Get in touch 0117 325 0526
Get in touch 0117 325 0526
The Government’s response to the Taylor Review of Modern Working Practices (the ‘Good Work’ plan) back in 2018 included a number of consultations.
One of these consultations was on employment status. This asked for views on, amongst other things, whether ‘worker’ status should be retained and whether the tests for employment status for tax and employment rights should be aligned.
The Government has published its response to the consultation on employment status. The main message from the Government in its response is that there will be no changes to the law on employment status for now, but it has instead published new guidance on this topic.
Although the response confirmed that the boundaries between the different types of employment status can be unclear (e.g. worker, employee, self-employed), the Government considers that this three-tiered employment status framework currently provides the right balance of flexibility, whilst protecting core rights such as the minimum wage and the right to holiday pay. In particular ‘the benefits of creating a new framework for employment status are currently outweighed by the potential disruption associated with legislative reform’.
The Government recognises that whilst the employment status frameworks for rights and tax serve different purposes, there could be some benefits to greater alignment between the two systems. However, it has decided that now is not the right time to bring forward proposals for alignment between the two frameworks. It will, in the longer-term, explore options to improve the employment status system for tax to ensure it is as clear as possible and usable for all parties.
The Government has published new employment status guidance for employment rights. It says that the aim of the guidance is that both business and workers will benefit from greater clarity over their employment status. The guidance intends to bring together employment status case law into one place for business and individuals to access. It aims to enable workers to understand the rights they are entitled to and also to clarify the rights that apply to gig economy workers, including national minimum wage and paid leave.
The guidance is in three parts:
The Government has also updated its guidance on Calculating the National Minimum Wage to add a new section on gig economy and platform-based workers. This explains how to assess what counts as ‘working time’ for National Minimum Wage purposes for individuals working in this way.
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