The Government announces reforms to employment law in response to the Taylor Review

In July 2017 Matthew Taylor published “Good Work: the Taylor Review of Modern Working Practices” which included a number of recommendations to improve rights for employees and workers, in particular those who are seen as ‘vulnerable’ i.e. those working on agency, zero hours or casual contracts in the gig economy. Following a period of consultation, the government has now published its response to the Taylor Review, entitled the ‘Good Work Plan’. The Plan is broadly broken down into three sections: fair and decent work, clarity for employers and workers and fairer enforcement.

The key points of the Plan are as follows:

• All workers on contracts with non-guaranteed hours will have the right to request a more predictable and stable contract after 26 weeks’ service. Such requests would have to be dealt with in a similar way to flexible working requests and employers would have three months to respond.
• At present a gap of one whole week in employment can break continuity of service. This will be extended to 4 weeks with the aim of making it easier for casual staff to accrue certain employment rights.
• All workers (not just employees) will have the right to a written statement of terms and conditions that must be given to them on or before the first day of employment. In addition, the information that must be given in the written statement is to be expanded.
• The reference period for determining an average week’s pay for the purposes of calculating holiday pay will be increased from 12 weeks to 52 weeks.
• The ‘Swedish Derogation’ which allows employment businesses to avoid giving agency workers pay parity with comparable direct recruits of the hirer in certain circumstances will be repealed so that all agency workers have a right to pay parity after they have worked on an assignment for 12 weeks. 
• The government also intends to make it easier for vulnerable workers to enforce their rights and intends to introduce state led enforcement of holiday pay, to name and shame employers who fail to pay tribunal awards, and to allow for increased penalties for employees who are found to have repeatedly breached employment law.

However, the government has failed to set out how it intends to clarify the tests for employment status despite this being one of the key recommendations of the Taylor Review. In particular, the Taylor Review found that the definition of “worker“ needs to be clearer and more consistent with less emphasis on personal service and more emphasis on the amount of control that the employer exercises over the individual. This is based on concerns that employers are putting a right of substitution into contracts in order to defeat arguments over worker status, see the Deliveroo case for a prime example of this. The government has said that it has commissioned independent research to help it resolve this conundrum. Trades union have, rightly, pointed out that this makes the government’s proposed reforms considerably less helpful to vulnerable workers than they could be.