Taylor Review recommends new “dependent contractor” status | Atlantic UmbrellaAtlantic Umbrella

Taylor Review recommends new “dependent contractor” status

by Alan Little

11 July 2017, Comments 0

The Taylor Review into modern working practices, published today, includes amongst its recommendations the creation of a new “dependent contractor” status to enable the more precariously engaged gig workers to benefit from sick pay and holiday leave.

The new category makes a clearer distinction between a fully employed worker and a self-employed individual but does not appear to acknowledge the existence of highly skilled contracting professionals working via their own personal service companies or via Umbrella Companies.

Additional recommendations include a commitment to cover gig workers by National Minimum Wage (NMW) requirements. Gig companies will be required to demonstrate that any individual working for them may earn at least 1.2 times the current NMW of £7.50 per hour for those aged over 25.

Companies will be able to do this by calculating the number of “gigs” (tasks) that an average person working at an average rate can reasonably achieve.

Employers who are only able to afford a pay rate of, for instance, £5 an hour during a quiet spell will be required to allow the gig worker to decide whether or not to accept the rate. However, this would have the effect of preventing workers from taking legal action against a gig employer for not offering the NMW.

Responding last week to Deliveroo’s submission to Mr Taylor’s review panel, Chris Bryce, Chief Executive of the Association of Independent Professionals and the Self-Employed (IPSE), urged caution against any change to the treatment of self-employed people that would jeopardise their essential flexibility.

Repeating his call for the Government to adopt a statutory definition of self-employment that would make it crystal clear precisely who does and who does not work form themselves, Mr Bryce explained: “Being self-employed means being in control of when you work, how you work and who your clients and customers are. It also means you are responsible for saving for later life and being prepared for situations when you aren’t able to work. Self-employment can be hard work, and it’s not for everyone, but increasing numbers of people are making the decision to take their destiny into their own hands.”

These features of independent contracting go some way toward distinguishing the status of high-end professionals who have actively chosen to freelance on a flexible basis in preference to salaried employment.

Praising the gig economy for the freedom, flexibility and work opportunities that it offers, Mr Bryce added that it is important to recognise that gig workers represent only a small proportion of the 4.8-million-strong army of self-employed people, which includes millions of highly skilled individuals such as designers, consultants, plumbers and builders, not to mention freelancing nurses, social workers and teachers.