF) to conduct a strategic review of employment practices and legislation. The review will be wholly independent from the industry and government.

55 Parliamentarians backed the call for a strategic review and the SNP tabled it as an amendment to the Finance Bill. To date, the government has refused to commission one.

The departments involved in the new working group, Crawford said, had each been responsible for the “endless sticking plaster approach” which has resulted in ceaseless changes for the employment intermediaries sector to contend with.

He said: “The group is chaired by the head of employment status at HMRC. So what’s new?

“I am not convinced that if you have the same people looking at the same problems it is going to deliver any new outcomes so it offers little hope of badly needed reform. We are just going to end up with the same answers we have always had.”

In addition to its efforts to secure a strategic review, PRISM has campaigned vigorously against the abolition of tax relief on travel and subsistence expenses incurred by the UK’s 1.6 million-strong army of contracting professionals. Existing employment legislation stubbornly adheres to an outdated binary classification system that divides the workforce into ‘employed’ or ‘self-employed.’ But today, rising numbers of employers are engaging a growing body of skilled workers who have opted for independent contracting, a third way of working which falls into neither of the two categories properly.

Mr Temple said that the problem was that it was considerably less effort to maintain the status quo and insist that everyone can be shoehorned into either ‘employed’ or ‘self-employed’ status than to adapt to the modern engagement structures businesses today require.

He went on: “This is why PRISM is taking the lead and organising an independent strategic review sponsored by industry to be undertaken by the SMF which is a leading and respected think tank.”

Describing the review as “vital and long overdue” to fully understand what modern businesses need, he added: “We need an independent, fresh, new and credible pair of eyes on this.”

 

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