Response to Taylor Review

The Government publishes its response to the recommendations of the Taylor Review of Modern Working Practices: the launch of 4 new consultations

Last week, the Government published its much-anticipated response to the recommendations flowing from the Taylor Review which looked at modern working practices following the rise of the ‘gig’ economy. The full report can be accessed here:

Disappointingly, the Government’s response contains very few clear policy commitments preferring, instead, to start wide-ranging consultation processes regarding some of the key areas, namely:

employment status

enforcement of employment rights

agency workers

increasing transparency in the UK labour market

Chances are we won’t see much progress soon, and probably not in this Parliament, to codify or clarify the thorny, and unpredictable, issue of employment status for employers.  In the short term, Employment Tribunals and appeal courts across the UK will continue to grapple with these issues and reach fact-specific conclusions on individuals’ status in cases coming through from the ‘gig’ economy and beyond.   This is far from satisfactory, but reflective perhaps of the difficulty facing Parliament in deciding the best and most appropriate legislative solution from the range of options available.

Here’s our summary of the main proposals which are to be taken forward, and those which are not:

Proposals / reforms flowing from the Taylor Review which the Government has indicated will go ahead:

  • introduction of a new right for all workers, including zero-hour and agency workers, to request “a more stable contract”;
  • extension of the right to receive a payslip to all workers and a requirement that employers must state the hours being paid for on the payslips of time-paid workers
  • assistance from the state, through HMRC, will be given to workers to enforce national minimum wage, holiday and sickness rights;
  • introduction of a new ‘naming and shaming’ scheme for employers who fail to pay employment tribunal awards;
  • quadruple increase, from £5,000 to at least £20,000 for employers found to have committed an aggravated breach of employment legislation;
  • the Low Pay Commission will consider the impact of higher minimum wage rates for workers on zero-hour contracts;
  • new definition of ‘working time’ for flexible workers who find jobs through apps or online portals so they know when they should be being paid; and
  • further action to ensure unpaid interns are not doing the job of a worker.

Proposals / reforms which we now know won’t be going ahead: 

  • the recommendation for workers to be able to receive rolled-up holiday pay has been rejected as this is contrary to EU law;
  • the recommendation that employers have the burden of proof in employment status cases has been rejected, for now, pending the development of an online tool to check employment status;
  • as an aside, the Government has taken the opportunity to confirm that no reform will be made in respect of non-compete clauses – they are viewed as being valuable and necessary and will remain.

And, finally, it may have escaped the headlines but didn’t escape our attention – nestled deep in the report at page 50 is the suggestion that the Government may be considering the reintroduction of Tribunal fees. The Government reminds us that the Supreme Court in R (on the application of Unison) v Lord Chancellor did not find the charging of fees as being wrong in principle and accepted that fees were a legitimate means of making resources available to the system of courts and tribunals. They are reviewing the Supreme Court’s Judgment “carefully”. One possibility if fees are reintroduced, is for claims regarding employment status to be exempt and not attract a fee under that system.

For more information or insight into workers’ rights and how to avoid common pitfalls associated with the wrong categorisation, please get in touch with Tiggy or Emma


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